Obama says proposal will make 5 million more eligible for OT

Under the current threshold only about 8% of salaried workers are eligible for 150% of their pay rate when they work overtime. Or they could offer lower starting salaries, figuring that would offset overtime to a certain extent. The Labor Department’s long-awaited proposal will raise the threshold to $970 a week – $50,440 a year – by 2016.

The increase in the salary threshold would expand the overtime requirement to 15 million additional workers, according to an estimate by Ross Eisenbrey, vice president of the Economic Policy Institute, a research group partly funded by labor unions.

Last Thursday, the Supreme Court upheld the Medicaid expansion rule in the Affordable Care Act which has allowed 6.4 million people to gain health insurance, with Congress, on the same day, sending a major piece of trade legislation, signed Monday, that would protect US workers from the upcoming worldwide trade deal. Her boss has an incentive to say she’s a manager, because it means he can make her work extra hours without having to pay for it. She frequently worked 60 hours a week but didn’t get overtime because she earned $36,000. She left two years later and has joined a class-action lawsuit against Chipotle, charging that apprentices shouldn’t be classified as managers exempt from overtime.

Yet the proposals won’t necessarily produce a big raise for people like Swa and Hughey. Some work gruelling schedules at fast food chains and retail stores, but with no overtime eligibility their pay may be lower per hour than many workers they supervise.

The National Retail Federation, which represents retailers in more than 45 countries, argues that the plan might motivate employers to rework supervisory structures and reduce the numbers of entry-level management jobs, according to Bloomberg. Yet supporters of extending overtime coverage say they would welcome those changes.

The administration’s proposal may make other changes.

“That’s good for workers who want fair pay, and it’s good for business owners who are already paying their employees what they deserve – since those who are doing right by their employees are undercut by competitors who aren’t”, Obama wrote in an op-ed in the Huffington Post.

It was not immediately clear if Mr Obama would also move to narrow an existing exemption from overtime pay protections for low-level white collar workers, as many observers had expected. California state regulations, by contrast, require more than half of an employee’s time be spent on management duties to be exempt from overtime pay. Obama maintains this is not only acceptable for employees, yet moreover for employers who are now paying employees what they deserve and are being undercut by those who don’t. “Or will we push for an economy where every American who works hard can contribute to and benefit from our success?”