Shift differentials are premium rates paid by an employer for shift work. Although pay differentials can be offered in any field of employment, they are more commonly found in industries that are capital intensive, that have shortages in labor categories and that require 24-hour operations or processes. Examples are the medical and manufacturing industries.
The Fair Labor Standards Act (FLSA) does not require an employer to pay a shift differential to acquire or retain an employee for shift work. Wages are agreements made between employers and employees.
Shift Differential Trends
Pay differentials can be researched as far back as World War I. In recent years, pay premiums are less common than they were in the early 1980s. Employers may find that in today's labor market, employees who are less marketable or have less education are more likely to accept jobs that require non-standard hours without being paid a shift differential.
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