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Last night the White House proposed a change in a Department of Labor rule that would, in effect, give many Americans a raise. Under the proposed rule, as many as 5 million more people would suddenly find themselves eligible for overtime pay.
So, how does that affect startup employees who often work long hours in salaried positions? Well, it depends on how much you make and how long you work.
The old rule says that white collar, salaried employees are eligible to earn overtime if they work over 40 hours a week but make less than $23,660 a year. Keep in mind the poverty line for a family of four is $24,250.
Under the new rule, however, the income threshold would more than double to $50,440 a year. That threshold would then be pegged to the 40th percentile of income – which, incidentally, was the level it was originally set at when an overtime rule was first created in Franklin D. Roosevelt’s time. That change would extend overtime protection to about 80,000 more people in Colorado and cover around 40 percent of the entire working population of the country.
So, who’s most likely to be affected by the new rule? The White House is guessing the new rule will disproportionately affect Millennials (4.8%), those with a bachelor’s degree (5.7%) and women (3.2%). But really, it’ll likely affect you if you work long hours and take home a salary below $50,440 a year.
This rule could go into effect as soon as next year, and we’re supposed to hear more from Obama on the subject this Thursday.
In the meantime, here’s who the White House predicts will benefit:
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