the White House has proposed new overtime rules that could increase your paycheck
Big news: the White House has approved a proposal from the Department of Labor to change the rules that govern who must receive overtime pay.
If it becomes law, your employer would be required to pay you overtime (time and a half for all hours over 40 that you work in a week) unless you earn at least $55,068 annually – a big increase (54%!) from the current threshold of $35,568. That means employers would have to either track and limit the number of hours a large pool of people can work or start paying them overtime … or raise their salaries to the new threshold.
In addition, the proposal includes automatic updates to this salary threshold every three years based on wage data.
However, the change is not a sure thing. It needs to be placed in the Federal Register for public comment (and until it’s published there later this month, we won’t know if $55,068 will be the final number; they might tweak it based on more current wage data, which presumably could send it slightly higher). There will also be court challenges (as there have been in the past whenever there’s a proposal to raise the exemption threshold). In fact, in 2016, the federal government announced it was raising the minimum salary for overtime exemption, and a judge blocked it the day before it was scheduled to take effect … and it stayed on hold until 2020, when it finally went into effect but at a lower salary level. So at this point there’s no knowing whether it will happen or how the presidential election later this year could affect things. But if it does survive, it’s expected to take effect at the beginning of next year.
