Why Your Employer May Owe You More Money (If You Work More Than 40 Hours a Week)

I came across this thread on Reddit and wanted to make our readers aware of a new rule the White House and the Department of Labor has passed to help raise the wages of lower income to middle-class workers who are working more than 40 hours a week (and are not getting paid for it).

The Overtime Rule

First, a little background on this law / rule that is to take effect on December 1, 2016.

From the Department of Labor (DOL) website:

In 2014, President Obama directed the Secretary of Labor to update the overtime regulations to reflect the original intent of the Fair Labor Standards Act, and to simplify and modernize the rules so they’re easier for workers and businesses to understand and apply. The department has issued a final rule that will put more money in the pockets of middle class workers – or give them more free time.

Basically, this rule is being updated to help more Americans who are living on middle-class incomes and are working more than 40 hours per week. For some, this will be a boost to their pay as many are working well over a 40/hr week.

The DOL estimates it will be helping 4.2 million workers across the country.

overtime-map
A detailed breakdown of the 4.2 million workers who will be affected by the new Overtime Rule (DOL)

Whatever your politics may be in requiring employers to pay their employees more money – many will rejoice at this news.



Do you qualify?

So, how do you know if you’ll be one of the workers affected by the new overtime rules?

Here’s a simple breakdown:

  • Workers making less than $47,476 per year ($913/week). This is double the old rule of $23,660/year.
  • Workers need to be working more than 40 hours per week. Be sure to keep track of your overtime pay (if your employer doesn’t already).

To meet this new rule, employers will need to do one of the following for their employees (or a combination of them):

  • Pay time and a half for overtime work
  • Raise workers’ salaries above the new threshold
  • Limit workers hours to 40 hours per week

This rule and the salary threshold will also automatically “update” every 3 years – providing employers the ability to prepare for these increases (if needed) for their workers.

What are your thoughts?

What do you think? Is it a good idea the government is forcing employers to pay their workers for work they haven’t been getting paid for (or limit the amount of time they put in)? Will you be affected by the new rule change?

Here’s a video put out by the DOL on the Overtime Rule.





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