Minimum wage developed alongside other labor laws throughout modern history to become a standard in the American business world. While widespread, minimal wage laws are not without detractors and those who offer different means of providing a fair income. One major complaint among these economists and politicians is that minimum wage laws can create wages that are simply unhealthy for small businesses to maintain, especially in unskilled positions that would otherwise require cheap laborers.
One problem that comes from a basic wage system is that there are both federal and state rates, meaning that there is no particular consensus that matches the larger market trends. While some systems, particularly those that refuse state minimum laws, are well-suited to deal with downward market trends, these systems also do not provide the protection of a basic wage when the economy improves. Conversely, high wage states require businesses to pay problematic wage amounts in recessions, leading to lay-offs and other serious financial stability issues.
In order to balance out some of these concerns, minimum wage law permits employers to legally subtract tips and similarly additional wages from the average wage. This means that unskilled service-sector labor that is necessary for certain businesses’ operation can remain employed even when the economic environment is unforgiving. In the case of agricultural jobs, wages are generally matched according to the overall productivity and value of the crops, meaning that a fair wage is often met for a fair product.
Although there is a generally understood idea of lowest-level payment nationwide, the execution of each state’s wage laws differs. As a result, an employee familiar with one system may not be paid appropriately if they move to another state and do not know the laws there. This kind of employee wage theft is not only abusive, but illegal. For more information, contact an employment lawyer.