labor and employment NOTES
August 2009
HOLIDAY SEASON IN JULY?
Effective July 24, 2009, the federal minimum
wage increased from $6.55 per hour to $7.25 per
hour for all non-exempt employees. The 2009
increase in the federal minimum wage was the
third and final increase to the federal minimum
wage pursuant to Fair Minimum Wage Act of
2007. Under the 2007 Act, the minimum wage
established by the Fair Labor Standards Act
increased in three steps from $5.85 per hour
effective July 24, 2007, to $6.55 per hour effective
July 24, 2008, and to $7.25 per hour effective July
24. The Fair Labor Standards Act in enforced by
the U.S. Department of Labor’s Wage and Hour
Division. The first federal minimum wage, set
October 29, 1938, was $.25 per hour. The federal
minimum wage broke the $1.00 threshold effective
March 1, 1956; $2.00 effective May 1, 1974; $3.10
effective January 1, 1980; $4.25 effective April 1,
1991; and $5.15 effective September 1, 1997. In
addition to the establishment of the minimum
wage, the Fair Labor Standards Act establishes
overtime pay requirements, record keeping and
posting requirements, and youth employment
standards. Under the Fair Labor Standards Act,
non-exempt, employees must be paid at least
the minimum wage per hour one and one half
times the employee’s “regular rate of pay” (not
necessarily their hourly rate, it could be more) for
all hours works over forty per workweek. Section
(13)(a)(1) of the Fair Labor Standards Act provides
an exemption to both the minimum wage and
overtime obligations. Under Section (13)(a)1,
employees employed as bona fide executive
administrative, professional employees, and
outside sales people are considered “exempt”
if: (1) certain tests regarding their job duties are
met and (2) the employee is paid on a “salary
basis.” The employee’s specific job duties, not
title, dictate whether the employee is exempt or
non-exempt. Although state law provides for
breaks for minors, the Fair Labor Standards Act
does not require breaks or meal periods. Nor
does the Fair Labor Standards Act define “fulltime” employment. This designation “full-time”
(versus part-time) employment is determined by
the employers. Likewise, the Fair Labor Standards
Act does not require severance pay, sick leave,
vacation, or holidays.
A. Edward Hardin, Jr., Partner
225.382.3458
[email protected]
This newsletter is designed as a general report on legal developments. The published material does not
constitute legal advice or rendering of professional services.
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