Good Government: New Overtime Pay Rules Going Into Effect in December

Good government brought to you by the Democratic administration of President Barack Obama and his Labor Secretary, Tom Perez.

Today, the administration will announce new overtime pay rules that will insure that millions of middle-income Americans get paid for the hours they work.

It is pretty simple, as explained by this short video:

Every week, millions of Americans work more than 40 hours a week but do not receive the overtime pay they have earned. Today, the Department of Labor will be finalizing a rule to fix that by updating overtime protections for workers.

In total, the new rule is expected to extend overtime protections to 4.2 million more Americans who are not currently eligible under federal law, and it is expected to boost wages for workers by $12 billion over the next 10 years.

FACT SHEET: Growing Middle Class Paychecks and Helping Working Families Get Ahead By Expanding Overtime Pay

“We’re making more workers eligible for the overtime that you’ve earned. And it’s one of the single most important steps we can take to help grow middle-class wages.”
– President Barack Obama, La Crosse, WI, July 2, 2015

From the Moose Archives: Good Government: Updating Fair Labor Standards
(La Crosse WI – July 2, 2015 – Speech and Transcript)

This afternoon, Vice President Joe Biden will travel to Columbus Ohio to speak about the new rules. The live stream will begin at 2:30pm Eastern:

Email from Joe Biden:

My dad had something he used to say to me:

“A job is about a lot more than a paycheck. It’s about dignity and respect.”

Part of what he meant by that, I think, is that without the ability to provide for your family, you’re deprived of your dignity.

That’s the fundamental spirit behind a big change our Administration made today to modernize our overtime rules: Making sure hard work is rewarded with fair pay.

The change we’re making today is straightforward:

Right now, you’re guaranteed overtime if you’re an hourly worker, but if you’re salaried, you’re only automatically guaranteed overtime if you make less than $23,660. If you’re a manager on salary and you work an extra 10, 20, 30 hours a week — you often don’t get paid a dime more for those additional hours. That’s simply wrong.

Starting in December, we’re making sure that more workers get paid fairly for the overtime hours that they work. With this new rule, we’re increasing the cutoff for automatic overtime for salaried workers to $47,476 — most salaried workers making less than $47,476 will be guaranteed overtime pay for working more than 40 hours a week.

Companies will have a choice: Pay their workers for the extra hours they put in, or cap their hours at 40 hours a week. For over 4 million workers, this change means they’ll either get a bump in pay or will get more time with their families if they work more than 40 hours a week. Or more time to go back to school or get additional job training.

Today, I’ll head to Columbus, Ohio to visit a business, an ice cream company called Jeni’s, with 600 employees around the country. They’ve got a management that understands what “fair” means. They’ve already begun making changes to guarantee overtime to some of their managers.

You can learn more and listen in right here.

The law since the 1930s has said that anyone working more than 40 hours a week is working overtime. And if you’re working overtime, you should get paid for it. We can’t allow folks with families to support to work long hours without being paid fairly for it.

It’s not right. So today, we’re doing what we can to fix it.

The President and I have been laser-focused on rebuilding the basic middle-class bargain that used to exist, and that both parties have signed on to. What it comes down to is that if you contribute to the success of the company that employs you, you should get paid fairly for it. Because of the Administration’s efforts to rebuild that basic bargain, the economy has gone from crisis to recovery to resurgence. Wages are on track to rise this year by over 3 percent. Today’s expansion of overtime protections will build on this momentum.

That’s how you increase access to the middle class. But we know we have more work to do and we’re going to keep going right through the finish line.

You can tune in to the event in Ohio right here.

See you out there.

-Joe

  4 comments for “Good Government: New Overtime Pay Rules Going Into Effect in December

  1. JanF
    May 18, 2016 at 1:53 pm

    Every time you see a good government initiative, ask yourself this: What Would Donald Trump Do (WWDTD)?

    The answer is Never This.

    The Fair Labor Standards Act has been protecting American workers since 1938, a part of the Good Government initiatives signed into law by Democratic President Franklin D. Roosevelt.

  2. JanF
    May 19, 2016 at 8:53 am

    From Hillary Clinton’s campaign:

    Hillary Clinton Statement on New Department of Labor Overtime Rules

    Today, in response to final overtime rules released by the Department of Labor guaranteeing overtime to workers who earn up to $913 a week or $47,476 over a year—more than double the previous threshold of $455 a week—Hillary Clinton issued the following statement:

    “I applaud President Obama and Secretary of Labor Perez for these final overtime rules, which will lift up workers nationwide and help get incomes rising again for working families. Within the first year these rules are in effect, millions more workers will be eligible for overtime, finally getting paid in full for the hours they are putting in on the job.

    “But we have more work to do. No one who works 40 hours a week should have to raise a family in poverty. No one should have their fundamental rights to organize and bargain collectively stripped away by Republicans and their corporate allies. That’s why we need to raise the federal minimum wage back to the highest it’s ever been in this country and make sure it keeps rising over time, protect workers’ rights and safety on the job, and restore the basic bargain that built America’s mighty middle class—that if you work hard and play by the rules, you can get ahead and stay ahead.”

  3. Denise Velez
    May 19, 2016 at 8:59 am

    Amazing that in this day and age workers still have to fight for something like overtime pay.

    • JanF
      May 19, 2016 at 9:07 am

      Another example of rules that aren’t properly indexed to inflation. In 1975, it probably seemed like $23,660 was a princely wage and clearly made you part of “senior management”. Now, it is not enough to live on and the limit is being used in many cases to steal wages from workers.

      The Republican reaction was, as expected, all about “job killing executive overreach”. But this from House Majority Leader Kevin McCarthy made me laugh out loud:

      “The rule will force employers to waste time and resources logging hours,”

      Oh, the humanity!!! Forced to “log hours” when their employees work!!! Unheard of in the annals of payroll accounting.

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