History of the FLSA
The FLSA, or Fair Labor Standards Act, was established in 1938 by Congress to ensure that the employees in the private sector recieved a minimum wage and that the employees worked fair hours. The FLSA also includes a clause that ensures that if employees work over a set number of hours per week, then the employer must pay the employee one and a half times their normal wage for every hour that is over the set number of hours per week.¹ This was included to encourage employers to create a maximum number of jobs so that they didn't have just a few employees working long hours. However, there are some exceptions to employees working certain jobs that do not need to be paid the minimum wage, one and a half times normal wage for over time, or both. These jobs include commissioned sales employees, computer professionals, drivers, and salesmen.²
The FLSA was first passed during the 1930's. During this time America was going through the Great Depression that left many people unemployed. In response this piece of legislation was passed to for buisnesses to hire more workers for shorter periods of time to increase the money in the hands of the consumers rather than consolidate lots of jobs and money into the hands of a few. This was part of the New Deal acts that were proposed and passed to stimulate the American economy to try to bring it out of the depression.
At the time the FLSA was passes there was an established minimum wage of $0.25 an hour. Since then it has been raised quite a few times to what it is today, $5.15 an hour. This minimum wage covers many employees but there are some exempt employees that may be paid a lower wage than $5.15 an hour.(4)Also, the minimum wage has never been sufficient to raise a family out of poverty. This can be seen on the second graph.
In addition to the federal minimum wage, states are allowed to create their own minimum wage. However, the states are not allowed to make their state minimum wage below the federal minimum wage. (5) This gives states flexibility in terms of what the local employers want to pay their employees.
1. http://www.dol.gov/esa/whd/flsa/
2. http://www.dol.gov/elaws/esa/flsa/screen75.asp
3. http://www.dol.gov/esa/minwage/chart.htm
4. http://oregonstate.edu/instruct/anth484/minwage.html
5. http://www.dol.gov/esa/minwage/america.htm