Minimum wage laws

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Updated: 4/11/2007 11:26 am
Under The Fair Labor Standard Act, also known as FLSA (F-L-S-A), Congress is given the power to establish the minimum hourly wage employers must pay its employees. The rate is usually determined by economic conditions and can change at the discretion of lawmakers. The current minimum wage rate has been set at $5.15 (five dollars and fifteen cents) an hour. All employees covered under FLSA must be paid at least this rate for each hour worked up to and including 40 hours in a workweek. If some states set a different minimum rate, companies must pay employees the higher rate. It's important to note that minimum wage laws don't strictly apply to hourly wage earners. Companies who employ non-exempt workers who earn salaries or commission must determine whether their average hourly rate meets the minimum wage. If the average hourly rate is less than the minimum wage in any pay period, companies must increase the employee's wages up to the minimum wage. Keep in mind that the FLSA contains a number of minimum wage exceptions that may apply to some workers. For example, the law establishes a youth sub-minimum wage of $4.25 that employers can pay employees under 20 years of age during their first 90 consecutive days of employment. Employers with special certificates issued by the Department of Labor can also pay less than the minimum wage to certain full-time students, student learners, apprentices, employees who earn tips, and workers with disabilities. The Wage and Hour Division of the U.S. Department of Labor is responsible for enforcing the federal minimum wage law. Willful violators of minimum wage laws may be fined up to $1,000 (one thousand dollars) per violation.
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