Human Resources: Employment Laws and Employee Rewards
Law dictates some basic elements of business relationships and wages are no exception. Employers must adhere to certain minimum requirements, particularly if they wish to do business with the federal government. These laws both help and hinder a company's ability to attract, motivate and keep employees.
How Laws Affect Wages (Specific private sector examples)
Laws govern some parameters of some basic elements in the employer-employee relationship and one of those basic elements is compensation. Perhaps the most obvious example is the minimum wage of at least $7.25 and the overtime pay of 1 1/2 times the employee's normal hourly rate for every hour above 40 hours per week (except for exempt employees), both mandated by the Fair Labor Standards Act (FLSA) (Business & Legal Resources, 2014). Furthermore, some states require an even higher minimum wage be paid (Business & Legal Resources, 2014). Huge corporations like McDonald's, Corp. rely on a very large work hourly force that is paid the federal minimum wage of $7.25/hour; however, there have been recent employee protests that the current minimum wage is inadequate to meet their basic needs (Rosenthal, 2014). In fact, McDonald's workers were urging $15.00/hour minimum wage but McDonald's understandably resisted and is able to rely on the $7.25/hour federal minimum wage. Recently, however, McDonald's CEO has stated that McDonald's will be able to manage an increase in the federally mandated minimum wage to $10.10/hour (Rosenthal, 2014). In this case, the FLSA directly impacts the wages that McDonald's Corp. must pay to thousands of its hourly employees.
The FLSA is merely one example of laws affecting wages. For example, the Davis-Bacon Act (U.S. Department of Labor, n.d.), the Walsh-Healey Public Contracts Act (PCA) (U.S. Department of Labor, n.d.), and the McNamara-O'Hara Service Contract Act (SCA) (U.S. Department of Labor, n.d.), all give the federal government leverage in controlling wages paid to employees: if...
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