[truecougarblue]

Something Jack said made me want to ask this question. How many different ways are there for employers to get around the minimum wage laws in the US and other countries?

Please cite examples.

[Dreamtwister]

I heard something on CNN today that basically said corporations were increasing unpaid internship positions by 75%.

I always thought that was pretty slick...getting someone to work for you for free, and thank you for the privilege.

[Byron100]

Same way they do now, by paying under the table. Convenient way to avoid those pesky FICA taxes too...LOL.

Also, an employer will prolly just pay by the job...you do xxx for $xx. Traditional 9-5 jobs with salary and benes will probably become very, very scarce.

Further enticements to do a good job might be actual things the worker needs, like food grown from local garden, various items the employer no longer wants / needs, etc.

[alecifel]

Well, in times of rising prices they just inflate out the wage. That is to say, the cost of gas goes up, a worker's rent and grocery bills goes up, and his electric bill goes up; the employer charges more for the hamburger and fries, but when it comes time to give a raise, they say "sorry, business isn't good enough". That effectively gets around minimum wage (which is determined by cost of living) by not adjusting for increases in cost of living.

So in 2010, the minimum wage will still be $7.25. It will probably still be $7.25 in 2015. In 2010 you'll be able to get about a gallon and a half of gallon with that (assuming it gets up to $5 by then); in 2015 you will be lucky to get a half gallon.

Fact of the matter is, though that minimum wage in the US, no matter how you cut it, is an exhorbitant salary in most of the world and that is why there are no poor people in the US.

[Jack]

The first step is to emphasize "work ethic" and "team oriented", which really means work for free. So the employee is made an assistant manager, hence salaried. They work 80 hrs. per week, get paid for 40, and everyone is happy. Sorta.

The second step would be to put employees on comission, giving them pay on a percentage or piece-work basis.

Third step - cease to have employees. Volunteers will work for tips - just like WalMart in Mexico.

[Denny]

I was surprised to see at work how recently in the employee newspaper, one of our stations was celebrated for the great team effort in coming in on the weekend to paint the place.

But, what a reward! The paper showed a picture of the station manager taking them out for a coffee and donuts at the end of the day. And a free handshake!

I also can see how the trap is being sprung with work at home programs. Getting work done off site, leads to the next easy step of contractor status. One of the tests of employee status by the labor department is using the employers premises.

Not to be cynical.

[SILENTTODD]

What was the saying in the old Soviet Union? 'They pretend to pay us, and we pretend to work'.

[kpeavey]

By fall I intend to sell off this house, buy some land, preferably with a house on it. Spare rooms will be let out for room and board in exchange for 20 hours /week labor around the farm.

Build a garage, make it livable, more labor, same deal.

I have a camper, same deal

I can get all the labor I want for the cost of electricity and some toilet paper.

Solar PV wipes out the light bill.
I have lots of toilet paper already on hand.

[vision-master]

Fact of the matter is, though that minimum wage in the US, no matter how you cut it, is an exhorbitant salary in most of the world and that is why there are no poor people in the US.

No poor people in the US? That's a good one.

[MarkJ]

I don't know anyone including teenagers that work for minimum wage, but many employers deal with wage inflation by raising prices, shopping for cheaper suppliers, outsourcing, offshoring, subcontracting, hiring more productive employees, eliminating less productive employees, eliminating unnecessary employees, eliminating overpaid employees, cutting benefits, cutting hours, reducing product quality/quantity/size, increasing sales volume and replacing workers and/or increasing efficiency through better communications, management, computerization and wageless robotic automation.

[Dreamtwister]

Fact of the matter is, though that minimum wage in the US, no matter how you cut it, is an exhorbitant salary in most of the world and that is why there are no poor people in the US.

No poor people in the US? That's a good one.

Relatively speaking, of course. Remember, most of the world lives on less than $2/day.

[Peleg]

Noone mentioned immigrant labor. I expect many businesses to be recruiting illegals in the next few years. That is part of why GW wants the guest worker program. Do you really think they are going to guarantee those people minimum wage? In most places if you could get willing Mexicans to leaglly work for minimum you are cutting your labor costs in half at least. That is what I see coming. American's out of work.

[MrBill]

I don't know anyone including teenagers that work for minimum wage, but many employers deal with wage inflation by raising prices, shopping for cheaper suppliers, outsourcing, offshoring, subcontracting, hiring more productive employees, eliminating less productive employees, eliminating unnecessary employees, eliminating overpaid employees, cutting benefits, cutting hours, reducing product quality/quantity/size, increasing sales volume and replacing workers and/or increasing efficiency through better communications, management, computerization and wageless robotic automation.

It is a good list. You might have added moving up the competitive ladder with high quality, value-added products along with increasing sales volume. Profits pay worker's salaries as well as shareholders for their capital.

Becoming more efficient = more competitive. Being more competitive = staying in business. Staying in business = jobs. Going out of business = no jobs. No job = no minimum wage.

Some may prefer no job. Some may prefer to work harder for less. Some may prefer to work for themselves. Living standards in the USA peaked in 1973. The rest of the western world was not far behind. Now we all work harder for our daily bread.

Ironically, Germany just implemented a minimum wage this year (or last?). Up to now they were perfectly fine without one. Just because there is a minimum wage in place (France) does not mean workers are better off. Not if they do not have a job that is. Not if the minimum wage contributes to inflation either.

[Byron100]

One thing I'd like to add is that I think that average productivity of the American worker will drop sharply as the standard of living falls...what incentive does an average person have to work at peak performance if they're going to be making less and less money (in actuality) over time?

Sure, there is the threat of being fired...which is how companies are currently goading workers to work "harder", but that tactic really doesn't work over the long term. People need positive reasons to work, not constant threats.

In any case, we'll be moving from mass employment to people working on their own any way they possibly can (including Wal-mart pests), as well as becoming wards of the state, as some have suggested. I do suspect that many of the newly unemployed will drink themselves to death, as they'll have nothing to live for (which is what happened after the collapse of the USSR).

[MrBill]

So there is money to be made brewing homemade vodka (samagon) for sale when and where discouraged workers congregate to drown their sorrows. Riverbanks, parks, abandoned buildings, disused parking lots, railyards, etc.

Baba grows the potatoes at the dacha. Dedushka distills it into samagon. The kids come out on weekends to dig potatoes. They bring it back to town. They sell it for a nickel or two a glass. Everyone feels better. Even if they're worse off. Natural selection will eventually work its magic, and a new equilibrium will be reached.

ETO ZHIZN'! Ce'st la vie!

[MarkJ]

One of our family businesses is one of the largest private employers in the area. They've always paid substantially more than the minimum wage since you can't find semi-skilled, semi-productive, semi-trainable high school graduates with a drivers license & good work ethic that can pass a drug test/background check that are willing to work for less than 10 bucks an hour. The most productive employees work at the larger distribution warehouses where they pay 15 to 18 bucks an hour.

Many of the proponents of higher minimum wages simply want higher pay, but they don't want to work harder, smarter etc. When wages increase, productivity must increase as well unless your employer, their customers and/or coworkers can carry you or absorb the loss.

What's funny is that many of the people complaining about low paying jobs, don't want the higher paying jobs since they require education, skills, training, hard work, high productivity, drug testing, background checks etc.

I'm amazed how many people don't have basic skills, a high school diploma, drivers license and can't pass a drug test and background check. We see people showing up for job interviews with neck tattoos, piercings, backwards baseball hats, ripped jeans, exposed boxer shorts.......

[MrBill]

My father always told me, "Show up for the interview dressed like you're ready to go to work."

That may be a clean plaid shirt, clean jeans and work boots. Or it may be in suit and tie with polished shoes. Dress like you mean it, and try to make a good first impression.

That's just the basics. Sadly, so many think that a job is a right and not a privilege.

I cleaned bricks, salvaged lumber, unloaded boxcars, pushed broom and cleaned toilets at campsites. I did every job well and took pride in every job well done. The rest came through hardwork and effort.

Post peak oil I will get up early and dig potatoes, mend fences, pitch bails, or pound nails, so long as I can. Actually, pretty much what my stepfather does in his retirement in any case. There is no shame in a job well done, and a lot of satisfaction looking back at a hard day's work when you can see what you have done. My father called it, 'sweat equity'.

[Kingcoal]

Getting around the minimum wage is easy, just don't hire any employees. I think that the demand for employees will drop until we have Depression era unemployment. If an employer needs help, he can just hire temps. Temps aren't technically employees so minimum wage laws don't apply. Regardless, temps tend to make much more than the minimum wage anyway. The reason is that they are not a liability for an employer. The traditional employer/employee relationship is like a marriage, meaning that you just can't kick people to the curb without repercussions. Firing people requires cause, which isn't easy to prove in court. Laying people off is expensive, because you have to pay them unemployment. On top of that, employees have all kinds of other costs and liabilities; for example, they can sue an employer for discrimination. Temps are easy, they just show up on the books as an expense, nothing more. When the employer is done with them; adios. For that reason, I've noticed that more and more traditional employers are turning to using temps long term. That can have some gotchas when it comes to the IRS, but from what I see, it's becoming a new trend.

[Byron100]

Getting around the minimum wage is easy, just don't hire any employees. I think that the demand for employees will drop until we have Depression era unemployment. If an employer needs help, he can just hire temps. Temps aren't technically employees so minimum wage laws don't apply. Regardless, temps tend to make much more than the minimum wage anyway. The reason is that they are not a liability for an employer. The traditional employer/employee relationship is like a marriage, meaning that you just can't kick people to the curb without repercussions. Firing people requires cause, which isn't easy to prove in court. Laying people off is expensive, because you have to pay them unemployment. On top of that, employees have all kinds of other costs and liabilities; for example, they can sue an employer for discrimination. Temps are easy, they just show up on the books as an expense, nothing more. When the employer is done with them; adios. For that reason, I've noticed that more and more traditional employers are turning to using temps long term. That can have some gotchas when it comes to the IRS, but from what I see, it's becoming a new trend.

That's something that I think we'll see a lot more of, too. I would think it'd be a good idea for the government to fold FICA into the traditional income tax and / or a national sales tax, and make all employment expenses deductible. Also, benes should be counted as taxable income, to further level the playing field between "traditional" 9-5 employees and "free agents".

Personally, I just do not see how 20th century corporate culture can even survive in the post-peak era. All those paper-pushers and meeting ringleaders, who'll have nothing to show for their efforts, all those salespeople whose numbers go down each year, or the UPS driver who will have no more packages to deliver...all of those people will most certainly be out of a job, and by extension, their career. Someday, the word "career" will be used in a historical context, to describe how people actually did the same kind of work their entire lives, the concept of which will be a bit bewildering to the multi-skilled kids of future generations.

Oh well, that's all fine and dandy with me, as I ain't got a "career".

[MarkJ]

The traditional employer/employee relationship is like a marriage, meaning that you just can't kick people to the curb without repercussions. Firing people requires cause, which isn't easy to prove in court. .

Unless you live in an Employment-At-Will State.

Q: Can an employee be fired without due cause?

A: Yes. New York State is an "employment-at-will," state. Without a contract restricting termination (such as a collective bargaining agreement) an employer has the right to discharge an employee at any time for any reason. This also protects the employee's right to resign. An employer may fire an employee for "no reason" - or even for a reason that might seem arbitrary and unfair -- and the employee is equally free to quit at any time without being required to explain or defend that decision.


There are a few exceptions to "employment-at-will." The most significant of these are laws, enforced by the New York State Division of Human Rights, which prohibit discrimination based upon race, creed, national origin, age, handicap, gender, sexual orientation or marital status.