Wage and Hour Blog
Dolley Law LLC

South Dakota

South Dakota Wage and Hour

The attorneys at Dolley Law have represented clients in many states across the country regarding wage and hour laws and regulations, including in South Dakota. Our attorneys assist clients with a wide variety of issues and disputes relating to federal and state wage and hour laws. Contact us regarding legal representation or consultation on wage and hour matters arising in or under the laws of South Dakota.

South Dakota Minimum Wage Laws

The Secretary of the South Dakota Department of Labor and Regulation publishes the new minimum wage by October 15 of the preceding year, and it takes effect January 1. SDCL 60-11-3.2. As of January 1, 2020, non-exempt employees in South Dakota must be paid at least $9.30 per hour, which is higher than the federal minimum wage rate. Id. By contrast, the Fair Labor Standards Act (“FLSA”) sets the federal minimum wage rate at $7.25 per hour. 29 U.S.C. § 206(a)(1)(C).

South Dakota’s minimum wage rate adjusts annually. SDCL 60-11-3.2. The Consumer Price Index, published by the U.S. Department of Labor, provides the guideline for how much the South Dakota minimum wage rate increases. Id. The minimum wage rate adjusts accordingly, rounded to the nearest five cents, but it will never decrease, even if the Consumer Price Index declines. Id.

Like the FLSA, South Dakota allows employers to pay tipped employees at an hourly rate less than the minimum wage rate, under certain circumstances. SDCL 60-11-3.1; 29 C.F.R. § 516.28 (2019). Tipped employees can be paid at a rate equal to 50% of the minimum wage rate provided that the employee still makes a regular rate above minimum wage rate when all tips are counted toward weekly compensation. SDCL 60-11-3.1. The current state minimum wage rate is $9.30 per hour, so tipped employees must be paid at least $4.65 per hour, excluding tips. SDCL 60-11-3.1. The federal minimum hourly wage rate for tipped employees established by the FLSA is $2.13 per hour. 29 C.F.R. § 516.28 (2019).

South Dakota Overtime Laws

South Dakota does not have state laws regarding overtime pay requirements; therefore, South Dakota employers and employees should look to and follow the FLSA to understand their legal rights and obligations with respect to the payment of overtime wages. See 29 U.S.C. § 207. Nonexempt employees under the FLSA should be paid at a rate 1.5 times their regular rate for every hour worked over 40 in a workweek. 29 U.S.C. § 207(a)(1).

Potential Wage and Hour Liabilities

Employers aware of state and federal minimum wage and overtime guidelines can avoid unnecessary costs and/or liabilities. See 29 U.S.C. § 216(b); SDCL 60-11-7, 60-11-4. Unlike the FLSA, South Dakota does not generally require employers to pay liquidated damages for wage and hour violations; South Dakota law provides that, “if a private employer has been oppressive, fraudulent, or malicious, in the employer’s refusal to pay wages due to the employee, the measure of damages is double the amount of wages for which the employer is liable.” SDCL 60-11-7. This varies from the FLSA, where employers are routinely held liable for unpaid wages and liquidated damages unless the employer meets the burden of proving the subjective and objective reasonableness of its pay practices or policy. See 29 U.S.C. § 216(b).

South Dakota law appears to allow an employee to recover reasonable attorney fees and costs when he or she prevails; however, under South Dakota law, this ability to recover attorney fees and costs is limited to “any action for wages brought in small claims court which is removed to magistrate court or circuit court under § 15-39-59.” SDCL 60-11-24.

However, the Supreme Court of South Dakota recently concluded that an employee may not be able to recover such fees and costs even where a case is brought in small claims court and removed to a circuit court. Goin v. Houdashelt, #28971, 2020 WL 3088117, at *3-5 (S.D. Jun. 10, 2020). The South Dakota Supreme Court reasoned that, because the South Dakota Legislature repealed § 15-39-59 in 2000, and because § 15-39-59 referred only to small claims removed for a jury trial, the plaintiff-employee in the case before—who removed the case from small claims court to circuit court for a bench trial—could not recover such fees and costs. Id. It remains to be seen whether the South Dakota Legislature will take action to re-write SDCL 60-11-24 to provide additional clarification as to when and how an employee may recover fees and costs in pursuing legal claims of wage and hour violations.

Employers receive an additional level of protection in South Dakota. SDCL 60-11-16. If an employee brings claims against an employer that are either false or an attempt to defraud the employer, the employee can be found guilty of a Class 2 misdemeanor. Id. This protects employers from frivolous accusations. Id.

Contact Us

Our wage and hour practice extends across the country. If you are in or around Minnehaha, Pennington, Lincoln, Brown, or Bookings counties, and have further questions or concerns regarding the nature and scope of South Dakota’s wage and hour laws, please do not hesitate to contact our Firm at (314) 645-4100 or kevin@dolleylaw.com.