The fight over expanding overtime pay

The smartest insight and analysis, from all perspectives, rounded up from around the web:

"Millions of Americans will get a raise beginning Dec. 1, and not because their employers will have a sudden outbreak of Christmas generosity," said Helaine Olen at Slate. That's when new federal rules take effect requiring employers to pay time-and-a-half wages to salaried employees who work more than 40 hours per week, provided they earn less than $47,476 annually. That's double the current threshold of $23,660; the Obama administration estimates that more than 4 million workers will be affected. "This change was way overdue." The last time the overtime rules were adjusted was in 2004, when the salary threshold was bumped up from a mere $8,060. Now it will be updated every three years, pegged to the 40th percentile of income for full-time, salaried employees in the lowest-wage region of the U.S.

"This mandate will hurt more workers than it helps," said The Wall Street Journal in an editorial. "Few will likely see a raise." Instead, businesses will probably convert salaried employees to hourly status or hire more part-time and temp workers to avoid the onerous new requirements. Other companies will bump workers' pay above the new salary threshold to avoid the mandate, but offer fewer benefits and bonuses. Still others will "divert money from wages or investment" to implement new timekeeping systems that prevent workers from going past 40 hours per week. Perhaps scaled-back hours will translate into employees having more free time, but "most salaried workers would prefer the extra pay, thank you very much."

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

It's a little odd that "in response to the new regulation, employers are casting themselves as worker advocates," said E. Tammy Kim at The New Yorker. Industry groups like the National Retail Federation argue that the new rules will force businesses "to cut hours and revert employees to clock-in, clock-out wage laborers." But those same businesses have used every excuse possible to whittle down the share of salaried workers clearly eligible for overtime, from 62 percent in 1975 to just 8 percent today. One clever dodge is bestowing "fancy" managerial titles on otherwise low-paid workers, like "floor manager" or "gas-station supervisor," to make them exempt. As a result, millions of people work 50, 60, even 70 hours a week without getting time and a half.

The new rules may not have much impact either way, said Eric Morath in The Wall Street Journal. Extending overtime to 4.2 million people "sounds like a lot," but that figure represents fewer than 3 percent of all U.S. workers. Increasing the minimum wage to $15 an hour nationally, however, "would affect a third of the workforce." Whatever happens, this is a welcome conversation about wages, said E.J. Dionne in The Washington Post. In the midst of a presidential campaign "supposedly about the disinherited and disaffected," there's been surprisingly little interest in actual policies that "would benefit those who are struggling." Republicans in Congress have vowed to fight these "much needed" new rules, and I, for one, hope that they do. "Let's get members of Congress on record about overtime."