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Secretary of Labor Thomas E. Perez
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Wages

Merit Pay

Merit pay, also known as pay-for-performance, is defined as a raise in pay based on a set of criteria set by the employer. This usually involves the employer conducting a review meeting with the employee to discuss the employee's work performance during a certain time period. Merit pay is a matter between an employer and an employee (or the employee's representative).

The Fair Labor Standards Act (FLSA) does not require or address the issue of merit pay.