Biden proposal provides overtime for millions of workers: Who would benefit?
Through a new proposal from President Joe Biden, millions of workers could receive overtime compensation if they work a minimum number of hours per week.
The United States Department of Labor (DOL) has launched a new proposal where nearly three million workers would have the right to receive overtime pay when they work more than 40 hours a week.
Through the measure, the Biden Administration intends to extend the protection of time-and-a-half pay to a greater number of workers through the modification of the exemptions of the Reasonable Labor Standards Act.
“We are committed to ensuring that all workers receive fair remuneration for their hard work. This rule will ensure that more workers receive extra pay when they work long hours,” says the Senior Deputy Director of the Wage Division and DOL Hours, Jessica Looman.
What does the proposal say?
According to this new proposal, companies would pay workers one and a half times their hourly wage if they work more than 40 hours a week. Salaried executives or managers who earn above the established threshold will not be covered by this new law.
If approved, the salary component would rise to $55,000 per year. In other words, people who register these earnings and who work more than the hour limit will be able to automatically collect overtime.
The current level is $35,568, with the last update recorded four years ago, when the threshold was $23,660 dollars. Once the project is approved, the threshold will increase every three years.
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When will the new law take effect?
Currently, the project stands as a proposal, which must be published in the country’s Federal Registry. When this happens, there will be a period of 60 days to present public comments or suggestions with some changes, so the law would not come into force for a few months.
If passed, this potential new legislation would have the greatest impact in the hospitality, manufacturing, food and retail sectors, which is where employees typically fall within the new income threshold.