What do minimum-wage laws, child-labor laws, and overtime-pay laws have in common other than that they originated in the Fair Labor Standards Act (FLSA) of 1938?
The FLSA established a national minimum wage of 25¢ an hour, mandated time-and-a-half for overtime in certain jobs, prohibited most child labor, and established a 44-hour work week, which was lowered to 40 hours in 1940.
Although the federal minimum wage has risen to $7.25 per hour, states are permitted to enact a higher minimum wage, depending on their constitutions. For several years now, more than half of the states have had minimum wages higher than the federal minimum. Twenty-one states are increasing their minimum wage this year. The largest increases are in Illinois (21.21%), New Mexico (20%), Washington (12.5%), and New Jersey (10%). Some states have passed legislation to gradually raise their minimum wages to $15 an hour over the next few years. On the federal level, the Democrat-controlled House of Representatives passed a bill (H.R.582) last summer, the “Raise the Wage Act,” to raise the federal minimum wage to $15 an hour by 2025 and adjust it annually thereafter. However, the bill has never been considered by the Republican-controlled Senate. Nearly every Democratic candidate for president has expressed support for a federal minimum wage of $15 an hour.
The fast-food hamburger chain Wendy’s was recently fined for violating child-labor laws in Massachusetts. Wendy’s agreed to pay $400,000 after investigators found that the company had allowed teenage employees at dozens of Massachusetts restaurants to work later and longer than allowed by law. Investigators “estimated more than 2,100 violations” at 46 Wendy’s locations across the state. An investigation by the U.S. Department of Labor also recently resulted in Wendy’s being fined for violating child-labor laws. This time it was a Kentucky-based franchisee with Wendy’s restaurants in Colorado, Florida, Kansas, Kentucky, Minnesota, Missouri, Nebraska, Tennessee, and Wisconsin. Investigators found that “446 minors worked before 7:00 a.m. or after 7:00 p.m. on school nights, worked more than 3 hours on a school day or worked more than 8 hours on a non-school day.” The FLSA “limits the hours and the times of day that 14 and 15-year-olds can work to no more than three hours on a school day and no more than 18 hours during a week when school is in session.” It also restricts working hours to hours between 7 a.m. and 7 p.m. “Child-labor laws exist to ensure that when young people work, the work does not jeopardize their health and well-being or educational opportunities,” said a Wage and Hour bureaucrat in Kentucky.
The number of workers eligible for overtime pay is growing this year by 1.3 million people. Federal law has always required that hourly workers (with some exceptions) who work more than 40 hours in a week be eligible for overtime pay of time-and-a-half. But until this year, only salaried workers who earned less than $23,660 annually were eligible for overtime pay. In 2015, the Obama administration proposed more than doubling the overtime exemption threshold to $50,400. On July 6 of that year, the U.S. Department of Labor announced a Notice of Proposed Rulemaking concerning overtime pay. Business groups and twenty-one Republican-controlled states sued the Obama administration before the rule was to take effect in 2016. The rule was then put on hold and finally blocked by a federal judge in Texas in 2017. The Trump administration then proposed raising the overtime-exemption threshold to $35,568. The Labor Department issued its final rule last September, and it took effect on January 1 of this year. Democrats are not happy about the new threshold, since it affects only 1.3 million Americans and not 2.8 million other Americans who would have benefited under the original rule proposed by the Obama administration.
Would there be minimum-wage laws in a free society? Would there be child-labor laws in a free society? Would there be overtime-pay laws in a free society?
Of course not.
The Constitution nowhere authorizes the federal government to have an FLSA. And on the federal, state, and local levels, it is not the proper role of government to dictate wage and hour standards, mandate certain employee benefits, regulate the free market, or intervene in the economy.
But does that not mean that everyone would be working for subsistence wages, children would be working all hours of the day and night, and no one would ever get paid overtime?
Of course not.
Currently — with minimum-wage laws, child-labor laws, and overtime-pay laws — just a small percentage of Americans currently work for the federal minimum wage, most teenagers don’t work until they are at least 16, and some companies pay overtime on a daily basis, pay double time in certain instances, or offer increased pay for working nights — none of which is required.
And just look at what else the government doesn’t require.
According to the U.S. Department of Labor’s “Handy Reference Guide to the Fair Labor Standards Act,”
While the FLSA does set basic minimum wage and overtime pay standards and regulates the employment of minors, there are a number of employment practices which the FLSA does not regulate. For example, the FLSA does not require
- vacation, holiday, severance, or sick pay;
- meal or rest periods, holidays off, or vacations;
- premium pay for weekend or holiday work;
- pay raises or fringe benefits; or
- a discharge notice, reason for discharge, or immediate payment of final wages to terminated employees.
Then it says about the practices that the FLSA doesn’t require, “The above matters are for agreement between the employer and the employees or their authorized representatives.”
That is exactly how it should be when it comes to wages, working hours, and overtime pay. That is exactly how it would be in a free society.
In a free society, there would be no Fair Labor Standards Act.
In a free society, there would be no U.S. Department of Labor.
In a free society, there would be no federal, state, or local minimum-wage laws.
In a free society, there would be no government-mandated 40-hour work week.
In a free society, there would be no government overtime-pay requirements.
In a free society, there would be no child-labor laws.
In a free society, government would not interfere in any way with the employer-employee relationship.
Minimum-wage laws, child-labor laws, and overtime-pay laws are a triple threat to the free market and a free society.