Introducing the

Just Wage
Initiative

Just Wage Forum 2021

Criterion 1: Wage enables decent life for worker and household

A just wage covers the basics necessary for a minimally decent life for a worker and the worker’s household, including hours of work that are predictable, not excessive, and provide regular rest to facilitate a decent life away from work. Further, a just wage rests upon a healthy and safe working environment mitigating stress and facilitating flourishing, providing paid time off in the form of personal days, vacation, and in times of sickness of the worker or another household member. Ultimately, a just wage provides resources, in the form of both pay and time, that foster the worker’s self-development socially, culturally, and spiritually.

Wage enables decent life for worker and household

 

The role of government in shaping the employment relationship has always been hotly contested in the USA, and workers under the law have few protections when compared to other wealthy countries. Furthermore, labor laws vary a great deal by state and sector, so readers should view this brief essay as an introduction to a complex topic that requires further research via the links provided. (For a great introduction to the politicization of labor rights and regulations in modern US history, see Nelson Lichtenstein’s State of the Union: A Century of American Labor).

For example, the US is an outlier in offering workers no right to paid time off (vacations, holidays, or sick leave). A recent study by the Center for Economic and Policy Research termed the US the “No-Vacation Nation,” as one in four workers have no paid time off of any kind. Time away from work -- for rest, rejuvenation, family time, and self-improvement -- is an important indicator of a decent life, something millions of American workers currently lack.

Though there are a number of federal laws aimed at protecting workers from excessive exploitation and promoting aspects of a decent life, many of these landmark bills -- from the Fair Labor Standards Act (1938) to the Occupational Safety and Health Act (1970) -- are quite limited in coverage and impact.

A key example is the minimum wage, the central plank of the Fair Labor Standards Act (FLSA), which is not indexed for inflation and can only be altered by an act of Congress. Currently, the minimum wage is $7.25 an hour, where it has been since 2009. While the US minimum wage has never amounted to a “living wage,” its purchasing power has waned significantly over the years, peaking in 1968. In 2019, according to the Economic Policy Institute, the minimum wage was worth 31% less than it had been fifty years prior; meanwhile, as documented monthly by the Bureau of Labor Statistics, prices continue to increase. Further, the law does not apply to all workers, though its numbers have expanded over the years. A full list of exemptions to FLSA wage requirements can be found here.

In recent years some state and local governments have raised the minimum wage in their jurisdictions, meaning that the legal minimum wage varies greatly across the country. To compare the US minimum wage over time and to other countries in real (inflation adjusted) dollars, see this chart from the Organization for Economic Co-operation and Development.

In terms of protection from overwork, US law does not set a limit for the maximum number of hours an individual over sixteen can work (or be forced to work by an employer) in a typical work week. However, in order to reward those who work long hours in a given week (and provide a disincentive to an employer from overworking their staff), the FLSA does mandate overtime pay at rates of time-and-a-half for any hours worked above forty. While hourly workers everywhere boost their annual incomes from these overtime provisions, however, many salaried and supervisory workers are excluded from this benefit.

Until 2020, for example, salaried workers who made more than just $23,660 annually were exempt from overtime pay. According to the National Employment Law Project, while more than 65 percent of salaried workers received overtime pay in the 1970s, less than 7 percent were covered by 2019. While the Obama administration had proposed raising the annual salary threshold to $55,068 by 2022 -- covering about one-third of salaried workers -- the Trump administration instead mandated a threshold of $35,568, which is now in effect.

As with minimum wages, overtime coverage varies by age, sector, and region. A full list of federal exemptions to FLSA overtime requirements can be found here. Meanwhile, some states enforce hours or pay that are above the federal minimum. Complicating matters further, wage and hour requirements for government contracts fall outside of the FLSA, and are instead regulated by legislation including the Service Contract Act, Davis-Bacon Act, and Contract Work Hours and Safety Standards Act. Each law imposes its own rules and regulations.

In terms of workplace health and safety, the Department of Labor’s Occupational Safety and Health Administration (OSHA), established in 1970, is the main agency responsible for enforcing regulations via workplace inspections. A comparison between US federal standards and international standards can be found here; meanwhile, many states have created their own workplace safety regulations that go beyond OSHA’s minimums. Articulating standards is important, but rules are only as strong as their enforcement. Unfortunately, over the past forty years, the number of the agency’s inspectors has actually declined, while the workers under OSHA’s jurisdiction have nearly doubled. As the COVID-19 pandemic continues as of this writing, OSHA’s critics complain that it has issued only guidelines, not enforceable rules, leaving businesses too much discretion and putting workers at risk. In response, states such as Virginia have undertaken more stringent measures in the name of worker and community health.

 

This page was last updated on November 22 2021. It was written by Dan Graff, Emily Merola, Edward Prein, and Anastasia Reisinger.

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