Trump Proposal Would Keep Millions of Working People from Getting Overtime
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09 Mar Trump Proposal Would Keep Millions of Working People from Getting Overtime

Posted at 09:51h in Overtime by

A four-year fight to expand overtime pay to millions of workers may soon be over and about 1.2 million workers will win while 2.8 million will lose.

The Department of Labor is scaling back an Obama-era rule that would have doubled the minimum salary for a worker to qualify for overtime pay, according to a proposed rule the agency sent to the Office of the Federal Register for public review.

With few exceptions, only workers who earn less than $23,000 a year can currently earn overtime pay under federal law. Overtime wages are defined as 50 percent extra hourly pay for employees who work more than 40 hours in a week.

In 2014, the Obama administration tried to double the threshold to include workers earning up to $47,000, tying future changes to the cost of living. The idea was that a dramatic expansion was needed because the government hasnโ€™t raised the salary limit to keep up with inflation.

In 2016, it was estimated that the Obama overtime rule would extend overtime eligibility to 4.9 million workers and bring another 7.6 million workers who already are eligible for overtime below the threshold, thus making it harder for employers to deny them overtime protection. According to the Economic Policy Institute, under the Trump administrationโ€™s proposal, less than half as many workers would be either newly eligible or brought below the threshold.

But Obamaโ€™s decision to double the limit created outrage among powerful business groups. In brief, hereโ€™s what followed: Big business groups joined with 21 Republican-controlled states to sue the administration before the rule went into effect in 2016. The rule was put on hold during the legal dispute. A federal judge in Texas invalidated it in 2017, arguing that the Labor Department didnโ€™t have the authority to make such a drastic change.

Corporate America was relieved.

And instead of appealing the Texas courtโ€™s ruling, Trumpโ€™s labor secretary, Alexander Acosta, said he would create a watered-down version of Obamaโ€™s rule. Now the agency is only lifting the salary limit from $23,000 to $35,000 and scrapping the cost-of-living increases; that means about 2.8 million of the 4 million workers who expected to get overtime benefits wonโ€™t get them.

AFL-CIO President Richard Trumka called the new rule โ€œdisgraceful.โ€

โ€œ[This] is part of a growing list of policies from the Trump administration aimed at undermining the economic stability of Americaโ€™s working people,โ€ Trumka said.

The public can comment on the rule proposal for 60 days before the Department of Labor sends a final version to the White House for review. If the White House approves the new rule, which is likely, it will be the Trump administrationโ€™s latest victory in its quest to undo Obama-era regulations meant to benefit workers.

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