Minimum Wage

By James Parker
/
June 13, 2022

What Is the Minimum Wage?

The minimum wage is a legally required pay rate that is mandated by either federal or state law. According to the U.S. Department of Labor, the minimum wage that an employer is required to pay is either the federal minimum wage of $7.25 per hour worked or the state minimum wage depending on which is higher. 

The law deciding minimum wage is a provision of the Fair Labor Standards Act (FLSA). The most recent federal increase occurred in 2009. Previously the minimum wage was increased to $4.75 and $5.15 in 1996 and 1997 respectively. The FLSA also has a different set of laws determining the wages for businesses that are exempt from the federal minimum wage rules. 

In addition to federal and state minimum wage laws, any state laws that include wage protections are required for employers to fulfill. Some exemptions to minimum wage discussed in the FLSA include workers who receive tips and workers under the age of 20. Additionally, restrictions are in place to limit exceptions to the minimum wage laws.

Key Takeaways

  • Minimum wage determines the lowest possible wage that can legally be paid by employers. In the event that a state has both a state and federal minimum wage, the higher wage is the one mandated by law.
  • Minimum wage is dictated federally by the Fair Labor Standards Act and at the state level by local legislatures. Both are overseen by the U.S. Department of Labor’s Wage and Hour Division.
  • If you have been paid less than the minimum wage by your employer, an experienced Employment Law attorney may be able to improve the outcome of your case by utilizing experience and expert knowledge.

Minimum Wage and Employment Law

Minimum wage is enforced by the Department of Labor’s Wage and Hour Division. In addition to ensuring that federal minimum wage is maintained for nonexempt workers, the Wage and Hour Division also oversees exception wages. 

For example, tipped employees have a series of regulations governing their wages. Under federal minimum wage law, the minimum wage for tipped workers is $2.13 per hour if it can be demonstrated that when combined with the employee’s tips they make minimum wage. In the event that a tip-based worker does not earn enough in tips to make minimum wage, the employer must make up the difference.

Minimum wage law affects all U.S. states, territories, and regions. Some of these regions have decided to institute minimum wage laws in addition to federal standards and some have not. 

The states and territories that have not implemented any minimum wage laws or have minimum wage laws at the federal minimum include:

  • Alabama
  • Commonwealth of the Northern Mariana Islands
  • Idaho
  • Indiana
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana
  • Mississippi
  • North Carolina
  • North Dakota
  • New Hampshire
  • Ohio (for companies with under $342,000 in annual sales)
  • Oklahoma (For employers of 10 or more employees or $100,000 in annual sales)
  • Pennsylvania
  • South Carolina
  • Tennessee
  • Texas
  • Utah
  • Wisconsin

Some of these states, like Iowa, have a clause in their minimum wage laws that if the federal minimum wage increases then the state law will rise to match. Other states, like Utah, have laws that simply adopt the federal minimum wage as the state minimum as well. There may also be states which have special provisions that increase pay under certain circumstances. Kentucky’s 7th Day provision requires employers with qualified employees who work seven days straight to pay time and a half for the hours they work on the seventh day.

While many states and territories simply adopt federal minimum wage, not all of them do. Some states also have provisions that actually pay under the federal minimum wage, such as:

  • Georgia - $5.15/hr
  • Montana (for companies with less than $100,000 in annual sales) - $4/hr
  • Oklahoma - $2.00/hr
  • Puerto Rico - $5.08/hr
  • Wyoming - $5.15/hr

These laws can become legally dense. If an employee is not covered by the FLSA, does not cross state lines for work, or is in some other way exempt from federal coverage, these minimum wage laws may hold up.

The remaining states and territories have varying conditions and rules regarding their minimum wages. Some states adjust the minimum wage depending on whether the employer gives health insurance, how many employees an employer has, or any number of other factors that the legislature deems relevant to determining minimum wage. Some U.S. territories, such as American Samoa or the Commonwealth of Northern Mariana Islands, have special minimum wage rates. The minimum wage of the remaining states and territories are:

  • Alaska - $10.34/hr
  • Arizona - $12.80/rh
  • Arkansas - $11.00/hr
  • California - $14.00/hr for employers with less than 26 employees and $15.00 for employers with 26 or more employees
  • Colorado - $12.56/hr
  • Connecticut - $13.00/hr
  • Delaware - $10.50/hr
  • Florida - $10.00/hr
  • Guam - $8.75/hr 
  • Hawaii - $10.10/hr
  • Illinois - $12.00/hr
  • Maine - $12.75/hr
  • Maryland - $12.50/hr
  • Massachusetts - $14.25/hr
  • Michigan - $9.87/hr for employees 18 or older, otherwise $8.39/hr
  • Minnesota - $10.33/hr for employers with more than $500,000 in annual revenue or $8.42/hr for employers with under $500,000 in annual revenue or employees under 18
  • Missouri - $11.15/hr
  • Montana - $9.20/hr for businesses with annual sales above $110,000
  • Nebraska - $9.00/hr
  • New Jersey - $13.00/hr or $11.90/hr for seasonal employees or employers with fewer than six employees
  • New Mexico - $11.50/hr
  • Nevada - $9.75/hr or, if the employer offers health insurance, $8.75/hr
  • New York - $13.20/hr or $15.00/hr in New York City, Westchester, and Long Island
  • Ohio - $9.30/hr for employers with annual sales of at least $342,000
  • Oregon - $12.75/hr
  • Puerto Rico - $8.50/hr
  • Rhode Island - $12.25/hr
  • South Dakota - $9.95/hr
  • Virgin Islands - $10.50/hr
  • Virginia - $11.00/hr
  • Vermont - $12.55/hr
  • Washington - $14.49/hr
  • Washington D.C. - $15.20/hr
  • West Virginia - $8.25/hr

These rates may change with political movements and decisions, but many states provide terms and rules for growth in their minimum wage laws. Several states, including New York, base their minimum wage on being above the federal minimum wage by a certain amount.

Bottom Line

If you have been paid less than the minimum wage as required by state or federal law, you may be able to file a lawsuit to recover the wages that you are owed. In order to recover the wages that you are owed, you will need the help of an experienced Employment Law attorney. 

An experienced Employment Law attorney can gather evidence by subpoenaing records and deposing witnesses. Then, using legal expertise, trial tactics, and expert witnesses, they can zealously advocate for you in order to secure the best possible outcome for your case.

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