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Trump administration proposes overtime rule, but is it enough?

On Behalf of | Mar 26, 2019 | Fair Labor Standards Act (FLSA), Firm News

In accordance with the federal Fair Labor Standards Act, salaried employees earning less than $23,600 per year are eligible for overtime. This means if you have a managerial position or are otherwise paid a salary, and if you make $455 per week or less, you should receive time-and-a-half for every hour over 40 that you work, under the FLSA. That’s under the current rules.

However, for many years, there have been efforts to increase that salary threshold to cover more employees and better align with inflation. Four years ago, the Obama administration attempted to double the threshold to more than $40,000 for salaried employees, but a federal judge invalidated the rule. Now, the Trump administration is proposing a new rule.

What is being proposed?

As discussed in articles like this one, the Department of Labor is proposing a scaled-back version of the rule proposed four years ago.

Instead of doubling the salary threshold, the new rule would increase it to just $35,000 per year. It also eliminates the cost-of-living increases that appeared in the Obama administration rule.

The proposal would affect 1.2 million workers who would now be eligible for overtime.

Proponents of the rule say that it is a step toward protecting workers and compensating them for working more than 40 hours. Critics of the proposal say it doesn’t go far enough to protect workers, calling the proposal “disgraceful.” And still other critics say the proposal would cost businesses too much to comply.

How does this affect workers?

At this point, there are no changes in effect to FLSA overtime laws. Before the DOL sends the proposed rule to The White House Office of Management and Budget for approval or denial, which can take up to two months, the public has 60 days to comment on it.

We will continue to follow any developments.

Important: New York City and New York State have their own employment laws that offer more protections than federal laws.

It is crucial to note that these changes affect federal overtime laws. The overtime laws — and salary thresholds — are different for workers in New York City and New York State. The thresholds are much higher for workers in New York. However, whether an employer complies with state or federal overtime laws depends on numerous factors.

As such, if you have questions about overtime pay, it would be wise to consult an attorney.