This week’s Saturday Reblog touched briefly on the minimum wage issue. In light of current events and the passing of Labor Day (that sounds about right) I wish to expound on this topic a bit more. My goal is to make a couple of points that I think are patently obvious that I haven’t quite seen before, not that I’ve looked very hard. –Ed.
The Federal minimum wage is $7.25 per hour. This minimum rate of pay became effective way back on July 24, 2009, as part of the Fair Labor Standards Act (FLSA). That was over four years ago.
Like practically all business laws in this country, the FLSA law provides plenty of exceptions and loopholes in favor of business. The standard practice is to make laws that appease the mindless masses by rendering them toothless. If the law was a ravenous tiger it wouldn’t even be able to gum anyone to death.
Some fun exceptions:
- Employees who receive tips can be paid as little as $2.13 per hour in “direct” wages as long as hourly pay with tips meets $7.25 hour.
- Full-time students who work in retail or service stores, agriculture, or colleges and universities can be paid no less than 85% of minimum wage.
- Workers under the age of 20 can be paid as little as $4.25 per hour “first 90 consecutive calendar days of employment with an employer, as long as their work does not displace other workers.”
- “Other programs that allow for payment of less than the full federal minimum wage apply to workers with disabilities, full-time students, and student-learners employed pursuant to sub-minimum wage certificates. These programs are not limited to the employment of young workers.”
- High school students at least 16 years old and enrolled in “vocational eduction” can be paid at 75% of minimum wage.
- “Farmworkers employed on small farms are exempt from both the minimum wage and overtime pay provisions of the FLSA. Young workers employed on small farms, with parental consent, are also exempt from the child labor provisions of the FLSA. Other farmworkers are exempt from the FLSA’s overtime provisions.”
- “The minimum wage law (the FLSA) applies to employees of enterprises that have annual gross volume of sales or business done of at least $500,000. It also applies to employees of smaller firms if the employees are engaged in interstate commerce or in the production of goods for commerce, such as employees who work in transportation or communications or who regularly use the mails or telephones for interstate communications. Other persons, such as guards, janitors, and maintenance employees who perform duties which are closely related and directly essential to such interstate activities are also covered by the FLSA. It also applies to employees of federal, state or local government agencies, hospitals and schools, and it generally applies to domestic workers.”
If that last bullet point doesn’t make your head spin, nothing will! I defy you to understand what it really means. (Quoted text comes from the official DOL.gov website.)
And that’s about it to understanding employment law in the United States. Water it down, get business to sign off on it, and, oh hell, get business to write it in the first place. That’s called proactive buy-in. The second component, of course, is an almost total lack of any kind of actual enforcement mechanism. That leaves business the free time necessary to complain about high concept ideas like minimum wage.
If you think this shit sounds overly confusing you wouldn’t be wrong. It’s all deliberately made to be as confusing as possible. Now I wonder? Hmmm. Who do you think has a more powerful lobby? Business or minimum wage workers?
Regardless of what this all means, one thing is crystal clear: Employers sure don’t like sharing profits with the people who actually do the fucking work.
And now, without further delay, the two points that I think are pretty obvious.
Point Numero Uno
To imply that raising minimum wage is the same as raising prices assumes that portions of the pie must always remain fixed.
No shit, Sherlock. Did I mention these would be obvious?
If only there was some other way. Like raising one while shrinking the other. That would be meaningful change, though, so we can’t have that. We must not do anything to derail the juggernaut of inequality that has been building over the last few decades while the Great Nation of the United States doubled domestic gross domestic product.
Meanwhile, minimum wage now has less actual buying power than it did during the time of the Great Depression.
Yeah, that makes sense. After all, the wealthy have merely doubled their existence. We wouldn’t want them to suffer.
Point Numero Dos
Anyone who claims that minimum wage jobs are only “supposed” to be entry level is overlooking the inconvenient truth that most of them are not.
Duh. So there’s the theoretical “free market” construct where angels wearing top hats (and likely fedoras, too) dance on the heads of pins and then reality, where the shit hits the bricks.
Of course some are willing to delay, obfuscate and hypothesize until their cows come home. That’s because they get to keep the fucking cows!
So, there you have it. Were my two points obvious enough? And, hopefully, the represent a breath of fresh air in this great debate. I just hope they didn’t scare away the flies living on the decaying carcass of reason. I do not want that on my conscience!
I think the data stacks up pretty well that a reasonable minimum wage is a good thing for an economy and a society. It does, however, collide with free market economics of supply/demand in that “hey, if I can get someone to freely take a job for $6/hr, why shouldn’t I?”
I get that at some level, I really do. As with so much with for-profit businesses, it comes down to what is fair (it’s fair to pay someone a wage that they agree to) versus what it right (it’s unethical to pay someone below the poverty line).
We deal with it — not so much from the minimum wage level, but say we hire an entry-level RA. How much do we pay them? The going rate in businesses around town says ~$36k/y. We think okay, we want to be a little above average (to help with recruitment and retention), so how about $38.5k/y? Well why not 40? or 43? — well, because I want the money for other things.
I appreciate your reasoned input. Basically all I can add is, “Hella.”
I forgot to mention that Wall Street bonuses are estimated to be $23 billion this year. That’s billion. With a “B.” B is for Bonus. Source: Robert Reich.
I also forgot to include an anecdotal piece of my past. I’m fortunate to live in a state that has decided the Federal minimum wage isn’t good enough. So it voluntarily makes it higher. One year, after a jump in the state’s minimum wage took effect, the local burger joint had a sign in the window stating they had laid off staff in response. They were seriously pissed about minimum wage.
I never ate there again. See? Minimum wage can hurt the bottom line.
Those burgers were unhealthy, anyway! Good for you!
At $7.25/hr someone working a 40 hour week over the course of a year, without a two week vacation, receives $15,080 in salary, before taxes. I’d gladly pay 10 per cent more for my hamburger if the company would take 10 per cent off their profits to help their employees actually be able to afford to eat one of their own hamburgers.
I wish more people felt like you!
Of course, beyond minimum wage not just being entry level, there’s also the point that often those are the only jobs in town.
Yeah, some people seem to live in a theoretical bubble that people will only accept work that’s in their wheelhouse. Reality doesn’t work that way so it’s a crass argument.