Tomorrow President Obama is expected to announce details of new proposed guidance from the Department of Labor that would extend overtime protections to nearly 5 million workers, including approximately 400,000 Texans.
The new protection will update the Fair Labor Standards Act, which includes the requirement for businesses to pay time-and-a-half to hourly employees and certain salaried employees after 40 hours of work in a week. This important and long overdue update will more than double the salary level at which white collar salaried workers will be eligible to receive overtime pay, from the current $23,660 to $50,440 sometime in 2016.
For too long, businesses have been able to avoid paying overtime to many employees by classifying them as salaried managers, even when their weekly pay is relatively low and their jobs lack supervisory responsibilities. The new salary level, which will be adjusted for inflation, is expected to include many lower and middle-wage workers who are now classified as managers.
Texas is among the states with the most to gain from the overtime change—approximately 400,000 Texans would be affected, representing 8.5 percent of workers nationally. While state leaders frequently cite Texas’ outsized job growth relative to other states since the recession, they rarely mention that many of the new jobs created are low-wage. This contributes to the high number of Texans who are likely to be entitled to overtime protection under the new Labor Department guidance.
This change will happen through an administrative process already underway, and it does not require Congressional approval.
At a time when Texas’ leaders prevent cities from being able to set their own, higher minimum wage, and when they have refused voters the right to decide a higher statewide minimum wage, these changes to overtime protections will benefit thousands of hardworking Texans who have struggled in the wake of the recession.
See our recent report on the minimum wage in Texas.