Great News on Overtime Rules
Great news! The Department of Labor today announced major changes to federal overtime regulations that will benefit millions of low- and middle-income workers.
Currently, salaried workers who earn as little as $455 a week or $23,660 a year can be excluded from receiving overtime pay when working more than 40 hours a week if they spend even a small amount of time on duties classified by their employers as professional, administrative, or executive. This threshold is below the poverty line for a family of four.
By raising the eligibility threshold to $913 a week or $47,476 a year, the new rule will cover 4.2 million more workers who will either gain new overtime protections, get a raise to the new salary threshold, or have more free time. And 1.5 million of these workers are parents of children under 18, which translates into 2.5 million children seeing at least one parent gain from these changes. When you include workers who have their rights to overtime pay strengthened, you’re looking at 12.5 million workers directly benefiting from this move.
By automatically updating the salary threshold every three years, the new rule will protect workers in the future as well, and will ensure we don’t end up in the same place we are today years down the road. In 1975, more than 60 percent of salaried workers were guaranteed overtime rights. Today, only about 7 percent are.
By providing greater clarity for workers and employers over who is covered, workers will be better able to stand up for their rights and ensure they’re getting the fair compensation they deserve.
By putting more money in workers’ pockets, the new rules will be better for the economy. And because some employees will choose to hire new workers or give more hours to part-time workers rather than pay overtime, new openings may be created.
All in all, the updated regulations, which will take effect on December 1 of this year, will mean millions of Americans who have been working longer hours without getting paid for them will finally get compensated for their hard work.
CHN salutes the advocates and our affiliates who have been fighting for these changes for years, and we thank all of you who have read our previous blog posts about this and have taken action. Your voice was heard! Of course, we applaud the Department of Labor and the Obama Administration for taking action to help millions of American workers.
For more on how the new overtime rule works, watch the video below from the Department of Labor and check out these great resources from the Economic Policy Institute and the National Employment Law Center. Then use this tool from the National Women’s Law Center to say “Thank You” to Labor Secretary Tom Perez.