DOL Releases Proposed Changes to Overtime Pay Rule

It was months in the making, but the U.S. Department of Labor (DOL) has issued the proposed overtime rule that employers have long been anticipating.

On Aug. 30, DOL announced a notice of proposed rulemaking that would restore and extend overtime protections to 3.6 million salaried workers, guaranteeing overtime pay for most salaried workers earning less than $1,059 per week (or about $55,000 per year), according to DOL.

“For over 80 years, a cornerstone of workers’ rights in this country is the right to a 40-hour workweek, the promise that you get to go home after 40 hours or you get higher pay for each extra hour that you spend laboring away from your loved ones,” said Acting Secretary of Labor Julie Su, in a statement announcing the proposed changes.

The announcement follows “months of extensive outreach” to employers, workers, unions and other stakeholders, according to DOL, which says it held 27 listening sessions with more than 2,000 participants to inform the proposed rule.

“I’ve heard from workers again and again about working long hours for no extra pay, all while earning low salaries that don’t come anywhere close to compensating them for their sacrifices,” Su continued. “Today, the Biden-Harris administration is proposing a rule that would help restore workers’ economic security by giving millions more salaried workers the right to overtime protections if they earn less than $55,000 a year. Workers deserve to continue to share in the economic prosperity of Bidenomics.”

Ensuring Overtime Protections

According to DOL, the proposed rule would accomplish a number of objectives.

For example, the rule would restore and extend overtime protections to low-paid salaried employees working side-by-side with hourly employees, performing the same tasks and frequently working more than 40 hours a week.

“But, because of outdated and out-of-sync rules, these low-paid salaried workers aren’t getting paid time-and-a-half for hours worked over 40 in a week,” according to DOL, which says that the department’s proposed salary level would help ensure more of these workers receive overtime protections.

The changes would also give “valuable time back” to workers who are not exempt executive, administrative or professional employees, according to DOL.

“By better identifying which employees are executive, administrative or professional employees who should be overtime exempt, the proposed rule will better ensure that those who are not exempt will gain more time with their families or receive additional compensation when working more than 40 hours a week.”

And, in addition to restoring overtime protections for U.S. territories, the proposed rule would also automatically update the salary threshold every three years to reflect current earnings data, which DOL says will “prevent a future erosion of overtime protections and ensure greater predictability.”

Upon publication in the Federal Register, the notice of proposed rulemaking will be open for public comment for 60 days, according to DOL, which will consider all comments received before publishing a final rule.

Principal Deputy Wage and Hour Division Administrator Jessica Looman urged stakeholders to weigh in during the public comment period.

“We are committed to ensuring that all workers are paid fairly for their hard work,” said Looman, in a statement. “For too long, many low-paid salaried workers have been denied overtime pay, even though they often work long hours and perform much of the same work as their hourly counterparts. This proposed rule would ensure that more workers receive extra pay when they work long hours. Public input is essential as we consider the needs of today’s workforce and industry demands, and we encourage continued stakeholder input during the public comment period.”