Minimum Wage in the 110th Congress


Publication Date: December 2006

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Labor

Type:

Abstract:

In 1938, following decades of discussion and research in academic and policy circles, Congress adopted the Fair Labor Standards Act (FLSA). It quickly became the primary federal statute in the fields of minimum wage, overtime pay, child labor, industrial work at home, sweatshops, and related areas.

The act is a living statute, variously modified through the years as Congress has set forth new requirements for American workers and their employers. Where the minimum wage is specifically concerned, the act has undergone major modification on eight different occasions: in 1949, 1955, 1961, 1966, 1974, 1977, 1989, and 1996. Under current law, the minimum wage is $5.15 per hour.

The FLSA mandates that not less than the minimum wage be paid to most workers -- and it requires that the employer pay it. There are other elements of the law that qualify its mandate. The employer, for example, may pay only a portion of the income of a tipped employee ($2.13 per hour) -- so long as the total income reaches the federal minimum rate. Under some conditions, a youth worker may receive less than the minimum wage. Some employees of small businesses, for example, may be entirely exempt from the federal minimum wage. Persons with disabilities can be paid a wage commensurate with their productivity -- but with no floor or minimum standard.

It has now been a decade (i.e., 1996) since the minimum wage was last adjusted for inflation. The issue absorbed a considerable amount of attention during the 109th Congress -- but no new legislation was adopted. Some 27 states (including the District of Columbia) have adopted a minimum wage in excess of the federal rate.

If the 110th Congress takes up the minimum wage question, there may be a number of issues to be addressed -- for example, the tip credit provision, the matter of a youth sub-minimum, indexation of the wage rate, and the small business exemption.

This report examines the background and context of the minimum wage, and the demographics of the minimum wage (low-wage) workforce. It will be updated as conditions warrant.