A national minimum wage is a specified minimum wage that regulates the amount of money that employees within that country must be paid. Many countries throughout the world, including the United Kingdom and the United States, have established national minimum wages. In the United States, the federal minimum wage was $7.25, as of 2010. However, the federal minimum wage increases over time, to address the increase in living costs.
There are frequently periods in which federal minimum wage amounts are frozen. Nevertheless, over time, the national minimum wage will climb. The first federal minimum wage established in the United States was created in 1938. At this time, the minimum wage was set at 25 cents. Since this period, the national minimum wage has increased substantially.
The national minimum wage is established by the United States federal government. Every state has the authority to create an independent minimum wage. However, if a state decides to exercise this authority, the minimum wage that is created must exceed the value of the federal minimum wage. Otherwise, a state will utilize the minimum wage established by the federal government. In some instances, a city may be permitted to establish a minimum wage that exceeds the minimum wage that was previously created by the state in which it is located.
This can occur if an the cost of living in that city is exceptionally high. It is also important to note that jobs in which employees receive tips, such as waiting tables or hairdressing, are not covered in the same way. In instances such as these, an employee can receive a low hourly salary, as long as his/her income exceeds the federal minimum wage when tips are added.