Legal Definitions - Fair Minimum Wage Act of 2007

The Fair Minimum Wage Act of 2007 is a United States federal law that significantly increased the national minimum wage. This Act specifically amended the existing Fair Labor Standards Act (FLSA) to mandate a series of incremental raises. Its primary effect was to elevate the federal minimum wage from $5.15 per hour in 2007 to $7.25 per hour by 2009, establishing a new baseline for worker compensation across the country.

• Imagine Maria, who worked part-time at a local diner in 2008, earning the then-federal minimum wage of $6.55 per hour. When the Fair Minimum Wage Act of 2007 mandated the next increase, Maria's hourly pay automatically rose to $7.25 per hour in July 2009, without her needing to negotiate for it. This example demonstrates how the Act directly increased the earnings of minimum wage workers, providing them with a higher standard of pay as required by federal law.

• Consider "The Corner Bookstore," a small independent business operating in a state that had previously aligned its minimum wage with the federal standard. Before the Act, the bookstore paid its entry-level employees $5.15 per hour. As the Fair Minimum Wage Act of 2007 phased in its increases, the bookstore's owner had to adjust their payroll budget to ensure all eligible employees were paid at least $5.85 per hour in 2007, then $6.55 in 2008, and finally $7.25 per hour by 2009. This illustrates how the Act compelled businesses to comply with the new federal wage floor, impacting their operational costs and budgeting.

• Let's look at "Harmony State," which in 2007 had a state minimum wage of $5.00 per hour, lower than the federal rate. Even though Harmony State had its own minimum wage law, employers within the state were legally required to pay their workers at least the federal minimum wage. When the Fair Minimum Wage Act of 2007 raised the federal minimum wage to $5.85 in 2007, then $6.55 in 2008, and finally $7.25 in 2009, employers in Harmony State had to adhere to these higher federal rates, effectively overriding their lower state minimum. This shows how the Act established a federal floor, ensuring that even in states with lower local minimum wage laws, workers would still receive the federally mandated higher pay.