what is minimum wage

Minimum wage is the lowest amount of money that employers can legally pay their employees for their work. The federal minimum wage for covered nonexempt employees in the United States is $7.25 per hour. However, many states have their own minimum wage laws, and some states have a higher minimum wage than the federal rate. The minimum wage for employees who receive tips is $2.13 per hour, but if the amount of tips plus the $2.13 does not reach at least $7.25 per hour, the employer must pay to make up the difference. The minimum wage rates vary greatly across different jurisdictions, not only in setting a particular amount of money but also in terms of which pay period or the scope of coverage. Some states and cities set their own minimum wage rates, and if the federal and local government minimum wages are different, the higher wage rate applies.