Clinton vs. Trump: What the Election Means for Wage and Hours Laws

Both candidates have fueled their campaigns with populist messages about wealth inequality. The facts back them up. Based on data drawn from the Current Population Survey 1963-2014, the top 10% of family income gradually rose from $139,677 in 1993, $163,139 in 2003, and $159,002 in 2013 (a 13.9% increase from 1993-2013). At the 50th percentile, income was virtually flat over 20 years: $54,971 in 1993, $61,318 in 2003, and falling to $56,971 in 2013 (a 3.6% increase from 1993-2013). For people in the 10th percentile, income was $12,976 in 1993, rising to $14,530 in 2003, and falling to $12,951 in 2013 (a decrease of less than .01%). Credit: Urban Institute (click here).

The official campaign website for Donald Trump states: “Hourly earnings and weakly (sic) earnings are lower today than they were in 1973.”  Except for misspelling weekly, and apart from not explaining that his statement adjusts for inflation, he is correct. He makes no direct policy suggestion to raise wages.

Hillary Clinton is not much more detailed, but her website promises to “make the minimum wage a living wage and fight for equal pay.” Her spelling is correct, however.

As for wage and hour policies, because Trump offers no hint of a suggestion, it’s hard to predict what type of change could occur.

Here is what might be expected if Clinton is elected.

Executive Order on Wage Equality: In January 2016, the Obama administration announced executive action that would require companies with 100 employees or more to report to the federal government how much they pay their employees broken down by race, gender, and ethnicity. It’s plausible that she would go further than requiring reporting of data. Recall that Bill Clinton issued an executive order, applicable to federal contractors that would bar them from doing business with the U.S. government if they hired permanent striker replacements (for more, see my article in Boston College Law Review, located here. Eventually, the order was struck down by the D.C. Court of Appeals. See here for details.
That would not necessarily deter Hillary Clinton from issuing an executive order to the multitude of companies that do business with the U.S.—ranging from selling peanut butter in federally funded school programs to making advanced computer systems for the Department of Defense— to equalize pay across gender, race, and ethnicity.
The goal is worthy but assumes that pay disparity is caused entirely by intentional practices that have disparate effects. The labor market offers fewer African-Americans and Latinos who have advanced degrees, compared to whites. An executive order that simply counts race and ethnicity without adjusting for legitimate human capital factors would not only be impractical but likely cause a leveling of pay that would undermine incentives for acquiring more training and education.

Increase in Minimum Wage: July 24, 2009 was the last time the federal minimum wage was raised under the Fair Labor Standards Act (to $7.25 per hour). Congress seriously considered raising the minimum wage in 2014 when Democrats proposed a rate of $10.10 per hour. A raft of state and local laws have raised the minimum wage. The biggest change since 2014 is Bernie Sanders’ signature success in putting the $15 an hour concept to a test for voters in dozens of primaries. His message played very well, and it therefore seems to set the stage for the next figure taken up by Congress.