History of the Minimum Wage Law
The first form of minimum wage law was introduced in 1896, but instead of requiring employers to pay at least a guaranteed minimum wage amount, the law in its infancy only set up arbitration boards to prevent labor strikes. Australia, New Zealand, the United Kingdom and the colony of Victoria, Austria were the first to establish laws creating arbitration boards of this nature.
The first of these laws were created in New Zealand in 1896 under the Industrial Conciliation and Arbitration Act.
1899 is when Victoria, Austria came on board with arbitration counsels.
In 1907, Australia set a “living wage” for a family of four.
The Trade Boards Act established arbitration boards in 1909 for the United Kingdom.
In 1912, Massachusetts and the United States were the first to set minimum wages for women and children in an attempt to control the proliferation of sweat shops and manufacturing industries.
It was not until the Fair Labor Standards Act of 1938 was passed in the U.S. that a national minimum wage standard was set for most workers in the public and private sector.
This law set the standard for many modern employment practices, including the nation-wide minimum wage, the ‘time-and-a-half’ overtime pay for full-time workers, the eight-hour work day and forty-hour work week, and restrictions for the employment of minors.
Over the course of time, amendments were added to the 1938 law that extended its benefits to other workers.
Minimum wage was raised from 40 cents to 75 cents per hour.
Benefits extended to retail and service workers, and minimum wage was raised to 90 cents per hour.
The hourly wage rate was raised to $1.25.
The hourly wage rate was raised to $1.60.
The hourly wage rate was raised to $2.30.
The hourly wage rate was raised to $3.35.
The hourly wage rate was raised to $4.25.
The law for minimum wage in the US is mandated by FLSA guidelines and the current minimum wage standard is $7.25/ hour. These changes were mandated by the 2007 Fair Minimum Wage Act, which also extended the law to American territories like American Samoa and Puerto Rico.
2010s and Beyond
In the last several years, some cities have taken it into their own hands to change their minimum wage, opting to pay $15 per hour, more than double the $7.25 requirement.
The first was Seattle, Washington, which voted on the change in 2014. San Francisco, California followed suit in July 2018, with New York City, New York doing the same at the end of that year. Washington D.C.’s minimum wage will reach $15 by 2020, and Minneapolis, Minnesota will increase theirs by 2022.
Some states have yet to set a minimum wage law. These states include Alabama, Louisiana, Mississippi, South Carolina, and Tennessee. Other states require employers to pay even more than the $7.25/ hour while other state standards are less than national standards. In cases where an employee is subject to both state and federal laws, the employee is entitled to the higher of the two.
More Employment Laws
These laws were just the beginning…new employment and labor laws now include overtime laws, as well as mandatory overtime and employee exemption rules. State overtime laws vary widely. If you think you’re employer owes you overtime pay that was unfairly withheld, fill out our Case Evaluation Form to consult with a reliable overtime lawyer about the merits of your case.