I don’t know about you, but if it’s past 5 o’clock on a Friday and I’m working overtime, I’m definitely making sure I’m getting paid for it.
Unfortunately, there are currently many salaried U.S. workers who have to tolerate overtime without pay as a result of outdated federal rules. But it looks like the rules are about to change.
Last week, President Obama signed a presidential memo directing Secretary of Labor Tom Perez to modernize federal rules governing overtime pay (meaning, time and one-half pay after a 40-hour work week.)
Currently, salary workers are denied overtime pay if they are classified as “executive, administrative and professional” and make more than $455 a week, meaning many salaried workers make far less than they deserve based on the work they put in week after week.
“Too many people are working hard and falling further behind.”
Modernizing overtime rules makes more workers eligible for overtime pay, meaning more money in the pockets of hard-working Americans.
The new overtime laws would also benefit business owners and companies by providing them with long term and stable employment as opposed to more minimum wage workers. According to Perez, many small businesses already pay more than minimum wage, up to $14 an hour, because it helps attract and retain long-term productive workers.
By expanding overtime availability, the new overtime laws would provide more individuals and families with the money needed for economic mobility. They would have more freedom to spend and invest, stimulating economic activity from the base.
President Obama’s reasoning for the memo is quite simple:
“If you have to work more, you should get paid more.”
This is the basic principle of free market economics. This is what our parents and teachers taught us. This is why people from all over the world seek employment in the U.S. Added up all together, it’s for reasons like this that the United States is the world’s largest single national economy.