In 1975 about 65% of the salaried workers in the United States were paid overtime when they worked more than 40 hours in a workweek, a situation I've discussed before: So Why Did Overtime Disappear? Now only about 8% of salaried workers are paid overtime. Why is that, why did overtime disappear? The answer isn't that Americans are working less: a 2014 poll reported that salaried workers in America work on average 47 hours per week, 18% work more than 60.
The reason why overtime has nearly disappeared is that the salary threshold has remained so low, a testament to the power of corporate PAC money and lobbyists. The salary threshold at present is $23,660, which comes to $11.38 per hour for a 40 hour workweek. So, if a salaried worker is paid more than $23,660 a year and otherwise meets the criteria to be exempt from overtime, he or she is not paid overtime no matter how many hours they work.
New Overtime Rules for Salary Workers
This summer the Department of Labor will introduce new rules that will raise the salary threshold to $50,440 per year, which comes to $25.22 per hour for a 40 hour workweek. See Overtime Pay: A Lifeline for the Overworked American. Senate Republicans, for reasons not understandable, have introduced legislation to block this new standard, but it will likely go nowhere. The increase in the salary threshold falls well short of what it would need to be to make it equivalent to the 1970's standard (about $69,000 per year would be what it would take) but this is a long overdue and welcome step.
Remember: being paid a salary does not mean that you don't have to be paid overtime: Does being paid a salary mean that I don't have to be paid overtime?; Does a job title determine whether an employee is exempt from overtime pay requirements?
Lexington, Kentucky overtime lawyer Robert Abell helps individuals and employees recover the overtime and wages they've earned but not been paid; contact him at 859-254-7076.
