Biden Administration Seeks to Expand Overtime Pay to Millions of U.S. Workers

[Celerity]

If you earn less than $55,000 a year and work more than 40 hours a week, you could be eligible for time and a half.

https://prospect.org/labor/2023-08-31-biden-administration-expand-overtime-pay/

Millions of U.S. workers may now become eligible for overtime pay under an overhaul of wage rules announced by the Biden administration yesterday. The rule, which would make workers earning up to $55,000 a year eligible for overtime, is intended to reverse four decades of reducing the number of workers qualified to earn overtime pay. As Capital & Main reported in a series of stories last year, overtime pay has steadily eroded, so that the percentage of workers eligible for overtime is now a fraction of what it was in the 1970s.

Currently, workers who earn more than $35,568 annually are not eligible for overtime. An estimated 15% of full-time salaried workers qualified for overtime in 2022, down from more than 60% of full-time salaried workers in 1975. The new eligibility rule could make 3.6 million more U.S. workers eligible for overtime pay, according to the administration. Overtime is defined by the Fair Labor Standards Act as 1.5 times one’s hourly pay rate after working more than 40 hours per week.

“For over 80 years, a cornerstone of workers’ rights in this country is the right to a 40-hour workweek, the promise that you get to go home after 40 hours or you get higher pay for each extra hour that you spend laboring away from your loved ones,” said Acting Secretary of Labor Julie Su. “I’ve heard from workers again and again about working long hours, for no extra pay, all while earning low salaries that don’t come anywhere close to compensating them for their sacrifices. Today, the Biden-Harris administration is proposing a rule that would help restore workers’ economic security by giving millions more salaried workers the right to overtime protections if they earn less than $55,000 a year.”

In 2014, the Obama administration sought to more than double the exemption threshold from $23,660 to $47,476, but the proposal was shot down by a federal judge in Texas. At that time, fewer than 7% of U.S. workers qualified for overtime. In 2019, the Trump administration increased the threshold to $35,568, which was still considered inadequate by worker advocates, and was not pegged to cost of living increases, meaning that it was frozen at that level.

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