L&E Legal Alert – Puerto Rico Minimum Wage Will Increase to $10.50

Puerto Rico Minimum Wage Will Increase to $10.50 on July 1 as Previously Established by Act No.  47-2021

On June 12th, 2024, the Minimum Wage Review Commission for Puerto Rico announced no changes were to be made to the minimum wage salary increase to $10.50 approved by Act No. 47-2021 and set to take place next month on July 1st, 2024. The Commission explained that their determination was based on the results of an economic report commissioned to the company Abexus Analytics. As reported, the analysis considered the data collected from quarterly reports from the Department of Labor and Human Resources (DTRH), the Quarterly Employment and Wage Census (ES-202), aggregated data from corporate income tax returns from the Department of Treasury, the inflation rate, and other factors established in Law No. 47-2021, better known as the Minimum Wage Law of Puerto Rico.    

Act No. 47-2021 was enacted on September 21, 2021, which established an annual minimum wage increase system for non-exempt employees of the private sector in Puerto Rico. According to the legislation, the minimum wage was increased to $8.50 on January 1, 2022, to $9.50 on July 1, 2023, and will be increased to $10.50 on July 1st of 2024. The Act also created the “Minimum Wage Review Commission” which was granted authority, among other things, to review and amend the minimum wage established by law. 

Companies that do not comply with the minimum wage laws can be subject to fines and penalties imposed by the Act, and may be held liable for civil damages in an amount equal to twice the amount of the damages these actions may have caused to the employee. To avoid these consequences, companies should ensure compliance by reviewing and updating their payroll practices and staying informed about any changes in the regulatory environment. 

Stay tuned with our Labor and Employment practice alerts. Our team will provide updates on any future developments and is always available to support your business with any questions or concerns regarding this topic. Please contact us at labor@estrellallc.com.