A minimum wage is the lowest remuneration that employers can legally pay their employees—the price floor below which employees may not sell their labor. Most countries had introduced minimum wage legislation by the end of the 20th century. Because minimum wages increase the cost of labor, companies often try to avoid minimum wage laws by using gig workers, by moving labor to locations with lower or nonexistent minimum wages, or by automating job functions. Minimum wage policies can vary significantly between countries or even within a country, with different regions, sectors, or age groups having their own minimum wage rates. These variations are often influenced by factors such as the cost of living, regional economic conditions, and industry-specific factors.
In the United States, Social Security is the commonly used term for the federal Old-Age, Survivors, and Disability Insurance (OASDI) program and is administered by the Social Security Administration (SSA). The Social Security Act was passed in 1935, and the existing version of the Act, as amended, encompasses several social welfare and social insurance programs.
Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any other entity, pays the other, the employee, in return for carrying out assigned work. Employees work in return for wages, which can be paid on the basis of an hourly rate, by piecework or an annual salary, depending on the type of work an employee does, the prevailing conditions of the sector and the bargaining power between the parties. Employees in some sectors may receive gratuities, bonus payments or stock options. In some types of employment, employees may receive benefits in addition to payment. Benefits may include health insurance, housing, disability insurance. Employment is typically governed by employment laws, organisation or legal contracts.
Unemployment benefits, also called unemployment insurance, unemployment payment, unemployment compensation, or simply unemployment, are payments made by authorized bodies to unemployed people. In the United States, benefits are funded by a compulsory governmental insurance system, not taxes on individual citizens. Depending on the jurisdiction and the status of the person, those sums may be small, covering only basic needs, or may compensate the lost time proportionally to the previous earned salary.
United Kingdom labour law regulates the relations between workers, employers and trade unions. People at work in the UK have a minimum set of employment rights, from Acts of Parliament, Regulations, common law and equity. This includes the right to a minimum wage of £10.42 for over-23-year-olds from April 2023 under the National Minimum Wage Act 1998. The Working Time Regulations 1998 give the right to 28 days paid holidays, breaks from work, and attempt to limit long working hours. The Employment Rights Act 1996 gives the right to leave for child care, and the right to request flexible working patterns. The Pensions Act 2008 gives the right to be automatically enrolled in a basic occupational pension, whose funds must be protected according to the Pensions Act 1995. Workers must be able to vote for trustees of their occupational pensions under the Pensions Act 2004. In some enterprises, such as universities or NHS foundation trusts, staff can vote for the directors of the organisation. In enterprises with over 50 staff, workers must be negotiated with, with a view to agreement on any contract or workplace organisation changes, major economic developments or difficulties. The UK Corporate Governance Code recommends worker involvement in voting for a listed company's board of directors but does not yet follow international standards in protecting the right to vote in law. Collective bargaining, between democratically organised trade unions and the enterprise's management, has been seen as a "single channel" for individual workers to counteract the employer's abuse of power when it dismisses staff or fix the terms of work. Collective agreements are ultimately backed up by a trade union's right to strike: a fundamental requirement of democratic society in international law. Under the Trade Union and Labour Relations (Consolidation) Act 1992 strike action is protected when it is "in contemplation or furtherance of a trade dispute".
Payroll taxes are taxes imposed on employers or employees, and are usually calculated as a percentage of the salaries that employers pay their employees. By law, some payroll taxes are the responsibility of the employee and others fall on the employer, but almost all economists agree that the true economic incidence of a payroll tax is unaffected by this distinction, and falls largely or entirely on workers in the form of lower wages. Because payroll taxes fall exclusively on wages and not on returns to financial or physical investments, payroll taxes may contribute to underinvestment in human capital, such as higher education.
A salary is a form of periodic payment from an employer to an employee, which may be specified in an employment contract. It is contrasted with piece wages, where each job, hour or other unit is paid separately, rather than on a periodic basis. Salary can also be considered as the cost of hiring and keeping human resources for corporate operations, and is hence referred to as personnel expense or salary expense. In accounting, salaries are recorded in payroll accounts.
The National Minimum Wage Act 1998 creates a minimum wage across the United Kingdom. From 1 April 2023, the minimum wage is £10.42 for people aged 23 and over, £10.18 for 21- to 22-year-olds, £7.49 for 18- to 20-year-olds, and £5.28 for people under 18 and apprentices.
Employee benefits and benefits in kind, also called fringe benefits, perquisites, or perks, include various types of non-wage compensation provided to employees in addition to their normal wages or salaries. Instances where an employee exchanges (cash) wages for some other form of benefit is generally referred to as a "salary packaging" or "salary exchange" arrangement. In most countries, most kinds of employee benefits are taxable to at least some degree. Examples of these benefits include: housing furnished or not, with or without free utilities; group insurance ; disability income protection; retirement benefits; daycare; tuition reimbursement; sick leave; vacation ; social security; profit sharing; employer student loan contributions; conveyancing; long service leave; domestic help (servants); and other specialized benefits.
Piece work or piecework is any type of employment in which a worker is paid a fixed piece rate for each unit produced or action performed, regardless of time.
Social welfare has long been an important part of New Zealand society and a significant political issue. It is concerned with the provision by the state of benefits and services. Together with fiscal welfare and occupational welfare, it makes up the social policy of New Zealand. Social welfare is mostly funded through general taxation. Since the 1980s welfare has been provided on the basis of need; the exception is universal superannuation.
In United States government contracting, a prevailing wage is defined as the hourly wage, usual benefits and overtime, paid to the majority of workers, laborers, and mechanics within a particular area. This is usually the union wage.
Leisure Employment Services Ltd v HM Revenue & Customs [2007] EWCA Civ 92 is a UK labour law case on the interpretation of the National Minimum Wage Act 1998. It concerns the extent to which an employer may make deductions from a worker's basic wage entitlement for the purpose of accommodation costs. The effect is that deductions for heat and light bills may not go beyond the maximum deduction rate for accommodation cost.
The Fair Labor Standards Act of 1938 29 U.S.C. § 203 (FLSA) is a United States labor law that creates the right to a minimum wage, and "time-and-a-half" overtime pay when people work over forty hours a week. It also prohibits employment of minors in "oppressive child labor". It applies to employees engaged in interstate commerce or employed by an enterprise engaged in commerce or in the production of goods for commerce, unless the employer can claim an exemption from coverage. The Act was enacted by the 75th Congress and signed into law by President Franklin D. Roosevelt in 1938.
MacCartney v Oversley House Management [2006] IRLR 514 is a UK labour law case regarding the National Minimum Wage Act 1998.
Wage theft is the failing to pay wages or provide employee benefits owed to an employee by contract or law. It can be conducted by employers in various ways, among them failing to pay overtime; violating minimum-wage laws; the misclassification of employees as independent contractors; illegal deductions in pay; forcing employees to work "off the clock", not paying annual leave or holiday entitlements, or simply not paying an employee at all.
Employer compensation in the United States refers to the cash compensation and benefits that an employee receives in exchange for the service they perform for their employer. Approximately 93% of the working population in the United States are employees earning a salary or wage.
Uber BV v Aslam [2021] UKSC 5 is a landmark case in UK labour law and company law on employment rights. The UK Supreme Court held the transport corporation, Uber, must pay its drivers the national living wage, and at least 28 days paid holidays, from the time that drivers log onto the Uber app, and are willing and able to work. The Supreme Court decision was unanimous, and upheld the Court of Appeal, Employment Appeal Tribunal, and Employment Tribunal. The Supreme Court, and all courts below, left open whether the drivers are also employees but indicated that the criteria for employment status was fulfilled, given Uber's control over drivers.
A wage subsidy is a payment to workers by the state, made either directly or through their employers. Its purposes are to redistribute income and to obviate the welfare trap attributed to other forms of relief, thereby reducing unemployment. It is most naturally implemented as a modification to the income tax system.
Royal Mencap Society v Tomlinson-Blake [2021] UKSC 8 is a UK labour law case, concerning the right to be paid, when an employer constrains their worker's freedom.
