Washington, D.C.—Today, U.S. Senator Bob Casey (D-PA), Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Subcommittee on Employment and Workplace Safety, joined by eight Senators, introduced legislation to restore overtime protections for low- and mid-wage salaried workers. The Restoring Overtime Pay for Working Americans Act would help to restore the 40-hour workweek for these workers. Today, only 12 percent of salaried workers are guaranteed overtime pay based on their salaries, compared to 65 percent in 1975. This bill would restore overtime protections by guaranteeing coverage to approximately 47 percent of salaried workers, would ensure that people who work more get paid more, and boost incomes for those who work longer hours.
“This legislation will increase take-home pay for thousands of Pennsylvanians and ensure that more workers are given a fair shot to receive the overtime pay they’ve earned,” Senator Casey said. “This is a commonsense proposal that will update overtime protections for workers to match the realities of the workplace.”
Senators Tom Harkin (D-IA), Sherrod Brown (D-OH), Barbara Boxer (D-CA), Patrick Leahy (D-VT), Ed Markey (D-MA), Patty Murray (D-WA), Bernie Sanders (I-VT), and Elizabeth Warren (D-MA) joined Casey in introducing the bill.
Key provisions of the Restoring Overtime Pay for Working Americans Act include:
- Gradually raising the overtime salary threshold for executive, administrative and professional (EAP) workers from $455 a week to $1,090 a week to match the inflation-adjusted level from 1975, the last time the threshold was set at an appropriate level given salary levels at the time. The new threshold would be phased in over several years and indexed to inflation after that. This would ensure that low- and mid-wage workers earning less than this threshold will be automatically eligible for overtime pay.
- Gradually raising the threshold for “highly-compensated employees” from $100,000 to $125,000, based on inflation since the concept was introduced in regulations in 2004, and indexing it to inflation after that. Employees earning above this threshold are more likely to be exempt from overtime than other white collar workers because they have a less stringent duties test that is used to determine their overtime eligibility.
- Creating a commonsense definition of the term “primary duty.” This term is used in regulations to determine if a worker’s duties are eligible to be overtime exempt. Prior to 2004, a primary duty was that which was performed the majority of the time. Regulations issued in 2004 removed that 50 percent threshold, creating a loophole that allowed a worker to be exempt even if he or she only spends a few hours a week supervising or doing other exempt duties. This is a common occurrence today for employees like first-line supervisors in stores and restaurants. This bill would restore a 50 percent threshold.
- Establishing recordkeeping penalties. The bill would establish penalties for violations of the recordkeeping provisions of the Fair Labor Standards Act (FLSA). The penalties would be the same as for violations of minimum wage or overtime: up to $1,100 if the violation is willful or repeated. This will create a strong incentive for employers to keep required records of hours, wages, bonuses, and commissions.