UNITED STATES NEWS

Millions more workers would be entitled to overtime pay under a proposed Biden administration rule

Aug 29, 2023, 5:50 PM | Updated: Aug 30, 2023, 3:30 am

NEW YORK (AP) — The Biden administration will propose a new rule Tuesday that would make 3.6 million more U.S. workers eligible for overtime pay, reviving an Obama-era policy effort that was ultimately scuttled in court.

The new rule, shared with The Associated Press ahead of the announcement, would require employers to pay overtime to so-called white collar workers who make less than $55,000 a year. That’s up from the current threshold of $35,568 which has been in place since 2019 when Trump administration raised it from $23,660. In another significant change, the rule proposes automatic increases to the salary level each year.

Labor advocates and liberal lawmakers have long pushed a strong expansion of overtime protections, which have sharply eroded over the past decades due to wage stagnation and inflation. The new rule, which is subject to a publicly commentary period and wouldn’t take effect for months, would have the biggest impact on retail, food, hospitality, manufacturing and other industries where many managerial employees meet the new threshold.

“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,” Acting Secretary of Labor Julie Su said in a statement.

The new rule could face pushback from business groups that mounted a successful legal challenge against similar regulation that Biden announced as vice president during the Obama administration, when he sought to raise the threshold to more than $47,000. But it also falls short of the demands by some liberal lawmakers and unions for an even higher salary threshold than the proposed $55,000.

Under the Fair Labor Standards Act, almost all U.S. hourly workers are entitled to overtime pay after 40 hours a week, at no less than time-and-half their regular rates. But salaried workers who perform executive, administrative or professional roles are exempt from that requirement unless they earn below a certain level.

The left-leaning Economic Policy Institute has estimated that about 15% of full-time salaried workers are entitled to overtime pay under the Trump-era policy. That’s compared to more than 60% in the 1970s. Under the new rule, 27% of salaried workers would be entitled to overtime pay because they make less than the threshold, according to the Labor Department.

Business leaders argue that setting the salary requirement too high will exacerbate staffing challenges for small businesses, and could force many companies to convert salaried workers to hourly ones to track working time. Business who challenged the Obama-era rule had praised the Trump administration policy as balanced, while progressive groups said it left behind millions of workers.

A group of Democratic lawmakers had urged the Labor Department to raise the salary threshold to $82,732 by 2026, in line with the 55th percentile of earnings of full-time salaried workers.

A senior Labor Department official said new rule would bring threshold in line with the 35th percentile of earnings by full-time salaried workers. That’s above the 20th percentile in the current rule but less than the 40th percentile in the scuttled Obama-era policy.

The National Association of Manufacturers last year warned last year that it may challenge any expansion of overtime coverage, saying such changes would be disruptive at time of lingering supply chain and labor supply difficulties.

Under the new rule, some 300,000 more manufacturing workers would be entitled to overtime pay, according to the Labor Department. A similar number of retail workers would be eligible, along with 180,000 hospitality and leisure workers, and 600,000 in the health care and social services sector.

United States News

Associated Press

The Latest | Israeli strikes in Rafah kill at least 5 as ship comes under attack in the Gulf of Aden

Palestinian hospital officials said Israeli airstrikes on the southern city of Rafah in the Gaza Strip killed at least five people. More than half of the territory’s population of 2.3 million have sought refuge in Rafah, where Israel has conducted near-daily raids as it prepares for an offensive in the city. In central Gaza, four […]

5 hours ago

Associated Press

Colleges nationwide turn to police to quell pro-Palestine protests as commencement ceremonies near

AUSTIN, Texas (AP) — With graduations looming, student protesters doubled down early Thursday on their discontent of the Israel-Hamas war on campuses across the country as universities, including ones in California and Texas, have become quick to call in the police to end the demonstrations and make arrests. While grappling with growing protests from coast […]

5 hours ago

Anti-Abortion activists rally outside the Supreme Court, Wednesday, April 24, 2024, in Washington. ...

Associated Press

Supreme Court justices unconvinced state abortion bans conflict with federal health care law

Conservative Supreme Court justices are skeptical that state abortion bans enacted after the overturning of Roe v. Wade violate federal law.

10 hours ago

Lisa Pisano looks at photos of her dog after her surgeries at NYU Langone Health in New York on Mon...

Associated Press

New Jersey woman becomes second patient to receive kidney from gene-edited pig

A New Jersey woman who was near death received a transplanted pig kidney that stabilized her failing heart.

11 hours ago

Associated Press

Instagram fraudster ‘Jay Mazini’ has been sentenced for his crypto scheme that preyed on Muslims

NEW YORK (AP) — The former Instagram influencer known as “ swindled millions of dollars from online followers and a network of Muslims during the pandemic was sentenced to seven years in prison on Wednesday, prosecutors said. Jebara Igbara, 28, of New Jersey, had pleaded guilty to fraud charges, admitting that he created a Ponzi […]

11 hours ago

Associated Press

Connecticut Senate passes wide-ranging bill to regulate AI. But its fate remains uncertain

HARTFORD (AP) — The Connecticut Senate pressed ahead Wednesday with one of the first major legislative proposals in the U.S. to reign in bias in artificial intelligence decision-making and protect people from harm, including manufactured videos or deepfakes. The vote was held despite concerns the bill might stifle innovation, become a burden for small businesses […]

11 hours ago

Sponsored Articles

...

COLLINS COMFORT MASTERS

Here are 5 things Arizona residents need to know about their HVAC system

It's warming back up in the Valley, which means it's time to think about your air conditioning system's preparedness for summer.

...

Collins Comfort Masters

Here’s 1 way to ensure your family is drinking safe water

Water is maybe one of the most important resources in our lives, and especially if you have kids, you want them to have access to safe water.

...

Day & Night Air Conditioning, Heating and Plumbing

Day & Night is looking for the oldest AC in the Valley

Does your air conditioner make weird noises or a burning smell when it starts? If so, you may be due for an AC unit replacement.

Millions more workers would be entitled to overtime pay under a proposed Biden administration rule