In his weekly address released today, President Barack Obama explained a new federal regulation finalized this week by the Department of Labor that will required employers to pay overtime to salaried workers who make less than $47,500 per year. The federal-regulation-mandated overtime will kick in once the salaried worker has worked more than 40 hours in a week.
“It’s a move that will boost wages for working Americans by $12 billion over the next 10 years,” Obama argued.
“We’re more than doubling the overtime salary threshold,” he said. “And what that means is, most salaried workers who earn less than about $47,500 a year will qualify for overtime. Or, their employers can choose to give them a raise so that they earn more than $47,500. Or, if employers don’t want to raise wages, they can let them go home after 40 hours and see their families or train for new jobs.”
Hi everybody. Last summer, I got a letter from a woman named Elizabeth Paredes from Tucson, Arizona. Elizabeth is the mom of a 3-year-old boy, and an assistant manager at a sandwich shop. She earns about $2,000 a month, and she routinely works some 50 hours a week, sometimes even more. But because of outdated overtime regulations, she doesn’t have to be paid a dime of overtime.
She wrote: “It’s not easy work and requires a lot of time away from my son… at times I find [it’s] not worth it.”
Things like the 40-hour workweek and overtime are two of the most basic pillars of a middle class life. But for all the changes we’ve seen in our economy, our overtime rules have only been updated once since the 1970s. Just once. In fact, forty years ago, more than 60 percent of workers were eligible for overtime based on their salaries. But today, that number is down to seven percent. Only seven percent of full-time salaried workers are eligible for overtime based on their income.
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