7 Things You Need To Know About Obama's New Overtime Rule

Currently, our overtime policy only pays an extra time and a half to those that earn less than $23,600 annually. That’s less than $455...

Workin’ Girl

In 2008, we made history by electing our first Black president and one of the most progressive presidents in U.S. history. Whether you like Barack Obama or not, you have to admit he has made some pretty boss moves while being our Commander-In-Chief. From ending the War in Iraq and turning around the U.S. automobile industry to legalizing same sex marriages and creating the affordable healthcare act, all while reducing the unemployment rate, Obama is definitely leaving our country in a better state than our past two presidents Bush and Clinton (yep, I said it and #IAintSorry).


To put the cherry on top of Obama’s many accomplishments as our POTUS, his administration has passed a major change to our current overtime regulations.

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Currently, our overtime policy only pays an extra time and a half to those that earn less than $23,600 annually. That’s less than $455 a week and doesn’t benefit middle-class workers that also work long hours and deserve more pay.

I know you're tired of being overworked and underpaid, and the "money gods" have heard your cries. Soon, under the new Overtime Rule, almost all salaried employees making less than $47,476 a year must be paid overtime. However, there are some special exceptions to this rule that you must know, and other factors that you should be educated on.

Here are the top 7 things you need to know about the new overtime policy and how it may or may not affect you.

1. The new rule will go into effect sooner than you think.

This new change will take effect on December 1st, 2016. That’s right, in less than one year, your bi-weekly pay check can make a turn for the best.

[Tweet "Starting Dec. 1st, 2016, if you make less than $47,476 you can receive overtime pay"]

2. You don’t have to be an hourly employee to benefit.

If you are a manager or other type of professional that doesn’t clock in or out, you can still benefit. As long as you make less than $47,476 and your company meets the Department of Labor’s criteria, the overtime law will work in your favor. This means for every hour you work beyond the standard 40-hour workweek, you will see your paycheck increase.

3. The minimum salary to receive overtime pay will change over time.

When the new rule takes effect, you will have to make less than $47,476 to qualify for overtime pay. This amount, however, will not be constant forever. The pay threshold will be readjusted automatically every three years to match the country's financial state. In other words, every three years the U.S. will analyze the salary for employees in the lowest-income Census region (currently it’s in the South). After analyzing this, the minimum salary to receive overtime pay move up or may move down.

4. Your boss may cut your hours to avoid giving you overtime.

If you currently work more than 40 hours a week, it’s possible that your hours may be trimmed down to strictly 40 hours to avoid your company paying extra money. If this doesn't sound like something you would be comfortable with, I recommend that you have a conversation with your supervisor now to see what their plan is for the new overtime rule.

5. Your pay could increase to the minimum pay threshold.

If your current pay isn’t that far from $47,476, it’s possible that your boss may increase your pay to avoid paying the extra overtime. The plus side of this is more coins in your pocket. The downside is that you may still work longer hours that won't equate to the money you are paid.

6. The new rule will be showing major love to minorities.

There is a pretty decent amount of Black and Hispanic middle-class workers that won’t meet the new threshold and will be eligible for overtime pay. To be exact, 1.5 million Blacks, who make up 8.9 percent of the salaried workforce, and 2.0 million Hispanics, who make up 11.8 percent of the salaried workforce, can benefit from the new law.

7. Even if you make less than $47,476, you still may not be eligible for overtime pay. 

Under the new law, almost anyone making less than $47,476 annually can benefit from this new rule. However, if you are apart of the following groups below, you may not be covered:

  • If the company you work at doesn’t make at least $500,000 in annual sales you will not benefit from this new law
  • If you work at a business that does not meet the government’s criteria for overtime pay, you may not be covered by this law, no matter how much you make. The Department of Labor has details on who is covered by the FLSA and you can check it out here. Some people included in this list are teachers, doctors, and lawyers.

[Tweet "Even if you make less than $47,476, you may not be eligible for overtime pay"]

Now that you know about this new law, what are your next steps? If you haven’t heard anything from your employer, you should definitely ask them about their plan for the new law and how it will affect you. Don’t wait until the new law begins to figure out if it will benefit you.

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