Overview: Federal minimum wage law requires that all nonexempt employees be paid at least $7.25 for every hour they work; this is the federal minimum wage. Twenty-six states have (or will soon have) even higher minimum wages.
Since about 97 percent of the American workforce earns more than the minimum wage, very few employers need to concern themselves with this baseline requirement. Nevertheless, an employer that makes agreed-upon deductions from an employee's pay – for example, deductions for cleaning uniforms – must be careful that the deductions do not bring the employee's wage below the applicable minimum rate.
To comply with minimum wage laws, an employer can apply certain payments – most notably, tips that wait staff, bartenders and other tipped employees receive for service, and the cost of board and lodging – toward its minimum wage obligations.
Also, minimum wage laws allow certain employees – including students, workers with disabilities, messengers, apprentices and student-learners – to be paid at subminimum wages below the normal rate.
Trends: To help employees keep pace with the rising cost of living, 14 states adjust (or will adjust) their minimum wage rates based on the rate of inflation. Lawmakers have introduced legislation that would do the same in other states, and at the federal level.
Author: Michael Cardman, Legal Editor
In-depth review of the spectrum of Washington employment law requirements HR must follow with respect to minimum wage.
California's attorney general approved the title and summary of a ballot initiative that, if approved, would increase the state minimum wage to $11.00 in 2017, and by another $1.00 over each of the next four years. Then, starting in 2022, the minimum wage would be adjusted each year based on the rate of inflation.
Many states and municipalities have minimum wage requirements. This Quick Reference chart sets forth the state minimum wage rates for all 50 states plus the District of Columbia. It also covers selected local minimum wage ordinances that apply to most or all employees who work within a particular jurisdiction.
In-depth review of the spectrum of Missouri employment law requirements HR must follow with respect to minimum wage.
HR guidance on complying with federal and state minimum wage laws.