On May 25th, 2007, President Bush signed an Iraq funding bill that included the first federal minimum wage increase in nearly ten years. The bill increases the minimum wage in three increments to $7.25 by Summer of 2009. The first increase takes effect July 24th, 2007, raising the current federal minimum wage from $5.15 to $5.85.
Every employer of employees subject to the Fair Labor Standards Act's minimum wage provisions must post, and keep posted, a notice explaining the Act in a conspicuous place in all of their establishments so as to permit employees to readily read it. Although many states are currently operating under a State Minimum Wage that is already higher than the Federal Minimum Wage, they still must post the new notice reflecting the new Federal rate.
The federal minimum wage for covered nonexempt employees is currently $5.15 an hour however this will increase to $5.85 as of July 24th and $7.25 by Summer of 2009. The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA).
Many states also have minimum wage laws. Where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to higher of the two minimum wages.
The minimum wage law (the FLSA) applies to employees of enterprises that do at least $500,000 in business a year. It also applies to employees of smaller firms if the employees are engaged in interstate commerce or in the production of goods for commerce, such as employees who work in transportation or communications or who regularly use the mails or telephones for interstate communications. It also applies to employees of federal, state or local government agencies, hospitals and schools, and it generally applies to domestic workers.
The Wage and Hour Division of the U.S. Department of Labor is responsible for enforcing the minimum wage. Using both enforcement and public education efforts, Wage and Hour strives to ensure that workers are paid the minimum wage.
$4.75 per hour beginning October 1, 1996
$5.15 per hour beginning September 1, 1997
$5.85 per hour beginning July 24, 2007
Various minimum wage exceptions apply under specific circumstances to workers with disabilities, full-time students, youth under age 20 in their first 90 consecutive calendar days of employment, tipped employees and student-learners.
Employees under 20 years of age may be paid $4.25 per hour during their first 90 consecutive calendar days of employment with an employer.
Certain full-time students, student learners, apprentices, and workers with disabilities may be paid less than the minimum wage under special certificates issued by the Department of Labor.
Tip Credit: Employers of "tipped employees" must pay a cash wage of at least $2.13 per hour if they claim a tip credit against their minimum wage obligation. If an employee's tips combined with the employer's cash wage of at least $2.13 per hour do not equal the minimum hourly wage, the employer must make up the difference. Certain other conditions must also be met.
Overtime Pay: At least 1 times an employee's regular rate of pay for all hours worked over 40 in a workweek.
Child Labor: An employee must be at least 16 years old to work in most non-farm jobs and at least 18 to work in non-farm jobs declared hazardous by the Secretary of Labor.
Youths 14 and 15 years old may work outside school hours in various non-manufacturing, non-mining, non-hazardous jobs under the following conditions:
No more than -
3 hours on a school day or 18 hours in a school week;
8 hours on a non-school day or 40 hours in a non-school week.
Also, work may not begin before 7 a.m. or end after 7 p.m., except from June 1 through Labor Day, when evening hours are extended to 9 p.m. Different rules apply in agricultural employment.
ENFORCEMENT: The Department of Labor may recover back wages, either administratively or through court action, for the employees that have been underpaid in violation of the law. Violations may result in civil or criminal action.
Fines of up to $11,000 per violation may be assessed against employers who violate the child labor provisions of the law and up to $1,100 per violation against employers who willfully or repeatedly violate the minimum wage or overtime pay provisions. This law prohibits discriminating against or discharging workers who file a complaint or participate in any proceedings under the Act.
