As long as the base pay adds up to minimum wage, they are allowed to pay in any structure they wish. If they are being reimbursed for mileage at .40.mi, they should speak to a tax specialist to see if they are allowed to claim the difference between the .40/mi and the IRS allowed .51/mi on their taxes. Companies are not required to reimburse their employees for mileage as the employee can claim it on taxes. Further, it is not at all out of the ordinary for national companies to pay different wages in different areas.