Can an Employer Pay Less Than Minimum Wage?

You can work for free, but you cannot work for less than minimum wage in most jobs in the United States. The U.S. Department of Labor controls minimum wage for all but a few groups that fall below the minimum wage standards. A nationwide staff of investigators and clerical workers attempts to enforce the regulations of the Wage and Hour Division of the Fair Labor Standards Act to protect workers from sweatshops and abuse seen in other countries.

History

The Fair Labor Standards Act, enacted in 1938, contains the minimum wage provisions that regulate wages of hourly workers in the United States. Wage and Hour provisions cover private as well as state and local government employees. In 1949, the minimum wage increased from 40 cents to 75 cents an hour. The 2007 amendments to the FLSA established minimum wage at $7.25 an hour effective July 2009.

State and Federal

Many states have a minimum wage law, and for persons employed in those states, the highest wage prevails. If the federal minimum wage of $7.25 is lower than the state minimum wage, the employee gets the state minimum amount. Washington, Oregon and California all have a minimum wage higher than the federal rate. In states that have a minimum wage lower than $7.25 an hour, it is ineffective, because the higher wage prevails.

Exempt Workers

Classes of workers exempt from the regular minimum wage provisions are workers with disabilities, student learners and full-time students. Waitresses and employees who receive tips can receive $2.13 an hour and make up the difference in tips. If a tip employee does not receive sufficient tips to total $7.25 an hour, the employee is "tip-deficient" and the employer must make up the difference in accordance with federal law.

Full-Time Students

Full-time students must be paid 85 percent of the minimum wage, and the employer must have a certificate from the Department of Labor. Full-time students are those who attend school primarily in daytime and meet the school or college definition for a full-time student. Student workers cannot work more than 8 hours a day or 20 hours a week during full-time school attendance and 40 hours a week when school is not in session. Retail, service stores, colleges and universities and agricultural jobs are included in this group.

Other Provisions

The student-learner program is for students enrolled in vocational shop courses. The employer must have a Department of Labor certificate and can pay the student-learner 75 percent of minimum wage. The certificate is good only for as long as the student continues in the vocational program.

Employers may pay workers with disabilities less than minimum wage, but the company must have a certificate from the Department of Labor.

Employees under age 20 in the first 90 days of working with a company may be paid $4.25 an hour, but after 90 days or when they reach age 20, the wage goes up to $7.25. In return for employment, these groups gain work experience and an entry for their resumes.

Exemption Employers

Some employers may be exempt from the Fair Labor Standards Act, and, likewise, the minimum wage laws. Some employees of seasonal amusement or recreational establishments are exempt; so are farm workers, newspaper deliverers, casual babysitters and sitters for the elderly.

References

• U.S.Department of Labor: Must Young Workers Be Paid The Minimum Wage?
• U.S. Department of Labor: Wage & Hour Division: Questions and Answers About the Minimum Wage
• U.S. Department of Labor: Wage & Hour Division - Handy Reference Guide to the Fair Labor Standards Act
• U.S. Department of Labor: Minimum Wage Laws in the States - July 1, 2010
• U.S. Department of Labor: Wage and Hour Division History
• Occupational Safety and Health Administration: Wage Index 29 CFR 519 - Employment of Full-Time Students at Subminimum Wages