Labor and Employment

New overtime pay rules expected to affect millions of workers

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New U.S. Department of Labor overtime pay rules provided Wednesday are expected to add millions of workers to the ranks of those who must be paid time-and-a-half when their work week exceeds 40 hours.

Announced this week by the White House, the revised rules, which implement the Fair Labor Standards Act, will affect workers in three salary groups when they take effect on Dec. 1.

For the lowest-paid, a new annual salary ceiling of $47,476—roughly double the current $23,660 threshold—is the critical standard. Those within that salary limit automatically get overtime pay, according to ABC News and CNN Money. Employers may be able to avoid OT by increasing the employees’ annual pay (or reducing their work hours), especially for those workers who already earn nearly that much.

For employees making above $47,476, overtime pay may still be required, depending on how much autonomy they have at work and whether their employment falls into a category of workers—such as professionals with advanced degrees—who are exempt from overtime pay rules. A Wage and Hour Division web page provides details about professionals.

Finally, highly-compensated workers are in a third group that does not qualify for overtime, period. Currently, a $100,000 annual salary threshold determines who is within that category. However, under the new rules that limit will increase to $134,004.

Except for jobs specified by the DOL, there are no hard-and-fast rules about who is and is not exempt from overtime pay. Under Department of Labor guidelines, the answer to the question depends on the facts and circumstances of each employee’s work situation. Another Wage and Hour Division page lists “tests” that must be taken into account when determining whether employees in various job categories are exempt.

The New York Times (reg. req.), Politico, Slate, USA Today and the Wall Street Journal (sub. req.) also have stories.

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