Today the Department of Labor has announced a proposed rule that would extend overtime protections to nearly 5 million white collar workers within the first year of its implementation. Failure to update the overtime regulations has left an exception to overtime eligibility originally meant for highly-compensated executive, administrative, and professional employees now applying to workers earning as little as $23,660 a year.
For example, a convenience store manager, fast food assistant manager, or some office workers may be expected to work 50 or 60 hours a week or more, making less than the poverty level for a family of four, and not receive a dime of overtime pay.
Today’s proposed regulation is a critical first step toward ensuring that hard-working Americans are compensated fairly and have a chance to get ahead.
Additional Information
- Notice of Proposed Rulemaking
- Overtime Resources
- Fact Sheet: Middle Class Economics Rewarding Hard Work by Restoring Overtime Pay
- A Hard Day's Work Deserves a Fair Day's Pay (Huffington Post)
- Frequently Asked Questions (PDF)
- Fact Sheet on Proposed Rule (PDF)
- Blog Post: 5 Million Reasons Why We’re Updating Overtime Protections
On March 13, 2014, President Obama signed a Presidential Memorandum directing the Department to update the regulations defining which white collar workers are protected by the FLSA's minimum wage and overtime standards. Consistent with the President's goal of ensuring workers are paid a fair day's pay for a fair day's work, the memorandum instructed the Department to look for ways to modernize and simplify the regulations while ensuring that the FLSA's intended overtime protections are fully implemented.
Following issuance of the memorandum, the Department embarked on an extensive outreach program, conducting listening sessions in Washington, DC, and several other locations, as well as by conference call. The listening sessions were attended by a wide range of stakeholders: employees, employers, business associations, non-profit organizations, employee advocates, unions, state and local government representatives, tribal representatives, and small businesses. In these sessions the Department asked stakeholders to address, among other issues: (1) What is the appropriate salary level for exemption; (2) what, if any, changes should be made to the duties tests; and (3) how the regulations could be simplified. The Department’s extensive outreach helped in shaping a proposed rule that is intended to be responsive to concerns raised by the regulated community.
The Notice of Proposed Rulemaking (NPRM) was published on July 6, 2015, in the Federal Register (80 FR 38515) and invited interested parties to submit written comments on the proposed rule atwww.regulations.gov by September 4, 2015. Only comments received during the comment period identified in the Federal Register published version of the NPRM will be considered part of the rulemaking record.
Written comments received during the comment period will be helpful in shaping any final rule. Based on past experience and extensive work with the regulated community on other FLSA-related matters, we believe a 60-day comment period provides sufficient time for interested parties to submit substantial comment. Equally important, a comment period of this length, coupled with the feedback already received during the initial outreach sessions, will meet the goal described above of ensuring the Department has the level of insight from the public needed to produce a quality regulation. For these reasons we will not be extending the comment period.
The Obama administration’s move to expand overtime eligibility has the potential to impact millions of workers. And women, who are disproportionately concentrated in low-wage jobs, make up the majority of those who may stand to gain.
A new analysis by the left-leaning Institute for Women’s Policy Research and Moms Rising found that 3.2 million women are newly covered by proposed changes to overtime rules, compared with 2.7 million men. But based on current work habits, men could take a greater share of the additional income, the study found.
The “newly covered” category is based on the proposal’s updated threshold under which most full-time salaried workers would be eligible to earn time-and-a-half pay for working more than 40 hours per week. The threshold would be increased to $970, or $50,440 annually. That level is about the 40thpercentile of weekly earnings for salaried workers. The Labor Department takes comments on proposed changes through early September. The current threshold is $23,660, or $455 a week. The institute’s analysis refers to all eligible workers, including ones who do not currently work overtime.(Source: WSJ)
