Minimum wage requirements establish the lowest hourly rate that companies may legally pay their workers. In the United States, there are generally three types of minimum wage requirements – which include rates at the federal, state and local level. Some jurisdictions have other requirements, such as industry-specific rules. More than half of U.S. states and a significant number of local jurisdictions currently have their own minimum wage rules. An employee is entitled to whichever rate is higher which is generally the state or local rate.
Some cities and counties have passed “living wage” laws, which also establish a minimum pay rate. Check with your local department of commerce to see if your company is subject to such a law.
Minimum wage laws are fairly comprehensive and generally apply to non-exempt employees, and most employers; however they do allow for some exemptions. For example, the Fair Labor Standards Act (“FLSA”), which governs the federal minimum wage requirements, provides for certain exemptions from its minimum wage rules. Some states, such as California, have their own exemptions. If you have employees in one of these states, you must comply with both federal and applicable state rules if you are seeking exempt status for your employee.