More Work, More Pay? New Rule Extends Overtime to Millions

COLUMBUS, Ohio (AP) – More than 4 million U.S. workers will become newly eligible for overtime pay under rules issued Wednesday by the Obama administration.

The policy changes are intended to counter an erosion in overtime protections, which date from the 1930s and require employers to pay 1 ½ times a worker’s regular salary for any work past 40 hours a week.

Vice President Joe Biden announced the changes at Jeni’s Splendid Ice Creams in Columbus, Ohio.

In the fast food and retail industries, in particular, many employees are deemed “managers,” work long hours, but are barely paid more than the people they supervise.

Under the new rules, first released in draft form last summer, the annual salary threshold at which companies can deny overtime pay will be doubled from $23,660 to nearly $47,500.

The updates will impact 4.2 million Americans and close 56-percent of those workers are women, which translates into 2.4 million women either gaining overtime protections or getting a raise to the new threshold as a result of the rule.

To break it down by your weekly payments, the rule increases the salary threshold to salaried workers entitled to overtime from the current $455 per week (or $23,660 for a full-year worker) to $913 per week (or $47,476 for a full-year worker).

Courtesy: U.S. Department of Labor
Courtesy: U.S. Department of Labor

According to data released by the U.S. Department of Labor, the changes will affect 60,000 workers in the state of Alabama.

The final rule will become effective on December 1, 2016, giving employers more than six months to prepare. (Courtesy: U.S. Department of Labor)
The final rule will become effective on December 1, 2016, giving employers more than six months to prepare. (Courtesy: U.S. Department of Labor)

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s