Getting To Grips With The Minimum Wage

September 30, 2017

The minimum wage laws of the Federal Fair Labor Standards Act (FLSA) must of course be complied with by every U.S. business. Here is some useful information if you’re thinking about taking on employees in your business, and need to know a bit more about the minimum wage.

What is the current minimum wage?

The federal minimum wage is currently at $7.25 per hour, and hasn’t changed since July of 2009. However, not every state follows this, and in those states where the minimum wage rate is higher than that of the state, employers are required to pay their workers that higher amount. Of the 50 states, around 30 of those have minimum wage rates that are higher than that of the state.

Who is entitled to receive minimum wage?

The minimum wage applies to two types of workers classed under 'Enterprise Coverage' and 'Individual Coverage'.

Enterprise Coverage applies to businesses with at least two employees, and that make more than $500,000 per annum. This type of coverage can also be applied to hospitals, those businesses that give nursing care for residents, schools and government agencies.

Individual Coverage is applied to those who work in any form of interstate commerce, such as companies making or sending products out of state, or those who provide caretaker services in buildings used for interstate commerce.  

What are the conditions to be met for minimum wage to apply?

Employers must pay their workers the minimum wage for the duration of their time spent on the business premises, while they are on duty or are present at a prescribed workplace. That said, there may be other circumstances in which minimum wage payments must be made to employees, such as:

  • Waiting time

One example might be of a fireman who is paid while waiting for a call out

  • On-call time

Sometimes employees are required to wait at site and be on call in case they are needed to perform a duty described in their job description.

  • Rest and meal breaks

Meal breaks are generally not covered by minimum wage, although they may be under circumstances such as the employee remaining at their desk or continuing to carry out work related duties while on their meal break.Rest periods of 20 minutes or less are covered.

  • Sleep time

If your staff members are employed on a 24 hours roster, then this applies to them.

  • Lectures, meetings and training time

Provided the worker has permission to attend these venues for work related purposes, minimum wage applies.

  • Travel time

There are several categories of travel time that apply for employees, such as home to work, but it’s best to check the FLSA requirements to make sure that you pay your workers appropriately.

How important is it to understand minimum wage laws?

If you want your business to conform to minimum wage requirements, and avoid costly penalties or lawsuits from disgruntled employees, then it’s imperative that you do your best to get to grips with minimum wage laws. If you are struggling or are concerned that your business may not be conforming, then it’s best to engage the services of a professional company who can better advise you. There are many reputable companies offering such advice and guidance, and paying them could be a lot less costly than going it alone and getting it wrong.

Try to keep clear and accurate records to help avoid penalties 

As an employer, you are required by law to keep records as proof of the fact that your workers have been receiving at least the minimum wage. Some details that must be kept about each staff member, include the hours they have worked and the wage that they received.

Should you be requested to provide proof of this, it is your responsibility as the employer, to do so, and records must be kept for a minimum of three years from the pay period in question.

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