Federal Minimum Wage 2026

What Is the Federal Minimum Wage?

The federal minimum wage is the lowest hourly wage employers covered by the Fair Labor Standards Act (FLSA) may legally pay most workers in the United States. It has been set at $7.25 per hour since 2009-07-24, making 2026 the longest stretch without a federal increase in the law's history. When a state or city sets a higher minimum wage, employers must pay the highest rate that applies to their location.

Who Does FLSA Cover?

The FLSA applies to "enterprise" and "individual" coverage. Enterprise coverage applies to businesses with at least $500,000 in annual gross sales that engage in interstate commerce (which includes nearly all businesses that use mail, card payments, or the internet). Individual coverage applies to employees who personally engage in interstate commerce, regardless of employer size. Hospitals, schools, and federal, state, and local government agencies are covered regardless of revenue. Some small, purely intrastate businesses fall outside FLSA, but virtually all workers remain protected by their state's minimum wage law.

Federal Tip Credit Rules

Under federal law, employers of tipped employees may pay a direct cash wage as low as $2.13/hr and claim a maximum tip credit of $5.12/hr, as long as the employee's tips make up the difference to reach the full $7.25/hr minimum. If an employee's combined direct wages and tips fall short in any workweek, the employer is legally required to make up the shortfall. Many states (including California, Washington, Oregon, Minnesota, Alaska, and Nevada) do not allow a tip credit at all, and require tipped employees to be paid the full state minimum wage before tips.

A tip credit lets an employer count a portion of an employee's tips toward meeting its minimum wage obligation, but the employee's direct wages plus tips must still equal at least the full minimum wage every workweek.

Federal Exempt Salary Threshold (2026)

To qualify for the FLSA "white-collar" exemption from overtime pay (covering executive, administrative, and professional employees), a salaried worker must earn at least $684/week ($35,568/year) in 2026 and satisfy the relevant duties test. Employees earning less than this threshold generally must be paid overtime for hours worked beyond 40 per week, regardless of job title. Several states, including New York, California, Washington, and Colorado, set their own higher exempt salary thresholds that override the federal minimum for employers operating in those states.

Federal Minimum Wage History: 1938–2026

Congress has raised the federal minimum wage 22 times since the FLSA created it in 1938. The table below shows every rate change in the law's history.

States Paying Above the Federal Minimum Wage

30 states currently set a minimum wage higher than the federal floor of $7.25/hr. The remaining 20 states default to the federal rate.

States at the federal floor: Alabama, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Wisconsin, Wyoming.

Frequently Asked Questions