A federal minimum wage has been a part of the Fair Labor Standards Act (FLSA) since the law was passed in 1938. It is an important part of the law, because it sets a minimum standard that all employers must follow when paying their employees. Currently, the federal minimum wage is set at $7.25 per hour and it’s been more than five years since the last increase. However, a growing number of states and municipalities have been increasing their minimum wage to levels above the federal minimum.

There are a number of reasons for this. For example, because many economic experts have suggested that the current minimum has fallen behind inflation, a number of states have increased the minimum wage to a level that is higher to help workers keep up. Some states have raised their minimum to better compete with other states for workers. And some municipalities have increased their minimum wage as a practical matter, because the cost of living in their city is so high that the federal minimum wage is simply not practical.

Regardless of the reason, a large number of states and municipalities have increased their minimum wage to a level above the federal level mandated in the FLSA. In some cases, states and municipalities have not only increased the wage, but they’ve also indexed it to inflation, resulting in annual changes over time. For example, Oakland, California will increase its minimum wage to $12.25 in March 2015, and San Francisco, California will raise its gradually to $15.00 by 2018, in part because the cost of living in those two cities is higher than most. Statewide, the California minimum wage is $9.00 per hour.

The FLSA not only allows states to have a higher minimum wage, it also requires that employers pay the highest of the state and federal minimum wages, and all of the other rules regarding the minimum wage also apply. For example, if your state or city has a minimum wage of $8.25 per hour, not only do they have to pay everyone at least that much for every hour of work, but salaried workers whose standard work week is 40 hours must be paid at least $330 per week. Employers may not avoid their obligation to pay the minimum wage by attempting to pay employees on a commission, piece rate or flat rate basis. If the employee puts in 40 hours, they must be paid 40 times the minimum hourly wage that is applicable.

The trend in state and local minimum wage rate increases promises to continue upward for the time being, as states and municipalities deal with the reality that the federal minimum wage is simply inadequate in many jurisdictions, and there seems to be very little likelihood that Congress will take action anytime soon, given the results of the midterms and political realities. Through an Executive Order, the President increased the minimum wage for federal contractors to $10.10 per hour, but Congress seems reticent to act on an increase in the minimum for everyone else.

For nearly two years, the Minimum Wage Fairness Act has been in Congress, but nothing has happened with it, and there is no reason to believe it will anytime soon. That bill would raise the federal minimum wage to $10.10 per hour over three years, but no one in Congress has even offered a compromise.

Florida’s minimum wage is currently $7.93 per hour as of January 1, 2014, and it is set to increase to $8.05 per hour beginning January 1, 2015. Whatever the minimum wage is in the jurisdiction where you work, you are entitled to be paid that amount or more as long as you are covered under the FLSA, and most workers are. You are also entitled to be paid time and a half for all hours worked over 40 in a week, and salaried non-exempt workers who work a standard 40-hour week are entitled to be paid 40 times the minimum at all times. If you believe your employer is violating the applicable minimum wage or overtime laws, you should see a lawyer as soon as possible to discuss your options.

References:

The Trend to Increase Minimum Wage Continues – Is the FLSA Next?

A Big Night for Minimum Wage Increases

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