An estimated 3.6 million U.S. workers would become eligible for overtime pay when they work more than 40 hours a week, under a new proposal announced by the U.S. Department of Labor on August 30, 2023.
The long-awaited announcement has come after months of extensive DOL outreach to employers, workers, unions, and additional stakeholders. This outreach included 27 listening sessions where over 2,000 participants contributed their input to help shape the proposed rule.
Under the proposed rule, overtime pay would be guaranteed to most salaried workers earning less than $1,059 per week, about $55,000 per year. This proposed new threshold would mark a substantial increase from the current level of $35,587 per year, which was set by the Trump administration in 2019. According to the proposal, the threshold would also be updated every three years based on “current wage data”.
Salaried workers who earn above the salary threshold may still be eligible for overtime pay if they do not primarily perform management-related duties. Currently, those who earn a salary of more than $107,432 are generally automatically exempt. Wednesday’s proposal would increase the salary cut-off to $143,988.
According to the DOL, the proposed rule would achieve the following:
- Restore and broaden overtime protections to low-paid salaried workers.
- Provide valuable time back to workers who are not exempt executive, administrative, or professional employees.
- Prevent future erosion of overtime protection and ensure greater predictability.
- Provide overtime protections for U.S. territories, a practice that was previously in effect from 2004 to 2019.
Once the proposal is published in the Federal Register, the public will have 60 days to submit their comments. Please visit the DOL website for more info on the proposed rule and instructions for submitting comments.
