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The U.S. Department of Labor recently announced a proposal to potentially extend overtime pay benefits to millions of low-paid salaried workers. Under the proposal, those who meet certain work and salary conditions would be entitled to guaranteed overtime pay. While this is only a proposed rule, it could result in further protections for over 3.5 million workers. Find out what this could mean for the wallets of millions of hard-working Americans.

A proposed overtime rule could be a financial win for millions

On Aug. 30, the U.S. Department of Labor announced a notice of proposed rulemaking that could ensure more Americans are paid for overtime work. The proposal would guarantee overtime pay to millions of low-income U.S. workers currently exempt from receiving it.

Under the proposed rule, salaried workers in executive, administration, and professional roles earning less than $1,059 per week or $55,068 annually would be eligible for guaranteed overtime pay. Current federal rules only require employers to pay salaried workers in those roles overtime if they earn an annual salary at or below $35,568.

Many salaried workers meeting the newly proposed conditions put in well over 40 hours per week at their jobs — but don’t receive additional compensation for the extra work they do due to current regulations.

Unlike their hourly colleagues entitled to overtime pay benefits, these workers don’t receive time-and-a-half for hours worked beyond a 40-hour work week. That means they’re putting in additional work, but not getting paid extra.

The rule also proposes automatically updating the salary threshold every three years to reflect current earnings data and would extend overtime pay benefits to workers in U.S. Territories. If overtime pay requirements were to change, this could ensure that more salaried workers are paid fairly.

Getting paid time-and-a-half for overtime work could be a significant win for the bank accounts of many Americans. These changes could impact 3.6 million American workers.

How the rulemaking process works

As noted above, this is only a proposed rulemaking at this time. Here’s what you need to know about the rulemaking process:

First, the Department of Labor submits a notice of a proposed rulemaking. Then, it’s published in the Federal Register. Once published, there is a 60-day period where the proposed rulemaking is open for public comment.

During that time, members of the public, including workers, retirees, business owners, and advocates, can provide public comments on the matter. The department reviews and considers all public comments before making a final rule.

This proposed rule was published in the Federal Register on Sept. 8, 2023. That means written comments will be accepted until Nov. 7, 2023. You can review related documents and comments or submit commentary by visiting the rulemaking docket.

Could more workers get paid for overtime?

Only time will tell what will be included in the Department of Labor’s final ruling. But hopefully, it will be positive news for the many workers currently ineligible for overtime pay.

If the proposed rule is enacted, it could be a win for many Americans who aren’t getting paid for their extra work. More workers would be eligible to receive extra pay for overtime hours or could benefit from greater work-life balance by only being required to work a 40-hour work week.

Due to rising living costs, many people seek ways to keep more money in their pockets. For money-saving tips, check out our free personal finance resources.

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