Trump Administration Fails To protect Worker's Overtime Pay

(This image is from NAHBNow.com.)

The following is part of an excellent article at the Economic Policy Institute on Overtime pay:

Nationally, millions of low- and moderately-paid working people are working overtime but not getting paid for it. Federal law guarantees certain workers overtime pay, meaning when they work more than 40 hours in a week they get 1.5 times their regular pay for the extra hours. This guarantee applies automatically to salaried workers making below a specified income threshold, because detailed studies of job duties show that most lower-paid salaried workers do not perform sufficient executive, “administrative,” or professional duties required by federal law to be exempt from overtime. But as the federal government has failed to update this income threshold over the last few decades, it had been allowed to erode dramatically with inflation.

As a result, the percentage of full-time salaried workers who are automatically eligible for overtime based on their pay dropped from more than 60 percent in 1975 to less than 7 percent in 2016. Recognizing the problem this caused, the Obama administration undertook a lengthy regulatory process to increase the threshold to $47,476 annually and to automatically increase it every three years thereafter. If this rule had not been blocked, the new income threshold would have resulted in 33 percent of full-time salaried workers being automatically eligible for overtime based on their pay.

The Obama administration’s overtime regulations would have provided new or strengthened protections to 12.5 million more U.S. workers. While the Trump administration appealed the Texas court decision to protect its authority to set an overtime standard, it failed to fight for the $47,476 salary threshold that was established through careful economic analysis in the 2016 rule. Under federal law, therefore, it remains legal for companies to force many low-paid salaried employees to work many hours above a 40 hour workweek—for free. . . .

In the absence of effective federal action on behalf of working people, state leaders are the best hope for presenting a vision and a road map for improving the economic prospects of all Americans.