What is the minimum wage?

The minimum wage is the lowest wage an employer   may pay an hourly employee according to the  Fair Labor Standards Act (FLSA). The current federal minimum wage  for  non-exempt employees in the US  is $7.25 per hour. Some states mandate a higher minimum wage than the federal minimum wage; employers must comply with their state's minimum wage if it is higher than the federal minimum wage. In states where the state minimum wage is lower than the federal minimum wage, employers must pay non-exempt employees the federal minimum wage.

Which state has highest minimum wage?

As of July 1, 2020, Washington, D.C. has the highest minimum wage at $15 per hour. This is followed by Washington at $13.50 per hour and California at $13 per hour. The state with the lowest minimum wage is Georgia, at $5.15 per hour; however, because this is lower than the federal minimum wage, Georgia employers are required to pay the federal minimum rate. To review each state's minimum wage laws,   visit the U.S. Department of Labor's website .

How often does the minimum wage increase?

The federal minimum wage does not increase on a regular or scheduled basis. To increase the minimum wage, Congress must pass a bill and the President must sign it into law. As of July 2020, the federal minimum wage was last increased in 2009. States are in control of their minimum wage requirements and can increase it according to state laws. In past years, this has been done by legislation, ballot measure, or state constitutional amendment.

Who is exempt from the minimum wage?

The following employees are exempt from the federal minimum wage:

• Commissioned Sales Employees
• Agricultural labourer
• Seasonal and recreational establishment workers
• Executive, administrative, professional, and outside sales employees who are paid on a salary basis
• Child care on a casual basis
• Companion for the elderly
• Disabled workers
• Federal Criminal Investigators
• fishing workers
• full time student
• newspaper delivery people
• Newspaper staff for newspapers with limited circulation
• Seamen on non-US ships
• switchboard operator

Employers working in these areas should review federal and state minimum wage laws.

Minimum wage for tipped workers

Employers can pay tipped employees a minimum of $2.13 per hour if:

• This amount, plus tips, is at least the federal (or state if it is higher) minimum wage
• The employee keeps all tips
• Employee regularly earns more than $30 in tips each month

If an employee's tips and $2.13 per hour pay don't equal the minimum wage, the employer must make up the difference.

Some states have their own laws governing payment to tipped employees.  Be sure to review all relevant labor laws in any state where you have employees. 

Young Workers and the Minimum Wage

If an employee is under 20, they can be paid the minimum wage of $4.25 per hour for the first 90 days on the job. If they work longer than 90 days or turn 20 during that time, they must be paid the federal or state minimum wage (whichever is higher).