New Overtime Legislation Bill Passes in the House

On Friday, the House of Representatives voted 213-210 to move forward with the Bush administration's proposal to change federal overtime rules.

Democrats and labor groups have shunned the legislation, claiming as many as 8 million workers will no longer qualify for overtime compensation should the new rules become law. Friday's close vote, had it passed, would have blocked the overtime legislation.

The Bush administration, on the other hand, describes how the legislation will add 1.3 million lower income workers to the overtime rosters if they log more than 40 hours per week. Proponents of the bill, including members of the U.S. Department of Labor, say that only about 644,000 white collar workers will lose their ability to get overtime should the measure become law.

The proposed legislation would raise the salary threshold below which workers would automatically qualify for overtime. The current threshold under the Fair Labor Standards Act (FLSA) is $155 a week. Workers that earn more than that threshold are described as white collar employees and are not entitled to overtime pay. New rules would amend the Act to change the threshold to $425 a week, which would open overtime opportunities to 1.3 million workers.

The proposed changes would eliminate overtime pay for anyone making at least $65,000 per year. Certain employees who are classified as managers, administrative workers, or professionals, would not qualify for overtime pay. The DOL states that the proposed duties tests will make entitlement to overtime more certain for 10.7 million workers.

The Department of Labor is promoting the changes on its Web site, claiming that the proposal "will strengthen overtime for the most vulnerable low-wage workers and allow for stronger Department of Labor enforcement of this important worker protection."

The existing regulations under the FLSA were written in 1949, and they make reference to job titles that no longer exist, such as keypunch operators, straw bosses, leg men, and gang leaders. The new act will clarify which types of jobs qualify for overtime.

You may like these other stories...

Without getting into all that's been written about the jobless recovery and record high corporate profits without the accompanying hiring, there has indeed been a fundamental shift in how corporate America is working...
Read more by Rita Keller here.I recently read a tweet by my music-teacher son regarding his fifth-grade musicians: “My fifth-grade flutes and clarinets just exhaust me. They have so much energy and ask sooooo many...
By Richard D. Alaniz  On June 24, 2013, the US Supreme Court narrowed the definition of who qualifies as a "supervisor" for the purposes of harassment cases. This holding is a significant win for...

Upcoming CPE Webinars

Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.