Labor Department Increases Overtime Salary Threshold
The change goes into effect Jan. 1, 2020
On Sept. 24, the Trump administration unveiled a final rule to extend overtime pay eligibility to an estimated 1.3 million workers, replacing a stalled Obama-era initiative that would have covered four times as many employees.
The department’s new rule lifts the annual salary threshold below which workers qualify for overtime wages to $35,568 from the current level of roughly $23,600. The regulation would require employers starting Jan. 1 to pay time-and-a-half rates to workers making less than the threshold amount for all hours beyond 40 per week.
The move is expected to draw a legal challenge from worker advocates who have urged the department to try to salvage an Obama administration regulation, which was blocked by a federal judge in Texas in 2016. That rule would have doubled the salary threshold to $47,500 and automatically updated it every three years to keep pace with cost-of-living increases. The new rule doesn’t include automatic updates, which the business community has railed against since the administration signaled that it would revisit overtime pay requirements.
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