Minimum price controls can be placed not only on commodities, but also on labor services, resulting in market surpluses of such services. Such controls are commonly known as minimum-wage laws. Such laws prohibit the employment of workers who are willing to work for less than a specified wage. The term "minimum wage" is apt to mislead the unwary, who naively assume that it represents a real sum of money that will automatically be exchanged between employer and employee if the legislation is enacted, thus benefitting the worker. Yet such a law does not require that an employer must actually pay the wage in question. It merely provides that an employer will not be permitted to employ anyone for a wage beneath the specified minimum. The distinction, as we shall see in a moment, should be of critical importance to those who are truly concerned about the incomes of workers at the lower end of the labor market.

Expressing the same idea in different language, we should note that minimum-wage legislation is of a purely negative nature: it does not guarantee a given wage to anyone, but merely prohibits certain transactions. For this reason it might be more realistically thought of as "elimination-of-wage" legislation.