Biden Expands Overtime Protections for 1 Million Workers

The brand new enhance was made ‘based mostly on the methodology utilized by the prior administration within the 2019 additional time rule replace.’

The Biden administration prolonged additional time protections on July 1 for a million employees making lower than $43,888 a yr, and President Joe Biden pledged to increase these protections in 2025 to a different 3 million employees, the White Home mentioned in an announcement.

“A tough day’s work ought to result in a good day’s pay,” President Biden mentioned within the Monday announcement.

Virtually all hourly employees in the US who exceed 40 hours of labor in every week are entitled to additional time pay a minimum of one and a half instances their regular charge, based on the Honest Labor Requirements Act (FLSA). Greater than 140 million employees are lined by this act.

Nevertheless, salaried workers engaged in administrative, government, or skilled guidelines are exempt if they’re incomes above a sure wage threshold.

The edge of $43,888, or $844 per week, is a rise from the earlier $35,568 annual wage threshold.

The extensions stem from a Honest Labor Requirements rule that was finalized in late April, with the subsequent extension set to enter impact on Jan. 1, 2025.

The Division of Labor additionally has safety for what it calls “extremely compensated workers,” making as much as $132,964 per yr, together with at the least $844 per week on a wage or charge foundation. The earlier threshold for these workers was $107,432 per yr and weekly fee of at the least $684 on a wage or charge foundation.

The Biden administration mentioned in an April 23 assertion that the brand new enhance was made “based mostly on the methodology utilized by the prior administration within the 2019 additional time rule replace.”

The additional time threshold is ready to extend to $58,656 in 2025. Starting on July 1, 2027, that threshold shall be up to date each three years by making use of “up-to-date wage knowledge.”

“For greater than 80 years, the 40-hour workweek has been a pillar of equity for American employees,” mentioned Performing Labor Secretary Julie Su mentioned in an announcement launched on July 1. “It’s the promise of going house to family members after placing in your time, not infinite hours for flat pay. Far too many are caught in jobs that disregard this precept.

“At the moment, our rule to revive that steadiness by increasing additional time protections for our nation’s lower-paid salaried employees goes into impact.”

The Labor Division factors out, nonetheless, that sure workers, corresponding to medical doctors, attorneys, and academics, aren’t topic to wage requirements and should fall throughout the exemption to the rule no matter how and the way a lot they’re paid. Employers are additionally allowed to make use of bonuses and incentive funds corresponding to commissions to account for as much as 10 p.c of an exemptable wage.