75 years ago today, President Roosevelt signed the Fair Labor Standards Act of 1938 (FLSA) into law. For the first time in history, the federal government guaranteed men and women a minimum wage and overtime pay, extending basic workplace protections to all as a matter of law — an important step forward for the labor movement and for women’s equality, as many state minimum wage laws enacted in previous decades had only applied to women. However, while not exclusively geared towards women, the FLSA has contributed greatly to the economic empowerment of women in this country.
The legislative victory of the FLSA came after years of negotiations spearheaded by the legendary Secretary of Labor Frances Perkins. After joining President Roosevelt in 1933 as the first female cabinet member in history, Secretary Perkins set out to establish a “floor under wages and a ceiling over hours” [PDF, p. 34] for all American workers. President Roosevelt shared her conviction: “Our Nation so richly endowed with natural resources and with a capable and industrious population should be able to devise ways and means of insuring to all our able-bodied working men and women a fair day’s pay for a fair day’s work.”
When Congress enacted the FLSA in 1938, it boldly promised workers fair wages and hours, but limited that promise in scope. A late version of the FLSA “contained the bare essentials [Secretary Perkins] could support” and Congress stripped the final version even further, resulting in a series of exemptions to limit the types of industries that needed to comply with the Act (like agriculture). However, the FLSA has been amended several times, and, with each amendment, Congress has renewed the effort to fully implement its original goal of a fair day’s pay for all working men and women — with varying degrees of success. Three of these initiatives particularly affected the lives of working women:
- The 1961 Amendments: Shift to Enterprise Coverage
In 1961, Congress expanded coverage under the FLSA for the first time since 1938. That expansion entitled 3.6 million additional men and women to the labor protections promised in the original act. Most of these workers gained access to the FLSA through the newly created “enterprise coverage,” in conjunction with changes to exemptions that ensured large retail establishments would be covered. Before 1961, the FLSA only covered workers individually involved in interstate commerce; the enterprise coverage amendment “shift[ed] the focus from an employee’s activity to the nature of an employer’s business” so that all workers employed by an “enterprise” involved in interstate commerce were entitled to protections, regardless of their individual job functions.
This amendment was important for women in at least two ways. First, like President Roosevelt, President Kennedy reiterated that women workers were included in these protection expansions: “I don’t believe that there’s any American who believes that any man or woman should have to work in interstate commerce, in companies of substantial size, for less than [the minimum wage].” Second, by expanding coverage in this way, Congress reached women-dominated employment fields. For example, most newly covered workers underpaid at the time of the expansion worked in “retail trade.” That industry includes jobs like retail salespersons, and women made up nearly 60% of those workers in the 1960s. However, some major industries – such as restaurants and hotels — remained exempt from the FLSA under exceptions to the enterprise coverage amendment.
- The 1966 Amendments: Coverage Expansion Adds Unfortunate Tipped Minimum Wage
Congress made further strides in expanding coverage to women workers in its 1966 amendment to the FLSA, which expanded the definition of enterprise coverage to include a wider variety of institutions like schools and hospitals, and eliminated the exemption for some enterprises, including restaurants and hotels. This amendment reached 8 million additional workers, and many of these newly covered workers were women, as President Johnson observed in his signing remarks: “the charwomen, the people who make your beds, the mother who leaves her children at 5 o’clock in the morning…that works in the cafes, the hotel and motel employees, the laundry workers that clean our shirts…”
However, while it expanded overall coverage, this amendment also created the tipped minimum wage — a change that ultimately has had the effect of reducing wages, especially for women. In 1966, the tipped wage allowed employers of employees receiving more than $20 per month (now $30) in tips to be paid a cash wage equal to at least 50% of the current minimum wage, with the rest of their wage coming from tips. At the time, this was a net gain for workers like restaurant servers who were previously excluded [PDF, p. 7] from any coverage at all — but over time, the value of the tipped minimum wage has eroded, especially since Congress changed the calculation in 1996 to fix the cash wage at $2.13 per hour. (President Clinton, notably, did not agree with that provision despite signing the bill into law.) As a result, the tipped wage remains at $2.13 today and tipped workers often face higher rates of poverty compared to the overall labor force. Women suffer disproportionately from the low tipped wage since most tipped workers are restaurant servers and 71% of servers are women.
- The 1974 Amendments: Coverage Expansion for Some Domestic Workers… and an Exclusion for Others
The 1974 Amendments to the FLSA brought some of the most significant coverage improvements for women, especially women of color. Previously, domestic workers were not covered under the FLSA unless they worked for a qualifying enterprise. That meant domestic workers employed in “private” homes had no labor protections. Congress changed this in 1974 by expanding coverage to domestic service employees working in households. Given that nearly all domestic workers were women, and disproportionately women of color, the expansion was seen “as an expression of respect for these women’s dignity and equality and the importance of the work they performed, and a rejection of the stereotype-laden societal perceptions about such work.”
Unfortunately, this expansion came with a big catch. In combination with creating coverage for domestic workers, Congress developed an exemption so that domestic workers who provided either “babysitting services” or “companionship services for individuals” would not be covered. Congress intended for this exemption to be narrow (applying, for example, to a person who visits and reads to her elderly neighbor); however, as the home care industry expanded, the exemption grew to exclude an estimated 1.7 million home care workers. Adding insult to injury, the exemption took away FLSA coverage from domestic workers employed by third-party agencies and placed in private homes who were previously protected under the FLSA’s enterprise coverage. For more information on the Department of Labor’s proposed rules to address this issue as well as action steps to take in support of home care workers, click here!
Collectively, these three changes represent the great advancements made under the FLSA, as well as the need for ongoing improvements. As President Kennedy said, “This doesn’t finish the job, but it is a most important step forward…” So let’s celebrate the FLSA’s Diamond Jubilee by sending Congress a message that we support raising the minimum wage (including the minimum wage for tipped workers), expanding coverage for home care workers, and finishing the job Secretary Perkins started.