The Role Of Government Compensation

What is our governments’ role with regard to Compensation in the U.S.?

The U.S. government plays the enactment and enforcement roles concerning compensation in organizations. They establish and enforce legislative rules and standards for compensation that ensure and protect the fair and equitable treatment of employees and their well being (Milkovich, Newman, & Gerhart, 2016, p. 614). Through the Department of Labor, and its many subordinate agencies, the government’s mission is to, “foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights” (U.S. Department of Labor,

631). The prevailing wage, determined by the U.S. Department of Labor, is the hourly rate, and subsequent benefits and overtime pay, that is paid to a majority of workers, in different job classifications (such a plumbers, electricians, etc.) in specific areas (Prevailing Wage: What You Need to Know, n.d.). According to these provisions, when a public works project funded (or assisted) by federal tax dollars is set to start in a specific area, contractors must pay their contracted workers at least the prevailing wage for the area in which the work is conducted (Milkovich, et al., p. 631). These laws apply to all public building/works contracts that are over $2,000 (U.S. Department of Labor, n.d.). This ensures that that all employers are afforded equal bidding opportunities for the contract (no contractors are afforded an unfair advantage by being able to offer the government a lower rate due to lower wages) (Prevailing Wages Law & Legal Definition, n.d.). This subsequently ensures that those employed by the contractor are not taken advantage of by receiving compensation that is less than the value of their work. These laws also help to prevent distortion of the local labor market; large-scale contracts attract a large number of skilled workers, increasing the supply of workers without an equitable increase in demand (Milkovich, et al., p.

618). This legislation sets a pay floor; companies must pay their hourly workers at least the current federal minimum wage (or the state minimum wage-whichever is higher [Milkovich, et al., p. 619]). At this wage level, minimum wage is intended to provide a wage at which an employee can sufficiently provide himself/herself. While I agree that everyone should have the ability to work and provide for himself or herself, I am on the fence concerning the necessity of minimum wage legislation. It all boils down to supply and demand. An organization must set a wage level that will entice prospective applicants to work for them. If they set a wage that is too low, they will limit the number of viable candidates applying for a position. If the organization is unable to hire a capable employee at a specific wage point, they will have to increase the wages offered. However, this is contingent on a prospective employee knowing the worth of their skills and knowledge and they possess as well as the value they can provide for a prospective employer. I am, however, against the notion of increasing minimum wage to $15.00. I believe that if an employee wishes to receive a raise, they need to demonstrate an increase in their knowledge/skills or receive a promotion to a