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PopWrapped | Current Events

President Obama Boosts Overtime Pay For Millions

Roxanne Powell | PopWrapped Author

Roxanne Powell

Updated 05/21/2016 12:28pm
President Obama Boosts Overtime Pay For Millions | Obama
Media Courtesy of fingercheck.com

Just like the everyman, President Obama has been concerned with the amount of money people are receiving in their paychecks. An across-the-board raise in minimum wage has been shut down by the Republican Congress, and many are starting to worry.

Luckily, the President is looking out for us. Instead of working against the current of minimum wage, the White House has set its sights on changing the policies of overtime pay.

https://youtu.be/UFJaDm720FU

According to the Department of Labor, President Obama approached the Secretary of Labor about this back in 2014, and asked him to update the policies and regulations surrounding overtime pay. These changes, he argued, would better reflect the intentions of the Fair Labor Standards Act.

Updating these Standards and rules will also make it easier for workers and business owners to understand and apply them.

The President addressed this change in his State of the Union address last year, saying, “We still need to make sure employees get the overtime they’ve earned.” He then proposed a change in income thresholds to change overtime eligibility.

President Obama oal.gov

The Labor Department finalized the new overtime rules yesterday (May 17, 2016) in what the Huffington Post is calling “one of the most ambitious economic reforms of the Obama era.”

The administration will accomplish that by raising what’s known as the overtime salary threshold. Nearly all workers earning salaries beneath that threshold are entitled to time-and-a-half pay whenever they work more than 40 hours in a week.

The current threshold is just $23,660. The White House will be doubling that number, to $47,476, guaranteeing overtime rights for salaried workers earning less than that. The Labor Department will now update the threshold every three years to make sure it keeps pace with inflation.

The White House estimates that the change will bring overtime rights to 4.2 million workers who are currently excluded. It will also clarify eligibility for another 8.9 million workers who may or may not have overtime protections under the current rules, officials said.

This final rule will put "more money in the pockets of middle class workers – or give them more free time." This means workers can either stay and work more hours for more money or, if their workload is distributed to other people, they can clock out on time and go do something else.

 

According to the Department of Labor, the final rule will:

  • Raise the salary threshold indicating eligibility from $455/week to $913($47,476 per year), ensuring protections to 4.2 million workers.

  • Automatically update the salary threshold every three years, based on wage growth over time, increasing predictability.

  • Strengthen overtime protections for salaried workers already entitled to overtime.

  • Provide greater clarity for workers and employers.

However, employers have some wiggle room, too. They can either pay their workers time and a half, raise their salaries, and/or limit their employees to a 40 hour work week.

President Obama dol.gov

And the nice part? The Republicans cannot do anything about the ruling. Under the Fair Labor Standards Act, the White House has the authority to make changes like this one without the approval of Congress.

The final rule will come into effect on December 1, 2016.

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