People’s Response to the Final Rule

The Final Rule – What is it?

Going into affect on December 1st, 2016, a new labor regulation will increase the salary threshold for paid overtime. Before this rule, workers earning less than $23,660 annually were entitled to overtime pay. This new regulation changes the rule and increases the qualifications up. Now, workers who earn less than $47,476 annually can now qualify for overtime pay if they work more than 40 hours a week.

If you make less than $47k a year, you will be eligible for overtime if you work past the standard 40 hour week. Job title or description does not matter anymore.

What Does This Mean?

The Department of Labor

(DOL) determines that this new rule will extend overtime protections to 4.2 million workers in the United States. The Final Rule will have a positive effect on 12.5 million Americans, according to the Economic Policy Institute (EPI).

Employers have options in how they want to organize their work force around the Final Rule.

They can raise the salary of employees in order to pass the $47K mark and continue to pay salary based wages. Pay the time-and-a-half overtime for employees that work past 40 hours a week, or simply avoid paying overtime by scheduling their employees to work 40 hours or less.

DOL estimates that 2.3 million women will eligible for the potential pay boost. This will have a noticeable impact on 28% of both Hispanic and black salaried employees who will now be eligible for overtime pay.

Pros vs. Cons of the Final Rule

The business community is split on whether or not this new rule will damage or improve the economy.

The Washington Post

investigation concluded that many small businesses and other employers will be forced to switch some employees from salary to hourly in order to comply with the Final Rule. The National Retail Federation released a statement calling the Finale Rule a “career killer”.

On the other hand, Labor and union groups are rejoicing over the Final Rule. The unions feel that this new rule will create new jobs. Companies that avoid paying overtime will have to hire new employees to make up for the hours that would have fallen on one person. People that lose their salary wage for hourly will be no longer work 40+ hours a week without overtime. Instead, they will work the standard work week, and be eligible for overtime if needed.

Christine Owens, of the National Employment Law Project, stated, “Employers have a lot of flexibility.” These new rules can potentially make things easier for employers.

Wrongfully Terminated from Work? A Wrongful Termination Lawyer Can Help

The Final Rule may cause change in the job industry. If you were fired and feel it was unjustified Jeff is here 4 you! Davis Law Firm is here 24/7 to listen to your case and fight for what you deserve. We offer free consultation with our team of legal representatives, so don’t wait another day contact us today!