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Proposed Rule Would Increase and Expand Overtime Eligibility

S.J. Steinhardt
Published Date:
Aug 31, 2023

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Millions more U.S. workers could become eligible for overtime pay under a new rule proposed by the U.S. Department of Labor.

The proposed rule would guarantee overtime pay for most salaried workers earning less than $1,059 per week, about $55,000 per year, and could apply to as many as 3.6 million workers.

Under current laws, hourly workers are automatically due time-and-a-half pay when they work more than 40 hours a week. Salaried workers can only receive the same overtime pay if they earn less than $35,358 per year.

“We are committed to ensuring that all workers are paid fairly for their hard work,” Principal Deputy Wage and Hour Division Administrator Jessica Looman said in the announcement. “For too long, many low-paid salaried workers have been denied overtime pay, even though they often work long hours and perform much of the same work as their hourly counterparts. This proposed rule would ensure that more workers receive extra pay when they work long hours.”

The proposed rule would: restore and extend overtime protections to low-paid salaried workers; give workers who are not exempt executive, administrative or professional employees valuable time back; prevent a future erosion of overtime protections and ensure greater predictability; and restore overtime protections for U.S. territories.

The rule is likely to encounter opposition and legal challenges, The Washington Post reported. The Associated Builders and Contractors, a construction industry trade group, told The Post that it was “disappointed” that the Labor Department is pursuing the rule as businesses continue to grapple with labor shortages and inflationary pressures.

The National Association of Manufacturers also objected, concerned that increasing the threshold for overtime exemptions would cause hardship for employers, The Post reported, and is considering taking legal action.

Some 300,000 more manufacturing workers would be eligible for overtime pay under the new rule, according to the Labor Department.

The proposed rule will be subject to a 60-day comment period once it is published in the Federal Register.

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