Minimum Wage Laws

The law affects just about every aspect of work. Federal and state laws regulate the hiring process, terms and conditions of employment, and the circumstances under which employees can be fired. The law helps shape the relationship between employer and employee. The law does not address every issue that can arise in the employment relationship, but a basic understanding of what the law does require can help both the employer and employee anticipate problems and avoid trouble.

There are several stages involved in the hiring of employees: solicitation and review of applications, interview of candidates, and selection of a candidate for hiring. The law impacts on each of these stages. Federal anti-discrimination laws prohibit discrimination in employment, including the hiring process, based on race, color, religion, national origin, sex, age, disability and union affiliation. At the state level, most states have laws duplicating the prohibitions contained in federal law. Moreover, many state laws forbid discrimination based on other types of classifications as well. There are, in addition, some federal and state laws that regulate the use of certain types of tests and screening devices in the hiring process. One interesting aspect of the law is that Federal and State employment laws do not always match. In this case, the law that offers the most protection to the employee is the applicable law.

One area that is of particular interest to everyone is the minimum wage law. Regardless of the location, size of the company or industry, everyone wants to get paid for their time and efforts in the workplace. The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $5.15 an hour. Overtime pay is calculated at a rate of not less than one and one-half times their regular rates of pay. This is required after 40 hours of work in a workweek. (http://www.dol.gov/esa/whd/flsa/)

The majority of states that have minimum wage laws match their minimum wage to the federal minimum. Some states, including Ohio and Kansas have set their state minimum wage below the federal limit. At least ten states have set minimum wage rates that are higher than the federal rate. For example, Oregon's minimum wage is $7.25, and Hawaii's is $6.25. (http://www.dol.gov/esa/minwage/america.htm) In those states that have a minimum wage above the federal rate, all employers, even those covered by the FLSA, must pay the higher state rate. In those states where the 50 state minimum rate is below the federal level, those employers covered by the FLSA must pay the higher federal rate.

As with every law, there are certain exemptions. One such exemption is tipped employees. Employers are allowed to credit tips received by tipped employees against the minimum wage owed to those employees under certain circumstances. In order to qualify for the credit, the tipped employee must be engaged