Answer to Question #158890 in Microeconomics for Zulqarnain

Question

minimum wage law

Answer 1

The Minimum Wage Act is a body of law that prohibits employers from hiring employees or workers for lower hourly, daily, or monthly minimum wages. More than 90% of all countries have some kind of minimum wage legislation.

Until recently, minimum wage laws were usually very strict. In the US and UK, for example, they only apply to women and children. It was only after the Great Depression that many industrialized countries extended them to the workforce as a whole. Even then, laws often applied to specific industries. In France, for example, they were extensions of existing trade union legislation. In the United States, industry-wide wage restrictions were ruled unconstitutional. The Fair Labor Standards Act of 1938 established a uniform national minimum wage for non-agricultural and uncontrolled workers. Coverage was later extended to cover most of the workforce.

The first steps in legislative regulation of wages did not set a minimum wage; rather, the laws created arbitration commissions and councils to resolve labor conflicts before resorting to strikes.