Overtime Pay Gets Overhaul

NEW YORK (MainStreet) — Last March President Obama announced his intention to update the salary threshold for overtime pay, which the Department of Labor is expected to address this fall. On Wednesday, the left learning Economic Policy Institute came out with its recommendations on point.

Read More: Overtime, Over Budget? How Your Business Can Plan for Overtime Hours

Currently the U.S. salary threshold is set at $455 per week, meaning that an employer can exempt anyone earning more than that from time-and-a-half pay for working more than 40 hours per week. The threshold has only been adjusted once in the past 39 years, meaning that decades of inflation have taken their toll on its real value. While today it only applies to workers earning up to $23,660 per year, in 1975 it applied to anyone making up to $51,168 in inflation-adjusted dollars. This collapse has reportedly led to a quiet industry of flipping low paying jobs to salaried positions, then demanding 60- to 70-hour work weeks.

Read More: Should Overtime Laws Apply to All the Time Spent at Work or Just Some?

Back to Top