The Fair Labor Standards Act, signed into law in 1938, created the first nationwide rules on minimum wages, overtime pay, and child labor. It set a floor under hourly pay, required extra pay for long workweeks, and put limits on when and how children could work. Nearly nine decades later, it is still the primary federal law governing how employers must pay and treat workers in the United States, and the Department of Labor’s Wage and Hour Division enforces it.1U.S. Department of Labor. Minimum Wage
It Set a National Minimum Wage
Before 1938, there was no federal floor on what an employer could pay by the hour. The FLSA established one. When the law took effect, that floor was $0.25 per hour.2U.S. Department of Labor. History of Federal Minimum Wage Rates Under the Fair Labor Standards Act, 1938 – 2009 Congress has raised it many times since. The current federal minimum wage is $7.25 per hour, a rate in place since July 2009.1U.S. Department of Labor. Minimum Wage
The federal number is a floor, not a ceiling. When a state or local government sets its own minimum wage higher, employers must pay the higher amount.1U.S. Department of Labor. Minimum Wage Many states have done exactly that, so the effective minimum in much of the country now runs well above $7.25.
The law also carved out narrower wage rules for specific groups. Tipped employees can be paid a cash wage as low as $2.13 per hour, but the employer can only claim that tip credit if the worker’s tips bring total hourly earnings up to the full $7.25. If they fall short in a given week, the employer has to make up the difference.3U.S. Department of Labor. Minimum Wages for Tipped Employees Section 14(c) of the FLSA also lets employers apply for a special certificate to pay less than the minimum to workers whose productive capacity is impaired by a physical or mental disability that affects the specific job.4U.S. Department of Labor. Fact Sheet #39: The Employment of Workers with Disabilities at Subminimum Wages A 2024 proposal to phase out those certificates was formally withdrawn in 2025, so the program remains in effect.5Federal Register. Employment of Workers With Disabilities Under Section 14c of the Fair Labor Standards Act Withdrawal
It Required Overtime Pay After 40 Hours
The FLSA is the reason the 40-hour workweek became a legal touchstone. Under the law, a non-exempt employee who works more than 40 hours in a single workweek must be paid at least one and one-half times the regular hourly rate for every extra hour.6Office of the Law Revision Counsel. 29 U.S. Code 207 – Maximum Hours
A “workweek” for FLSA purposes is a fixed, recurring period of 168 hours, or seven consecutive 24-hour periods. It can begin on any day and at any hour the employer chooses, but once set it does not float.7eCFR. 29 CFR 778.105 – Determining the Workweek Employers cannot average hours across two or more weeks to dodge overtime. Fifty hours one week and thirty the next still owes ten hours of overtime for the first week.
The “regular rate” that overtime is calculated from is not just base hourly pay. It includes commissions, nondiscretionary bonuses, and other incentive pay, which often pushes the overtime rate higher than a straight time-and-a-half of the base wage would suggest.
Overtime disputes frequently turn on what counts as “hours worked.” The Wage and Hour Division treats on-call time on the employer’s premises as work; on-call from home, with freedom to use the time, generally is not, unless the restrictions are heavy. Travel between job sites during the workday counts, but the ordinary commute does not. Travel to another city for a single-day assignment counts, minus the normal commute. Training and meetings are work time unless they are outside normal hours, voluntary, unrelated to the job, and involve no other work.8U.S. Department of Labor. Fact Sheet #22: Hours Worked Under the Fair Labor Standards Act
It Restricted Child Labor
The FLSA set the first federal limits on child labor in non-agricultural jobs and grouped them into age tiers:
- Under 14: children generally cannot work in non-agricultural jobs covered by the FLSA, with narrow exceptions such as delivering newspapers or performing in entertainment.
- Ages 14 and 15: work is limited to non-manufacturing, non-hazardous jobs performed outside school hours, and capped at 3 hours on a school day, 18 hours in a school week, 8 hours on a non-school day, and 40 hours in a non-school week. Hours must fall between 7:00 a.m. and 7:00 p.m., extended to 9:00 p.m. from June 1 through Labor Day.9U.S. Department of Labor. Non-Agricultural Jobs – 14-15
- Ages 16 and 17: may work unlimited hours in any job the Secretary of Labor has not declared hazardous.
- Age 18 and older: no longer subject to youth employment restrictions under federal law.10U.S. Department of Labor. Fact Sheet #43: Child Labor Provisions of the Fair Labor Standards Act for Nonagricultural Occupations
Occupations declared hazardous, such as mining, roofing, and operating heavy power-driven equipment, are reserved for workers 18 and older. The rules for farm work are noticeably more relaxed than those for other industries, and children of any age can work on a farm owned or operated by their parents.11U.S. Department of Labor. Fact Sheet #40: Overview of Youth Employment (Child Labor) Provisions for Farmwork
It Defined Who Is Covered and Who Is Exempt
The FLSA’s protections do not reach every worker in the country. The law drew lines around who counts as a covered employee.
At the business level, the FLSA applies to enterprises with at least two employees and annual sales or business volume of at least $500,000. Hospitals, schools, and government agencies are covered regardless of revenue. Even where the employer does not meet the enterprise threshold, an individual worker is covered if the work regularly involves interstate commerce, such as handling goods that have moved across state lines.12U.S. Department of Labor. Fact Sheet #14: Coverage Under the Fair Labor Standards Act
The law also created categories of employees who are exempt from minimum wage and overtime. The most common are the white-collar exemptions for executive, administrative, and professional employees, who must satisfy both a salary test and a duties test.13Office of the Law Revision Counsel. 29 USC 213 – Exemptions After a November 2024 court decision vacated the Department of Labor’s 2024 overtime rule, the enforceable salary threshold reverted to the 2019 level: at least $684 per week on a salary basis, roughly $35,568 per year. A separate highly compensated employee test applies at $107,432 per year (with at least $684 per week on a salary or fee basis) and uses a simpler duties standard.14U.S. Department of Labor. Overtime Pay
Because the law’s protections attach only to employees, the line between employee and independent contractor matters enormously. Workers labeled as contractors do not get minimum wage, overtime, or child-labor protection under the FLSA. The Department of Labor uses an “economic reality” test that looks at the actual working relationship, not the contract label, weighing the employer’s degree of control and the worker’s opportunity for profit or loss most heavily, with skill, permanence, and integration into the business as additional factors. Employers who misclassify workers can be held liable for unpaid minimum wages, overtime, and liquidated damages.15U.S. Department of Labor. Misclassification of Employees as Independent Contractors Under the Fair Labor Standards Act
It Gave Workers a Way to Enforce These Rights
The FLSA did more than set standards. It gave workers real mechanisms to enforce them and made it illegal for employers to punish anyone who used those mechanisms.
If an employer underpays you, denies overtime, or breaks the child labor rules, you can file a complaint with the Wage and Hour Division by calling 1-866-487-9243 or contacting a local office. Complaints are confidential; the Division will not disclose your name or the nature of the complaint to your employer without your consent.16U.S. Department of Labor. How to File a Complaint You can also bring a private lawsuit in federal or state court. Either route can produce back pay plus an equal amount in liquidated damages, effectively doubling the recovery.17Office of the Law Revision Counsel. 29 U.S. Code 216 – Penalties
The clock matters. You generally have two years from the date of a violation to file a claim for unpaid wages. If the violation was willful, meaning the employer knew or showed reckless disregard for the law, the deadline extends to three years.18eCFR. 29 CFR 1620.33 – Recovery of Wages Due
Retaliation is separately illegal. Firing or otherwise punishing a worker for filing a complaint, cooperating with an investigation, or testifying in an FLSA proceeding is prohibited, and remedies can include reinstatement, back pay, and liquidated damages.19Office of the Law Revision Counsel. 29 U.S. Code 215 – Prohibited Acts
Civil penalties give the law teeth. Willful or repeated minimum wage and overtime violations can cost up to $2,515 per violation. Child labor violations run up to $16,035 for each minor involved, and up to $72,876 per incident where a violation causes the death or serious injury of a worker under 18, doubled for repeated or willful conduct.20Federal Register. Federal Civil Penalties Inflation Adjustment Act Annual Adjustments for 202521eCFR. 29 CFR Part 579 – Child Labor Violations, Civil Money Penalties Willful violations can also be prosecuted criminally, carrying a fine of up to $10,000, imprisonment for up to six months, or both, with prison time possible on a second conviction.
Taken together, that is what the Fair Labor Standards Act did: it put a wage floor under American work, capped the ordinary workweek at 40 hours by making anything above it more expensive, pulled children out of adult jobs, drew lines around who qualifies for those protections, and built an enforcement system to back the whole thing up.