Minimum wage laws set forth the lowest hourly wage rate an employer may pay employees to perform work. Although minimum wage laws are fairly comprehensive in their coverage, most provide exemptions and/or limitations to their applicability based on factors such as an employee’s age, an employer’s size, the type of industry, whether an employee receives tips, the type of work performed by the employee, etc. Additionally, minimum wage laws apply regardless of whether an employer pays an employee by the hour, by salary, by piece, by commission, etc., unless an exception to the minimum wage law applies.
Federal Minimum Wage Law
The federal government set forth a national minimum wage rate in the Fair Labor Standards Act (FLSA). Currently, the federal minimum wage rate is $7.25 per hour, for non-tipped and non-exempt employees. For tipped employees, the federal minimum wage rate is $2.13. Several classifications of employees are exempt from the FLSA’s minimum wage requirement. For more information about the federal minimum wage requirements and the FLSA, click here.
State Minimum Wage Laws
Minimum wage laws vary between the states. Many states have either not passed any minimum wage laws or have simply adopted the federal minimum wage laws set forth in the FLSA. Other states have passed their own minimum wage rates, many of which are accompanied by their own complex sets of rules and regulations. For a list of state minimum wage rates and links to state-specific minimum wage information, visit State Minimum Wage and Overtime Summaries.
Conflicts between Federal and State Minimum Wage Laws
In states where the state minimum wage law differs from the federal minimum wage law, the question is raised as to which law an employer must apply to its employees. The answer is that an employer must apply the minimum wage law that results in its employees being paid the highest wage rate. Thus, if the state minimum wage rate is higher than the federal rate and no exceptions apply, an employer would be required to pay its employees the state minimum wage rate, and vice versa.