On May 25, 2007, President George Bush signed into law a supplemental appropriations bill ( H.R. 2206 : P.L. 110-28 ) which included an increase in the federal minimum wage under the Fair Labor Standards Act (FLSA). It was the first such increase in a decade. Under P.L. 110-28 , among other things, the federal minimum wage, which had been $5.15 per hour, is increased in steps to $5.85 per hour on July 24, 2007 $6.55 per hour on July 24, 2008 $7.25 per hour on July 24, 2009. In addition, the bill raised wages in two insular territories of the Pacific: the Commonwealth of the Northern Mariana Islands and American Samoa. The level of wages in the islands will rise at different rates to equal the federal minimum. Under the FLSA, an increase in the minimum wage has been the element around which other aspects of the act have clustered. It was often the vehicle for consideration of overtime pay, child labor, industrial homework, and similar issues that are a part of the FLSA. The federal minimum wage, now having been raised, may, perhaps, be dormant for a time. This could provide an opportunity, absent a more sustained pressure for a new rate increase, to examine the basic concept of the Fair Labor Standards Act and its various component parts. This report discusses a few of the topics that, collectively, make up the FLSA. In some cases, the report is historical because there is a long and, often, important history to the evolution of the act. On other occasions, it tends to focus upon the administration of the act and the interpretation of provisions which Congress has left, largely, to the discretion of the Secretary of Labor. This report also considers judicial decisions which, inevitably, make up a substantial part of wage/hour issues and have an impact upon enforcement of the statute. The several issues discussed, here, are suggestive and by no means definitive. None of these issues needs to be taken up in the sense that they are obligatory; and, indeed, the Congress may choose not to address any of them. For many of these issues, general CRS background papers exist and are listed in the footnotes. Under current law, a sub-minimum wage at $4.25 per hour is allowed for youth workers (under 20 years of age) through the first 90 consecutive days of employment with an employer. No change was made by the 2007 amendments. During the 1960s and 1970s (when major employers of youth workers such as retail and service industries were brought under the FLSA), the issue of a youth sub-minimum wage became extremely active. Proponents of the concept (most notably from the hotel and restaurant industries, but other segments of the economy as well) urged that youth workers be paid at a rate lower than the standard minimum wage, regardless of experience or the quality of work they performed. The period was marked by a very high youth unemployment rate: especially among black teenagers. Some suggested that, by reducing the wage rate, more young workers could be employed. Others charged that the plan was one more general reduction in wages—and a chipping away at the minimum wage. Further, in a market overflowing with willing workers, reducing the wage floor would seem to benefit chiefly employers who might otherwise hire youth workers at the full minimum. The concept of a reduced wage for youth had been pending for a number of years; but, it seems only to have been given serious attention during the 1960s and later as industry took up its advocacy. Conversely, organized labor and civil rights groups were strongly opposed, suggesting that the 'minimum wage' was truly that minimal. Any further reduction would be inequitable and counter-productive, they argued. During the Nixon Administration (1972), Representative John Erlenborn (R-IL) proposed an 80% sub-minimum, but the initiative failed. In 1974, Erlenborn and Representative John Anderson (R-IL) presented a new proposal but that, too, failed. To that date, the initiative had been associated, largely, with Republicans; but, in 1977, two Democrats became sponsors: Representatives Robert Cornell (D-WI) and Paul Simon (D-IL). The Cornell/Simon proposal called for employment of youth, less than 19 years-of-age, for up to six months at a rate of 85% of the standard minimum wage—a proposal that some viewed as opening up the labor market to disadvantaged youth. Representative Parren Mitchell (D-MD), a member of the Congressional Black Caucus, though "exceedingly grateful for the keen interest that is now being demonstrated in minority youth employment," argued that a youth differential would be a mistake, observing that "unemployment is chronic and endemic and deep across the board in the black community, and it does not make any sense at all to play one group of workers off against another." Again, the effort failed, as did other similar proposals during the period. President-elect Ronald Reagan (1980) was believed to support a youth sub-minimum wage. He had been widely quoted to the effect that the minimum wage, per se, had "caused more misery and unemployment than anything since the Great Depression." As the new Administration commenced, various hearings were conducted on the issue but, again, without legislative success. Representative Erlenborn viewed the issue as a standoff: that some will want a higher minimum wage for all workers; that others will call for a sub-minimum rate for youth. For either side, it may have been "too high a price to pay." It would be a stand-off that would continue throughout the Reagan Presidency. What had been 'a sub-minimum wage' gradually evolved into 'a youth opportunity wage' by the 1980s, and then, once more, morphed into 'a training wage' by the late 1980s and 1990s. The concept was still the same: lowering wages would produce jobs for young persons. When George H. W. Bush became President in 1989, he agreed to sign a new minimum wage increase if, among other things, it included a general sub-minimum wage for workers beginning new employment. Congress balked and the President vetoed the measure. There followed a new round of hearings and negotiations. After extended reconsideration, Congress presented the President with a new bill, which he did sign and which contained a sub-minimum wage for youth. The youth wage was initially $3.35 per hour and after April 1, 1991, not less than $3.35 an hour or 85% of the otherwise standard rate, whichever is higher. The program was divided into two parts and focused upon youth under 20 years-of-age. Part one covered "a cumulative total of 90 days" at the sub-minimum wage with no conditions beyond those imposed by the employer and a youth's willingness to accept the work. Part two was more complex. It involved an additional 90-day period and included a training wage component. At the close of 180 days, a regular minimum wage (or more, at the employer's discretion) would be required for the employee. The program was experimental, to begin on April 1, 1990, and to end on April 1, 1993. At the end of the trial period, the Secretary of Labor was to provide Congress with an assessment. As it turned out, almost no one used the training wage and it was not extended. In 1996, minimum wage legislation came up as a floor amendment to a bill containing tax and other considerations. The sub-minimum wage for youth was just one of its provisions. Following floor debate and approval in the House, the measure was forwarded to the Senate. Negotiations continued in the Senate and, ultimately, the measure was passed with the sub-minimum wage in place. The bill was subsequently signed into law by President William Clinton ( P.L. 104-188 ). As enacted, the bill allowed an employer to pay a youth (under 20 years of age) a sub-minimum wage of $4.25 per hour through the first 90 consecutive days of employment with an employer. Having set the youth rate for persons under 20 years of age, Congress then raised the general minimum to $5.15 an hour, but without linking the youth worker option to the new standard. When, in May 2007, Congress again raised the general minimum wage, no mention was made of a sub-minimum wage for youth. Thus, under current law, a youth may be hired at $4.25 cents an hour. Legislatively, the youth rate is a separate issue from the general wage floor. During the 1960s and 1970s, the FLSA was progressively expanded to cover retail and service employees. Some of these workers were 'tipped employees' and, their employers argued, that since they were given tips by the public, they (the employers) should not be required to pay such employees a full minimum wage. As things stand (under the tip credit provisions of the FLSA), all covered workers do receive at least the federal minimum wage. Of that wage, at least $2.13 per hour must come directly from the employer. The employer may have to include a higher amount in order to supplement tips that the employee receives (i.e., to make up for a deficiency). But, whatever tip income the worker receives, employers must pay at least $2.13 per hour. Through the years, the level of the tip credit (the difference between $2.13 per hour and the minimum wage) has varied. How much of a tipped worker's wage should be accounted for through tips; how much should be paid directly by the employer? Speaking generally, organized labor (and tipped employees) may be said to prefer a zero tip credit: the standard minimum wage should be paid directly by the employer. Whatever income is derived from tips, they suggest, should be the property of the tipped employee.