The National Directory of Certified Public Accountants

Ask A CPA - Business Start-ups

How Do I Decide On Wage Levels ?

You must pay an employee minimum wage. The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA). Many states also have minimum wage laws. In cases where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages. The FLSA does not provide wage payment or collection procedures for an employee's usual or promised wages or commissions in excess of those required by the FLSA. However, some states do have laws under which such claims (sometimes including fringe benefits) may be filed. The Department of Labor’s Wage and Hour Division administers and enforces the federal minimum wage law. You may consult with your local CPA or trade associations to learn more about the current practices in your business field.

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