I know Non-profits don’t have to provide minimum wage. But what about the following scenerios?
Bob owns a pizza place. He hires Steve on the stipulation in which he works 30 hours a week for $100 but gets all the free food he wants.
Or lets say a business offers a new hire of $200 per 40 hour work week, but they provide health, dental, and a very very good retirement package.
Questions and answers about the minimum wage:
I don’t see anything at that link which answers the OP’s question.
Nor do I,.
I think it does. It’s $7.25 per hour, unless you’re exempt; a pizza restaurant worker could possibly fall under the tipped class category ($2.13 per hour) but the owner’d have to pay if he didn’t actually get enough tips to reach $7.25 per hour.
However, it also depends on the business’ revenue:
Now, you could try to make the guy an independent contractor, but I wouldn’t; it’s generally not a good idea to do this if the worker is in a position normally staffed by employees. Certainly, paying for benefits would negate this possibility.
So minimum wage only applies to companies who make $500,000 or more?
What if Bob calls the pizza job an internship?
Read it again, and this time keep paying attention after the first sentence. 
No you just can’t call a job an internship and pay them nothing or less than minimum. Each state has different laws but basically your minimum is at least what the federal government says.
You have to look at your state labor laws governing internships.
Of course this doesn’t stop employers from doing very shady things.
I worked at one place where immigrants would have a visa that said their job is specifically for ONE hotel. This is opposed to some immigration visas that allow any job. Anyway, this immigrant would leave the hotel and get another job and the hotel would work out an arrangement to pay the immigrant and get the money (plus fees) from the immigrants new job.
This is wrong, but happens more than you’d think. Employer abuses are very common. But what can you do when you need a job? If you report it, chances are nothing will happen and if it does the company can get fined and because of this have to reduce work forces, etc etc
This is a jurisdictional question. The answer lies in your jurisdiction’s employment laws.
In my jurisdiction, for example, it is illegal to “contract out” of the minimum standards established by the legislation and regulations. That is, employers and employees may not agree to less than is stipulated in those statutes. Abuses can and do occur, of course; but the legislation provides for common law remedies when they do.
Not many pizza places serve areas that would cause them cross state lines, but I don’t know if prepared food falls under “goods for commerce.” Is prepared food considered goods for commerce?
Yeah, unfortunately, it you getting less than min wage at the time…
The joys of self employment…
I don’t have a factual answer, but my inkling is no. Economist Walter Williams is well known for his stance that minimum wage laws are discriminatory based on the argument that “minimum wage” is exactly that: the minimum an employer may lawfully pay an employee who is not otherwise compensated by tips. If an employer wants to hire someone at less than $7.50 per hour but can’t, some poor minority loses out because, apparently to Williams, said minority isn’t worth $7.50 in labor to the employer. Remove the requirement, though, and there goes Williams’s argument.
In the U.S., the federal minimum wage is established by the Fair Labor Standards Act (FLSA), as amended.
You don’t have to cross state lines to be engaged in interstate commerce. Since the New Deal interstate commerce is understood to be affected by commercial transactions that occur within a single state’s borders, and the argument that your commerce is wholly intrastate is almost always a loser. The federal minimum wage applies to almost every private company in the U.S. that has employees.
The whole point of the minimum wage is that employers and employees cannot agree to undercut it. As a society we’ve decided that’s exploitative of workers, and so we’ve circumscribed the types of bargains labor can strike with their employers. If a company could avoid the minimum wage by simply finding employees who agreed to take less, then there wouldn’t actually be a minimum wage.
But this doesn’t mean that every worker has to be paid $7.25 an hour. As noted above certain occupations can count as tipped, which has a lower wage paid from employer to employee so long as tips make up the difference. Some jobs are exempt from the FLSA, so you don’t have to worry about minimums or overtime at all. But these are typically professional or managerial services, and you can get in big trouble by nominally classifying a labor job as managerial just to avoid the FLSA. (It’s exceedingly rare for an exempt job to pay less than the minimum on an hourly basis – maybe it doesn’t legally exist at all. Overtime is typically at issue in the exempt/non-exempt distinction.) And independent contractors aren’t covered by the FLSA – although again, just calling someone who is really an employee an IK for purposes of avoiding the Act can get you in big trouble.
The other important issue is, as mentioned, state law. States may have higher minimum wages, or they may have a minimum that covers more employees than the FLSA. States may also have a lower minimum, in which case the FLSA governs in most cases. Occasionally state government employees might not be covered by the FLSA (not sure of the contours of this), so they’d be under the state minimum, even if it’s lower than $7.25.
As to the particular questions in the OP: I don’t know about the first one. I think that the FLSA allows some in-kind compensation, but I don’t know the precise limits; I’m sure there are some. Note also that even if the FLSA allows it, state law might have a sifferent rule. But even if compensation in kind is included, it would still have to come up to the value of the minimum wage.
As for the second, hell no. Benefits aren’t wages. There’s no general rule requiring employers to provide benefits (although in the future there will be penalties for certain employers who don’t provide health insurance). Benefits are provided b/c employers think they’re a cheaper way to compensate employees than cash (which, given the advantaged tax treatment for employer-sponsored health care, they are). But any benefits the employer chooses to give are on top of the minimum required cash money they have to pay you under the FLSA.
–Cliffy
This is obviously true for some value of the minimum wage, but the data is conclusive that it’s not true for the current minimum. The minimum wage has been raised several times in its ~80 year history, and there are many more examples of particular states raising their own minimums. In each instance the Chamber of Commerce preached fire and brimstone that it would lead to devastating unemployment. And in almost every case they were proven wrong. Often there’s no effect on employment, sometimes there’s a possible modest negative effect. (A recent-ish Wall Street Journal article claiming teenagers are particularly hit hard has been thoroughly debunked.)
In general, businesses don’t employ people they don’t have a need for – businesses don’t spend any money they don’t need to. If minimum wages go up, business don’t shed workers, because they can’t run the business without them. Instead, they raise the wages, pass some of the increased costs through to customers (and no, it doesn’t hurt GDP either – the increases have generally been too small), and take the rest of the hit in their own profits. And that’s why the Chamber whines – because it is an organization that exists to safeguard business profits at the expense of anything else. (I truly don’t mean this as a pejorative – it’s an organization of business owners; of course that’s their raison d’etre.) But society can, and should, decide that some things are more valuable than the enrichment of management, such as establishing a standard that working full time should pay enough to keep body and soul together.
–Cliffy
You must pay the required minimum wage to be legal. There are many exception wages for stuff like disabled employees or people below a certain age that lower the minimum wage. There are even things like the maximum food and housing allowance you can compensate employees. The cash payed is always required to met whatever minimum wage is appropriate for the person. Housing would be above and beyond the minimum wage just like health insurance. Businesses can make employees pay for extras like group insurance premiums they offer and so they pay less in the end, but they still have to pay them the minimum wage first. This also ensures the employee is getting appropriate credit for earned income toward their S.S. retirement and disability benefits.
Look at the Wisconsin sheet for the above examples.
I looked into the nuances of this a few years ago. I was approached by someone who wanted to intern at my business because she thought it would improve her resume. She wanted no pay.
Well, the only way my insurance would cover her was if she was a paid employee. She came back with the suggestion that I pay her $1 an hour. That would have been illegal. So she suggested that she could fill out a time sheet showing 5 hours of work each week, while she would really be present 40 hours. Nope, too many ways for me to get hurt.
In the end, I spent considerable time researching the issue and ended up telling her I couldn’t help.
In Canada, as an example - the employer might want to claim “he’s a contractor”. Then you can pay him whatever you think is appropriate.
Like the US social security, there are an array of payroll taxes that an employer pays in addition to deducting taxes. With a contractor, you just pay them (like the plumber when he comes to your house) and the contracted employee is responsible for his amount owing. The government seriously dislikes the idea of expecting a wage-earner to eventually cough up a decent share of his earnings at the end of the month or quarter when the money may be all gone, so they have rules that define contract vs. employee. (FWIW, in Canada minimum wage itself is provincial jurisdiction, but there is NO WAY you can escape paying minimum wage.)
IANAHR person, but it’s something like this: A contractor may not make a substantial amount of his money (80%+ ?) from one place; must set his own hours (i.e come and go on his own); must not be under direct supervision of the company. Basically, if he walks like an employee quacks like an employee, and has to show up like an employee, he’s an employee and must meet the minimum wage rates.
I assume the rules are somewhat similar in the USA.
So no working on the barter system? When I was in high school, during one of the summers, I worked in the pro shop at a local golf course for 6 hours on a Saturday. In exchange, I got to play golf for free the rest of the week. Was this illegal?
As the other poster mentions - in today’s litiginous society, you have to consider what is covered and not; if you were injured “on the job” worker’s compensation would not kick in, the pro shop would be liable. If their other insurance was written to exclude non-patrons, the pro shop would have to pay it all out of pocket. With today’s medical bill costs, who wants that risk?
Of course the “nudge nudge wink wink” agreement goes out the window when the parents and a lawyer get involved. A guy who owns his own business may be willing to take that risk; an employee for a larger enterprise is not allowed to commit them to open-ended liability, unlikely as it may be.
Basically you can do whatever you want as long as both sides agree and you don’t get caught; however, when the law gets involved, usually meaning the agreement has fallen apart, the minimum wage rules still apply, plus non-compliance fines. The guy who is putting his bank account on the line may not want to take that risk. (And if you are taking the work away from someone who would have gotten real wages or overtime otherwise to do that job, you are creating additional parties who may bring the agreement to the attention of authorities.)