The history of minimum wage is about the attempts and measures governments have made to introduce, ascertain, uphold and enforce a

minimum wage A minimum wage is the lowest remuneration that employers can legally pay their employees—the price floor below which employees may not sell their labor. List of countries by minimum wage, Most countries had introduced minimum wage legislation b ...

New Zealand

New Zealand New Zealand () is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and List of islands of New Zealand, over 600 smaller islands. It is the List of isla ...

enacted the first national

minimum wage law Minimum wage law is the body of law which prohibits employers from hiring employees or workers for less than a given hourly, daily or monthly minimum wage. More than 90% of all countries have some kind of minimum wage legislation. History Until ...

s in 1894 by the '' Industrial Conciliation and Arbitration Act'', which, unlike the wages board of Victoria, established arbitration boards to enforce compulsory arbitration.

Australia

In 1896, the

Colony of Victoria The Colony of Victoria was a historical administrative division in Australia that existed from 1851 until 1901, when it federated with other colonies to form the Commonwealth of Australia. Situated in the southeastern corner of the Australian ...

amended the ''Factories and Shops Act'' to create a wages board. The wages board did not set a universal

; rather it set basic wages for six industries that were considered to pay low wages. First enacted as a four-year experiment, the wages board was renewed in 1900 and made permanent in 1904; by that time it covered 150 different industries.Waltman, Jerold. "The Politics of the Minimum Wage." University of Illinois Press. 2000 By 1902, other Australian jurisdictions, such as

New South Wales New South Wales (commonly abbreviated as NSW) is a States and territories of Australia, state on the Eastern states of Australia, east coast of :Australia. It borders Queensland to the north, Victoria (state), Victoria to the south, and South ...

and

Western Australia Western Australia (WA) is the westernmost state of Australia. It is bounded by the Indian Ocean to the north and west, the Southern Ocean to the south, the Northern Territory to the north-east, and South Australia to the south-east. Western Aust ...

, had also formed wages boards. In 1907, the Harvester decision was handed down in Australia. It introduced the influential idea of a ' living wage' for a man, his wife, and three children to "live in frugal comfort". In 1912, the ''Industrial Arbitration Act'' of

South Australia South Australia (commonly abbreviated as SA) is a States and territories of Australia, state in the southern central part of Australia. With a total land area of , it is the fourth-largest of Australia's states and territories by area, which in ...

provided at section 22 that: ''The Court shall not have power to order or prescribe wages which do not secure to the employee affected a living wage. "Living wage" means a sum sufficient for the normal and reasonable needs of the average employee living in the locality where the work under consideration is done or is to be done.'' Following that law, the South Australian Industrial Court would periodically declare what a living wage was in South Australia, as follows: On 14 December 2005, the Australian Fair Pay Commission was established under the Workplace Relations Amendment ( WorkChoices) Act 2005. The responsibility of the commission includes the setting of the standard federal minimum wage, replacing the role of the Australian Industrial Relations Commission that took submissions from a variety of sources to determine appropriate minimum wages. The Australian Fair Pay Commission was replaced by Fair Work Australia in 2010, later renamed the Fair Work Commission.

United Kingdom

The minimum wage was a major factor in British industrial relations from 1909 until the 1930s. After a study of the minimum wage laws in Australia and New Zealand the

Liberal Party The Liberal Party is any of many political parties around the world. The meaning of ''liberal'' varies around the world, ranging from liberal conservatism on the right to social liberalism on the left. For example, while the political systems ...

acted to set up a minimum wage in the most heavily sweated or underpaid industries, as part of a broad range of social reforms.

Winston Churchill Sir Winston Leonard Spencer Churchill (30 November 1874 – 24 January 1965) was a British statesman, military officer, and writer who was Prime Minister of the United Kingdom from 1940 to 1945 (Winston Churchill in the Second World War, ...

, president of the

Board of Trade The Board of Trade is a British government body concerned with commerce and industry, currently within the Department for Business and Trade. Its full title is The Lords of the Committee of the Privy Council appointed for the consideration of ...

, introduced the Trade Boards Act in 1909. It created boards that set minimum wage criteria that were legally enforceable. The main provision was to set minimum wages in certain trades with the history of low wages, because of surplus of available workers, the presence of women workers, or the lack of skills. At first it applied to four industries: chain-making, ready-made dresses, paper-box making, and the machine-made lace and finishing trade. About 70 per cent of their 200,000 workers were women. Coal mining was added in 1912, after a major strike. In 1913, five additional wage boards were set up that covered hollow ware making, shirt making, sugar confectionery and food preserving, tin box making, and linen and cotton embroidery, along with a portion of the laundry industry. These extensions covered an additional 140,000 workers. Unions pushed for the 1918 Act to greatly extend the coverage of minimum wages. In 1917, "Whitley councils" or Joint Industrial Councils were established in 41 industries with over 2 million employees to bring together unions and management to discuss not only wages and conditions but also a wide range of related issues such as jobs, security, benefits and technical education. Starting in 1909, Liberals, led especially by David Lloyd George, promoted the idea of a minimum wage for farm workers. Resistance of landowners was strong, but success was achieved by 1924. According to Robin Gowers and Timothy J. Hatton, the impact In England and Wales was significant. They estimate that it raised wages for farm labourers by 15 per cent by 1929, and by more than 20 per cent in the 1930s. It reduced the employment of such labourers by 54,000 (6.5 per cent) in 1929 and 97,000 (13.3 per cent) in 1937. They say, "The minimum wage lifted out of poverty many families of farm labourers who remained employed, but it significantly lowered the incomes of farmers, particularly during the 1930s." By the 1920s, a new perspective was offered by reformers emphasising the usefulness of

Family Allowance Child benefit or children's allowance is a social security payment which is distributed to the parents or guardians of children, teenagers and in some cases, young adult (psychology), young adults. Countries operate different versions of the benefi ...

(later renamed "Child Benefit") targeted at low-income families to relieve poverty without distorting the labour market. The trade unions and the Labour Party adopted this view. In 1945, family allowances were introduced; minimum wages faded from view. Talk resumed in the 1970s, with an agricultural minimum wage remaining, but in the 1980s the Thatcher administration made it clear it would not accept a national minimum wage. Finally, with the return of Labour, the National Minimum Wage Act 1998 set a minimum of £3.60 per hour, with lower rates for younger workers. It largely affected workers in high turnover service industries such as fast food restaurants, and members of ethnic minorities.

United States

In 1912, the state of

Massachusetts Massachusetts ( ; ), officially the Commonwealth of Massachusetts, is a U.S. state, state in the New England region of the Northeastern United States. It borders the Atlantic Ocean and the Gulf of Maine to its east, Connecticut and Rhode ...

, United States, set minimum wages for women and children, and some states enacted similar protective laws. Under the Massachusetts laws, there was "the power only to investigate conditions and recommend changes". In the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

, statutory minimum wages were first introduced nationally in 1938 by president Franklin D. Roosevelt. ''Note: Date enacted was 1 April 1999'' In addition to the federal minimum wage, nearly all states within the

have their own minimum wage laws with the exception of

Alabama Alabama ( ) is a U.S. state, state in the Southeastern United States, Southeastern and Deep South, Deep Southern regions of the United States. It borders Tennessee to the north, Georgia (U.S. state), Georgia to the east, Florida and the Gu ...

Louisiana Louisiana ( ; ; ) is a state in the Deep South and South Central regions of the United States. It borders Texas to the west, Arkansas to the north, and Mississippi to the east. Of the 50 U.S. states, it ranks 31st in area and 25 ...

Mississippi Mississippi ( ) is a U.S. state, state in the Southeastern United States, Southeastern and Deep South regions of the United States. It borders Tennessee to the north, Alabama to the east, the Gulf of Mexico to the south, Louisiana to the s ...

South Carolina South Carolina ( ) is a U.S. state, state in the Southeastern United States, Southeastern region of the United States. It borders North Carolina to the north and northeast, the Atlantic Ocean to the southeast, and Georgia (U.S. state), Georg ...

, and

Tennessee Tennessee (, ), officially the State of Tennessee, is a landlocked U.S. state, state in the Southeastern United States, Southeastern region of the United States. It borders Kentucky to the north, Virginia to the northeast, North Carolina t ...

. Twenty-nine states have a minimum wage that is higher than the federal minimum wage.

Latin America

In 1930, Getúlio Vargas established a minimum wage in

Brazil Brazil, officially the Federative Republic of Brazil, is the largest country in South America. It is the world's List of countries and dependencies by area, fifth-largest country by area and the List of countries and dependencies by population ...

with a new set of work laws In

Mexico Mexico, officially the United Mexican States, is a country in North America. It is the northernmost country in Latin America, and borders the United States to the north, and Guatemala and Belize to the southeast; while having maritime boundar ...

, the Constitution of 1917 decreed that "there shall be a minimum wage," but no enabling legislation was enacted until President Abelardo L. Rodríguez began pushing for it in August 1933. The minimum wage in Mexico was signed into law later that year, taking effect on 1 January 1934. In the 1960s, minimum wage laws were introduced into

Latin America Latin America is the cultural region of the Americas where Romance languages are predominantly spoken, primarily Spanish language, Spanish and Portuguese language, Portuguese. Latin America is defined according to cultural identity, not geogr ...

as part of the

Alliance for Progress The Alliance for Progress () was an initiative launched by U.S. President John F. Kennedy on March 13, 1961, that aimed to establish economic cooperation between the U.S. and Latin America. Governor Luis Muñoz Marín of Puerto Rico was a close ...

; however these minimum wages were, and are, low. p. 342.

European Union developments

In the

European Union The European Union (EU) is a supranational union, supranational political union, political and economic union of Member state of the European Union, member states that are Geography of the European Union, located primarily in Europe. The u ...

, 21 member states currently have national minimum wages.

Eurostat Eurostat ("European Statistical Office"; also DG ESTAT) is a department of the European Commission ( Directorate-General), located in the Kirchberg quarter of Luxembourg City, Luxembourg. Eurostat's main responsibilities are to provide statist ...

(2006): ''Minimum Wages 2006 - Variations from 82 to 1503 euro gross per month
(PDF)
Many countries, such as

Norway Norway, officially the Kingdom of Norway, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. The remote Arctic island of Jan Mayen and the archipelago of Svalbard also form part of the Kingdom of ...

Sweden Sweden, formally the Kingdom of Sweden, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. It borders Norway to the west and north, and Finland to the east. At , Sweden is the largest Nordic count ...

Finland Finland, officially the Republic of Finland, is a Nordic country in Northern Europe. It borders Sweden to the northwest, Norway to the north, and Russia to the east, with the Gulf of Bothnia to the west and the Gulf of Finland to the south, ...

Denmark Denmark is a Nordic countries, Nordic country in Northern Europe. It is the metropole and most populous constituent of the Kingdom of Denmark,, . also known as the Danish Realm, a constitutionally unitary state that includes the Autonomous a ...

Germany Germany, officially the Federal Republic of Germany, is a country in Central Europe. It lies between the Baltic Sea and the North Sea to the north and the Alps to the south. Its sixteen States of Germany, constituent states have a total popu ...

Austria Austria, formally the Republic of Austria, is a landlocked country in Central Europe, lying in the Eastern Alps. It is a federation of nine Federal states of Austria, states, of which the capital Vienna is the List of largest cities in Aust ...

Italy Italy, officially the Italian Republic, is a country in Southern Europe, Southern and Western Europe, Western Europe. It consists of Italian Peninsula, a peninsula that extends into the Mediterranean Sea, with the Alps on its northern land b ...

, and

Cyprus Cyprus (), officially the Republic of Cyprus, is an island country in the eastern Mediterranean Sea. Situated in West Asia, its cultural identity and geopolitical orientation are overwhelmingly Southeast European. Cyprus is the List of isl ...

have (or had) no minimum wage laws, but rely on employer groups and

trade union A trade union (British English) or labor union (American English), often simply referred to as a union, is an organization of workers whose purpose is to maintain or improve the conditions of their employment, such as attaining better wages ...

s to set minimum earnings through

collective bargaining Collective bargaining is a process of negotiation between employers and a group of employees aimed at agreements to regulate working salaries, working conditions, benefits, and other aspects of workers' compensation and labour rights, rights for ...

. In July 2014

began legislating to introduce a federally mandated minimum wage law, the ''Gesetz zur Regelung eines allgemeinen Mindestlohns (Mindestlohngesetz - MiLoG)'' (unofficial translation: "Act Regulating a General Minimum Wage (Minimum Wage Act)"), which came into effect on 1 January 2015. The minimum wage is set at €8.50 per hour. A French law passed in the

National Assembly In politics, a national assembly is either a unicameral legislature, the lower house of a bicameral legislature, or both houses of a bicameral legislature together. In the English language it generally means "an assembly composed of the repr ...

on 17 February 2015 and effective from the end of 2015 imposed statutory minimum wage regulations on foreign truck drivers plying international routes to and from France and undertaking cabotage in the country. The

European Commission The European Commission (EC) is the primary Executive (government), executive arm of the European Union (EU). It operates as a cabinet government, with a number of European Commissioner, members of the Commission (directorial system, informall ...

introduced an infringement procedure against France and Germany on 19 May 2015, arguing that the application of these laws in the

transport Transport (in British English) or transportation (in American English) is the intentional Motion, movement of humans, animals, and cargo, goods from one location to another. Mode of transport, Modes of transport include aviation, air, land tr ...

sector had a disproportionately restrictive impact on the freedom to provide services and the free movement of goods, two of the principal freedoms on which the

is based. On 16 June 2016 the Commission sent a letter of formal notice to the French authorities on this subject and issued a supplementary letter to the German authorities, initiating two months' notice of potential legal action.European Commission
Press Release: Transport: Commission takes legal action against the systematic application of the French and German minimum wage legislation to the transport sector
accessed 6 August 2016

Switzerland

In May 2014,

Switzerland Switzerland, officially the Swiss Confederation, is a landlocked country located in west-central Europe. It is bordered by Italy to the south, France to the west, Germany to the north, and Austria and Liechtenstein to the east. Switzerland ...

was overwhelmingly defeated in a

referendum A referendum, plebiscite, or ballot measure is a Direct democracy, direct vote by the Constituency, electorate (rather than their Representative democracy, representatives) on a proposal, law, or political issue. A referendum may be either bin ...

concerning a proposal to set the minimum wage at 22

Swiss franc The Swiss franc, or simply the franc, is the currency and legal tender of Switzerland and Liechtenstein. It is also legal tender in the Italian exclave of Campione d'Italia which is surrounded by Swiss territory. The Swiss National Bank (SNB) iss ...

s ($25), which would have given the country the world's highest minimum wage.

References

{{reflist, 2

External links

Federal Minimum Wage
United States Department of Labor Wage and Hour Division. As of July 24, 2009.
History of the United States' Minimum Wage
Minimum-Wage.org. Retrieved May 17, 2011. Minimum wage

Australian labour law United States labor law Late modern economic history