President Barack Obama proposed to lift the threshold of overtime pay eligibility to include millions of Americans in full-time, salaried positions. Obama wrote about his plans to raise the minimum income level set by the Labor Department in the Huffington Post late Monday:
Obama to expand overtime pay for millions more workers
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We’ve got to keep making sure hard work is rewarded. Right now, too many Americans are working long days for less pay than they deserve. That’s partly because we’ve failed to update overtime regulations for years -- and an exemption meant for highly paid, white collar employees now leaves out workers making as little as $23,660 a year -- no matter how many hours they work.
This week, I’ll head to Wisconsin to discuss my plan to extend overtime protections to nearly 5 million workers in 2016, covering all salaried workers making up to about $50,400 next year. 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.
That’s how America should do business. In this country, a hard day’s work deserves a fair day’s pay. That’s at the heart of what it means to be middle class in America.
The president is making good on a long-standing promise, but not everyone is happy
Two Democratic presidential candidates -- Sen. Bernie Sanders (D-VT) and Maryland Gov. Martin O’Malley -- immediately voiced support, but the expansion also sparked concern from Republicans, as Fox News noted:
Yet many Republicans have opposed Obama’s plans to increase the threshold, arguing that doing so would discourage companies from creating jobs and dampen economic growth. Sen. Lamar Alexander of Tennessee, who chairs the Senate’s labor panel, has derided the idea as designed “to make it as unappealing as possible” for companies to create jobs.
The proposal shouldn’t be a surprise to politicians -- it’s been on the table for some time. Obama highlighted overtime pay during his most recent State of the Union. And here’s Obama speaking in March of last year, describing the initial proposal he sent to the Labor Department:
The proposal may come with new definition on positions
According to a Bloomberg report, the policy change could also come with a modification of the defenition of a “managerial” position:
Workers who earn as much as $970 a week would have to be paid overtime even if they’re classified as a manager or professional, based on draft rules to be announced as soon as Tuesday, said an administration official. ...
The regulations, from the Labor Department, would take effect in 2016, said the official, who asked for anonymity because the plan hasn’t been announced. Workers in retail stores and restaurants are among most likely to be affected. ...
The administration official didn’t disclose whether any changes will be proposed to the regulatory definition of a manager, though the Labor Department also is considering tightening that standard.
Further reading: what is the minimum wage?
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