On July 24, 2009, the federal government increased the minimum wage to $7.25 per hour. 

The increase is the last of three provided by the enactment of the Fair Minimum Wage Act of 2007, which amended the Fair Labor Standards Act (FLSA) to increase the federal minimum wage in three steps: to $5.85 per hour effective July 24, 2007, to $6.55 per hour effective July 24, 2008 and to $7.25 per hour this year. 

The FLSA applies to "employees who are engaged in interstate commerce or in the production of goods for commerce, or who are employed by an enterprise engaged in commerce or in the production of goods for commerce", unless the employer can claim an exemption from coverage. Generally, an employer who does at least $500,000 of business or gross sales in a year satisfies the commerce requirements of the FLSA, and therefore that employer's workers will be subject to the FLSA's protections if none of the other exemptions apply.  Every employer subject to the FLSA’s minimum wage provisions must post, and keep posted in each of its establishments, a notice explaining the FLSA.  The notice must be posted in conspicuous places to permit employees to readily read them. 

The FLSA contains a comprehensive list of employment categories which are exempt from the minimum wage requirement, including, but not limited to executive, administrative and professional employees, seasonal workers, farm workers, those engaged in newspaper delivery and certain domestic servants. 

When an employer is subject to both the federal minimum wage and a state minimum wage, it must pay the higher of the two rates.  The increase in the federal minimum wage will directly benefit approximately 15 million workers in 30 states, including Pennsylvania, New Jersey and Delaware, where the state minimum wage was below $7.25 per hour prior to July 24^th. 

This newsletter is a publication of Nochumson P.C. and is intended for general information only. It should not be construed as legal advice with respect to any particular situation, and readers should not act upon information contained in this newsletter without first consulting an attorney. Copyright © 2009.