On July 24th, the federal minimum wage will increase from $6.55 an hour to $7.25 an hour, an increase of 10.7%. The impact on employers will be greatest in 29 states that currently have minimum wage requirements below the new federal minimum. Seven states already have laws mandating $7.25 minimum hourly pay, while 14 states and Washington, D.C., exceed the new minimum. Employers are required to pay whichever is the highest: Federal or state.

Some experts argue that this is possibly the worst time to increase the minimum wage since almost all businesses are dealing with decreased revenues in the current recession. Others, however, argue that putting more money into people's pockets, particularly low-wage workers who are likely to spend the increase to meet living costs, will boost the economy. Regardless, as business owners and managers scramble to comply with the wage increase, a host of new labor and employment issues are beginning to emerge.