Minimum Wage - Federal

Under the Fair Labor Standards Act ("FLSA") the Federal minimum wage is now $7.25 per hour. (29 U.S.C. s. 206)

There are subminimum wage rates for learners, students and apprentices of 85% of the minimum wage rate. (29 U.S.C. s. 214(a)&(b))

There are special subminimum rates for handicapped employees whose handicaps prevent them from earning competitive wages and for certain classes of student and apprentice employees. (29 U.S.C. s. 214(c))

An employer may credit tips towards the minimum wage if (1) the employee is paid a cash wage of not less than $2.13 per hour, (2) the employee customarily and regularly receives more than $30.00 in a month in tips, (3) the employee is informed of these provisions, and (4) the employer does not keep the tips received. (29 U.S.C. s. 203(m)(2)) (29 CFR Part 531 - Subpart D)

An employee is considered off duty and time spent in an on-call status is not considered hours of work if:

The employee is allowed to leave a telephone number or to carry an electronic device for the purpose of being contacted, even though the employee is required to remain within a reasonable call-back radius; or
The employee is allowed to make arrangements such that any work which may arise during the on-call period will be performed by another person. (5 CFR s. 551.431)

An employer may, under certain circumstances, count as wages the reasonable cost to the employer of furnishing an employee with board, lodging or other facilities. (29 U.S.C. s. 203(m))

The lodging must be furnished regularly by the employer to its employees; (29 CFR s. 531.31)
Employees must accept the lodging voluntarily and without coercion; (29 CFR s. 531.30)
The lodging must not be in violation of any Federal, State, or local laws, ordinance or prohibition; (29 CFR s. 531.31)
The employee must receive the primary benefit of the lodging. For example, the lodging is of little benefit to the employee where the employer requires an employee to live on the employer's premises to meet some need of the employer; (29 CFR s. 531.3(d)(1)) and
The employer must maintain accurate records of the costs incurred in furnishing lodging to the employee. (29 CFR s. 516.27(a))

It is unlawful for an employer to discriminate against an employee for filing a FLSA complaint. (29 U.S.C. s. 215(a)(3))

An employer who violates the FLSA is liable to the employee for the unpaid wages, an additional equal amount as liquidated damages and reasonable attorney's fees. (29 U.S.C. s. 216(b))

If the employer shows to the satisfaction of the court that the act or omission giving rise to the action was in good faith and that it had reasonable grounds for believing the the act or ommision was not a violation of the FLSA, the court may in its descretion award no liquidated damages or award any amount not to exceed those damages. (29 U.S.C. s. 260)

An action under the FLSA may be commenced with two years after the cause of action accrued except that a cause of action arising out of a willful violation may be commenced within three years. (29 U.S.C. s. 255(a))
In order for a court to determine whether an employment relationship exists, it must look to the "economic reality" of the totality of the circumstances bearing on whether the putative employee is economically dependent on the alleged employer. In doing so, it must consider whether the alleged employer (1) had the power to hire and fire the employees; (2) supervised and controlled employee work schedules or conditions of employment; (3) determined the rate and method of payment; and (4) maintained employment records. Perez v. FEMA, 173 F.4th 357 (1st Cir. 2026)
On April 27, 2021, President Biden issued an Executive Order that directed the Department of Labor to develop rules to ensure that federal contract and subcontract employees are paid a minimum of $15.00 per hour starting on January 30, 2022, and then adjusted annually to the Consumer Price Index. On November 22, 2021, the Department of Labor announced a Final Rule implementing the increased minimum wage. The Final Rule became effective January 30, 2022. On January 13, 2022, the Department of Labor issued a Field Assistance Bulletin clarifying the requirements of the new standard.

On January 21, 2022, the Office of Personnel Management issued a Memorandum for Heads of Executive Departments and Agencies implementing a $15 per hour minimum pay rate for Federal employees effective January 30, 2022.