Cost-of-Living Raises – Are They Mandatory?

Some state minimum wage adjustments are tied to the consumer price index, but otherwise, cost-of-living raises are not required by state or federal law. You just need to make sure you’re paying any applicable state and municipal minimum wages. That said, if the cost of living has increased in your area, you might want to raise wages (if you can afford it) to stay competitive in the market.

The Minimum Wage Map on the HR Support Center is a good place to start if you have questions about the minimum wage or wages where your employees work. The Laws library, also on the Support Center, has more in-depth information about city rates.

Kyle, PHR is a professional author, editor, and researcher specializing in workplace culture, retention strategies, and employee engagement. He has previously worked with book publishers, educational institutions, magazines, news and opinion websites, nationally-known business leaders, and non-profit organizations. He has a BA in English, an MA in philosophy, and a PHR certification.