In 1938, the US Fair Labor Standards Act (FLSA) instituted a nationwide minimum wage rate that sets a minimum hourly payment amount for qualified employees across the country. Established at 25 cents per hour, it has since been increased 22 times. Congress last raised the federal minimum wage rate on July 24, 2009 to $7.25, which is roughly $15,000 per year for a 40-hour work week.
Over time the majority of states have passed their own minimum wage laws. When there is a state established minimum wage rate in addition to the federal rate, an employee will generally receive the higher of the two rates (the applicable minimum wage rate). For example, if the state rate is $7 and the federal rate is $7.25, the qualified employee would receive $7.25 per hour.