As the wealth disparity between rich and poor continues to grow in the United States, the minimum wage has been the subject of much debate. Critics contend that the minimum wage does not provide a living wage, while supporters point to market forces and increasing globalization as a reason to keep it where it is. Regardless of the merits of these arguments, the minimum wage is established by the federal Fair Labor Standards Act (FLSA) as well as state law in some states. While a relatively new concept, minimum wage has become widely accepted as part of modern worker protections, along with other measures such as the 40 hour workweek, overtime pay, the right to unionize, and anti-discrimination laws. The body of law governing wage and hour disputes is vast and complicated, and anyone who has a legal issue in this area should contact one an experienced employment law attorney as soon as possible.
The federal minimum wage is set at $7.25 per hour, and has been since July 24, 2009. This equates to a yearly income of just over $15,000, before taxes. In most parts of the country, this amount falls short of what is generally considered a living wage, and is only about $4,000 over the federal poverty guidelines set for a household of 1 person. In what was presumably an attempt to help employees and develop public good-will, McDonald’s issued a proposed budget to its minimum wage employees that has garnered wide-spread criticism. According to an opinion piece published at the Huffington Post, it does less to help employees and more to draw attention to the fact that it is nearly impossible to make ends meet on minimum wage. Some highlights from the budget:
-It assumes that a full-time employee has a second job
-It allows only $600 per month for housing payment
-It budgets $20 per month for health insurance
-It does not budget any amount for groceries or food.
-It does not include any provision for gas or transportation.
-A link to the proposed budget can be found here.
Fortunately for Oregon workers, Oregon minimum wage is set at $8.95 per hour, which the second highest in the country. It has been at $8.95 since January 1st, 2013, and equates to $18,616 for full time workers. A full listing of state minimum wages can be seen here.
As inflation and the cost of living rises, there will be political pressure to raise the minimum wage, both on the federal and on state levels. The Obama administration has proposed raising minimum wage, drawing criticism from congressional Republicans. Some schools of economic thought hold that raising the minimum wage also increases unemployment, as employers try to squeeze more work out of fewer employees.
Whatever the future of minimum wage in the United States, anyone with a wage dispute should contact an experienced employment attorney at HKM as soon as possible.