June 25th marked the 75th anniversary of the Fair Labor Standards Act (FLSA), signed by President Franklin D. Roosevelt. The FLSA was signed in 1938 to establish the minimum wage as well as the 8-hour day, paid overtime and child labor protections. While it’s been a long time since the FLSA stepped in to protect workers’ rights, business groups and their political allies still complain that the minimum wage violates employers’ freedom to set pay levels, forces business firms to cut jobs or even file for bankruptcy, and destroys employees’ drive to work hard. The fact that there is no evidence for these statements hasn’t stopped their complaints.
A recent study by William Lester of the University of North Carolina and Ken Jacobs of the University of California-Berkeley found no difference in employment levels between comparable cities with and without living wage laws. They disproved the claim that these laws drive away business or lead to reduced employment while also providing evidence that fair minimum wages are good for the economy.
States such as California continue to go above and beyond the minimum FLSA requirements, offering better wage and hour laws to workers compared to the federal law. California provides daily overtime pay after 8 hours per day, as well as double time, also known as “golden time”, for hours worked over twelve per day and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek. California overtime laws require overtime pay to be paid to non-exempt employees under the following circumstances:
- Any hours worked over 8 per day at 1 ½ times regular pay rate
- Any hours worked over 40 per week at 1 ½ times regular pay rate
- First 8 hours on the 7th consecutive day worked at 1 ½ times regular pay rate
- Any work in excess of 12 hours per day at 2 times regular rate
- Any work in excess of 8 hours on the 7th consecutive day at 2 times regular rate
The last time Congress raised the federal minimum wage was in 2007, when President George W. Bush reluctantly signed the bill passed by the Democratic Congress to raise the federal minimum wage from $5.15 an hour to $7.25 an hour. It has remained at $7.25 since 2009, while California’s state laws have set the minimum wage to $8.00 per hour. The higher minimum wage has made California a more favorable state to work in after taking into account the overtime laws specific to California.
