The Federal Labor Law Guide

Minimum wage is the lowest hourly pay rate that employers are legally obligated to pay employees. The Fair Labor Standards Act (FLSA) dictates the federal minimum wage, which is:

$7.25 per hour for most employees in 2024

Tipped minimum wage is the lowest hourly pay rate employers are legally obligated to pay employees who earn a significant portion of their income through tips. 

Federal tipped minimum wage: $2.13 per hour

This can be combined with tips to make up the federal minimum wage of $7.25 per hour. This is often referred to as a "tip credit".

The FLSA is the federal law that governs overtime pay. It requires employers to pay nonexempt employees at least 1.5 times their regular rate of pay for all hours worked over 40 in a workweek. 

Exceptions
Some employees are exempt from overtime pay under federal law. These include the following categories of workers:

• Certain employee roles in exempt executive, administrative, and professional roles may not be eligible for overtime

• Certain outside sales reps

• Certain computer employees

• Highly compensated employees

The FLSA does not require meal or rest breaks. However, if a FLSA-covered employer chooses to offer short breaks (usually between 5 and 20 minutes in length), federal law requires that they be paid. Longer meal breaks (30 minutes or longer) are typically unpaid and do not count as time worked.

Vacation leave
Federal law does not require private employers to provide paid or unpaid vacation leave. If an employer wants to offer their employees paid or unpaid vacation leave, it is the employer’s choice and would be governed by the employer’s policies or the employment contract.

Sick Leave
The FLSA does not require employers to offer paid sick leave to their employees. However, the federal Family and Medical Leave Act (FMLA) applies to companies with 50 or more employees and provides up to 12 weeks of unpaid leave to covered employees. FMLA leave may be used for a variety of purposes including the birth, adoption or placement for foster care care of a child, an employee’s or an immediate family members serious health condition, and certain military-related reasons. Check out the Department of Labor’s website for more information on the FMLA. 

Holidays
The FLSA doesn’t require private employers to provide paid or unpaid holiday leave. If an employer wants to offer paid or unpaid holiday leave to their employees, it is up to the individual employer, and would be governed by company’s policy or the employee’s contract.

The FLSA’s child labor provisions restrict the types of work and hours of work of minors under the age of 18. A summary of key federal child labor laws follows:

Minors under 14 are only allowed to do the following jobs:

• Newspaper delivery

• Babysitter on a casual basis

• Actor in movies, TV, radio or theater

• Homeworker gathering evergreens or making evergreen wreaths

• Work for a business owned entirely by their parents (but not a hazardous occupation)

Minors 14-15 years of age can only work outside school hours in non-manufacturing and non-hazardous jobs. Federal law states that these minors cannot work:

• More than 3 hours on a school day, including Friday;

• More than 18 hours per week when school is in session;

• More than 8 hours per day when school is not in session;

• More than 40 hours per week when school is not in session; and

• Before 7:00 AM or after 7:00 PM on any day, except from June 1 through Labor Day, when nighttime work hours are extended to 9:00 PM.

Minors 16-17 years of age may work in any job that has not been declared hazardous by the federal Secretary of Labor. They can also be employed for unlimited hours provided they are paid appropriate minimum wage and overtime. 

Federal law permits employers to pay employees who are under 20 years of age $4.25 per hour during their first consecutive 90 calendar days of working.

Hiring
As of 2024, there is no federal pay transparency law or ban the box law for private employers. Federal agencies and contractors are required to comply with the Fair Chance to Compete for Jobs Act of 2019, however, which disallows employers from asking about a job applicant’s criminal history until after a condition job offer has been extended. 

Firing
Federal law allows “at will” employment for private employers. This means that employers and employees can end the employment relationship at any time, for any reason, without notice. However, employers may not terminate employment for an unlawful reason including but not limited to discrimination based on race, national origin, disability, age, gender, or genetic information; retaliation for reporting illegal or unsafe work practices; or refusing to conduct illegal activities.