4.3 million more workers will soon get OT pay. Here's who qualifies.

About 4.3 cardinal U.S. workers who antecedently didn't suffice for overtime salary could soon person time-and-a-half for moving much than 40 hours a week acknowledgment to a caller norm from nan Biden administration.

The U.S. Department of Labor connected Tuesday unveiled a caller rule that will widen overtime salary to salaried workers who gain little than $1,128 per week, aliases $58,656 annually. Previously, only workers who made $684 aliases little each week, aliases $35,568 annually, were eligible for OT.

Businesses are required to salary workers 1.5 times their salary if they activity much than 40 hours a week, but that protection has been constricted to hourly workers and lower-earning salaried employees. Because of nan net cutoff, galore salaried workers were performing nan aforesaid duties arsenic their hourly coworkers, but weren't capable to suffice for overtime, Acting Labor Secretary Julie Su said successful a statement.

"This norm will reconstruct nan committedness to workers that if you activity much than 40 hours successful a week, you should beryllium paid much for that time," she said. 

The caller norm could consequence successful an further $1.5 cardinal successful salary for employees, according to an estimate from nan Economic Policy Institute, a left-leaning deliberation tank.  

"Employers will beryllium much than capable to set to nan norm without negatively impacting nan wide economy," wrote EPI head of authorities affairs and defense Samantha Sanders and President Heidi Shierholz.

Here's what to cognize astir nan caller OT rule. 

Why is overtime salary getting overhauled?

The Fair Labor Standards Act requires that astir workers who walk much than 40 hours a week connected nan occupation person 1.5 times their regular salary for each hr they activity beyond that amount. 

While nan rule covers astir each hourly workers, salaried labor only suffice for OT if they gain beneath a circumstantial salary. Currently, that period is $684 per week, aliases $35,568 annually.

That intends a salaried worker earning little than that cutoff "can beryllium forced to activity 60-70 hours a week for nary much salary than if they worked 40 hours," Sanders and Shierholz wrote. "The other 20-30 hours are wholly free to nan employer, allowing employers to utilization workers pinch nary consequences."

Who is covered by nan caller overtime rule?

The rule covers salaried workers who gain beneath definite thresholds, and it will footwear successful done 2 phases.

Starting July 1, salaried workers who gain little than $844 per week, aliases $43,888 per year, will beryllium covered by nan caller rule. On January 1, 2025, nan net period will jump to $1,128 per week, aliases $58,656 per year, nan Labor Department said.

Most of nan further workers who will now suffice for OT are successful master and business services, wellness care, and societal services arsenic good arsenic financial activities, EPI said. About 2.4 cardinal of nan 4.3 cardinal workers are women, while 1 cardinal of color, it said.

Who won't suffice for OT?

First, overtime salary isn't disposable to salaried workers who are considered "executive, administrative aliases professional" employees.

Some researchers person pointed retired that corporations give fake titles to low-ranking workers for illustration "grooming manager" for a barber successful bid to make them look for illustration managers. 

The caller norm stipulates that only "bona fide" executive, administrative aliases master labor are exempt from nan expanded OT rule. 

What are businesses saying astir nan caller rule?

Some manufacture groups are pushing backmost against nan overtime rule, saying that it will harm their operations and lead to occupation cuts. Some are besides threatening ineligible action. 

"We fearfulness galore hoteliers will person nary action different than to destruct managerial jobs that are long-established paths to advancement," American Hotel & Lodging Association (AHLA) interim President Kevin Carey successful a statement. "AHLA is reviewing each disposable options, including litigation, for defeating this ill-advised regulation."

In:
• United States Department of Labor