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Overtime Pay for Overtime Work

Brian Young's picture
Jul 07, 2015

President Obama added another one to his list of recent reforms: all workers making under a $50,440 yearly salary are now guaranteed overtime pay. The overtime pay expansion includes 5 million previously ineligible workers. 

Up until last week, the threshold was set at only $23,660, which is below the poverty line for a family of four. Businesses also took advantage of a loophole that allowed them to classify certain employees as managers or supervisors and deny them overtime pay as a result. In many cases, they would work well over 40 hours a week without their deserved pay increases.

The new guidelines increase the minimum threshold to $970/week, but they still do not address the managerial classification loophole. 

Despite its shortcomings, this reform brings us a step closer to rewarding a hard day's work with a fair day's pay.

Dan Hinton helped with research for this article.

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