New Overtime Salary Floor Will Mean More Workers Can Earn Overtime Pay

Statement

President Obama announced this morning that the Department of Labor (DOL) intends to raise the salary threshold below which workers must receive overtime pay when they work more than 40 hours in a week. The current salary threshold is $23,660, and today's proposed rule would raise it to $50,440. Following this morning's announcement, Ranking Member Robert C. "Bobby" Scott expressed his strong support for the increase.

"Today's announcement that the Department of Labor plans to increase the number of workers eligible for overtime pay represents a real opportunity for this Administration to make a significant impact on the growing problem of income inequality in America.

"In the 30 years between 1973 and 2013, hourly compensation for the typical worker rose just over nine percent, while during that same time period productivity increased by 75 percent. One reason for the gap between the growth in productivity and wages is that many more workers today are working overtime, but are not being paid for it.

"Today, only eleven percent of the workforce is covered by overtime pay rules. Workers who earn more than $23,660 and perform certain managerial duties are exempt from overtime pay rules. That means many low-income salaried workers do not earn "time and a half' for hours worked over forty hours per week. In the 1970s, the overtime pay rules covered nearly two-thirds of the American workforce. To cover nearly two-thirds of the workforce today, the threshold would have to be set at $69,000. The President's proposed change to the threshold would increase the number of covered workers by nearly five million workers, and will be automatically updated going forward.

"The current salary level has set the overtime threshold too low for far too long. I look forward to reviewing the proposed rule and supporting a final rule that can put more money in the pockets of hardworking Americans."

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