Wednesday, March 12, 2014

President Obama to Order Expansion of Overtime Pay

President Obama is expected to issue an order today directing the Department of Labor to expand the number of people who qualify for overtime pay under federal labor law.  According to reports in the Washington Post and other news outlets, the measure is intended to put more money in the pockets of salaried workers, such as fast-food supervisors and convenience store managers, who often are required to work more than 40 hours a week without receiving overtime pay.

Under the Fair Labor Standards Act, salaried workers who earn less than $455 per week must be paid overtime rates for all work beyond 40 hours in a workweek.  Obama’s proposed order would raise that threshold by some amount, thereby making more salaried workers eligible for overtime.

Cecilia Muñoz, the director of the White House Domestic Policy Council, told the New York Times that the move is designed to “potentially shift billions of dollars’ worth of corporate income into the pockets of workers.”  Predictably, business groups are furious about the president’s tactic, accusing the White House of being heavy-handed and abusing executive authority.

Obama has repeatedly said that he will use executive orders and regulations to push his fight against economic inequality.  The regulations covered by today’s order are subject to public comment before final approval by the Department of Labor.  If opposition to the regulations is strong enough, the White House could water down its proposals.

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