Am I entitled to overtime pay? Everything you need to know about the new salary rules

Getting a salaried job is great until you realize your bosses may now believe they own your soul and don’t need to pay overtime for it. You are always on the clock in their minds. Thankfully, a final rule announced on Tuesday by the U.S. Department of Labor (DOL) is working to change that for millions of salaried workers.



The rule amends the Fair Labor Standards Act section 13(a)(1). Under these new guidelines, lower-paid salary workers who work more than 40 hours a week will receive overtime protections . Say hello to time and a half and possibly even double time.



Who qualifies for overtime under the new rules?



The rule impacts standard salaried workers and those considered “ highly compensated employees ” (HCE) who make under certain thresholds. It will kick in this year.




On July 1, 2024 : If you earn less than $844 per week ($43,888 per year), you are eligible for overtime. HCEs who earn under $132,964 per year are also eligible for overtime.



On January 1, 2025 : If you earn less than $1,128 per week ($58,656 per year), you are eligible for overtime. HCEs who earn under $151,164 will also be eligible for overtime.



Beyond 2025 : The thresholds will further increase every three years beginning on July 1, 2027.




Acting Labor Secretary Julie Su is excited about these changes. “This rule will restore the promise to workers that if you work more than 40 hours in a week, you should be paid more for that time,” she stated. “Too often, lower-paid salaried workers are doing the same job as their hourly counterparts but are spending more time away from their families for no additional pay. That is unacceptable.”



The National Employment Law Project is also on board. “Rather than relying on unpaid or off-the-clock overtime hours, businesses may now choose to reassess workloads, consider hiring additional staff, and/or convert part-time workers to full-time,” the advocacy group stated in a press release. “This shift will foster both a healthier work-life balance and an environment where employees are compensated with fair pay, which can also result in new hiring.”



Many in the business community are less enthusiastic about these changes, including Beth Milito, who works as the executive director of the National Federation of Independent Business’s Small Business Legal Center. “This rule is another costly hoop for small business owners to jump through,” she lamented . “Small businesses will need to spend valuable time evaluating their workforce to properly adjust salaries or reclassify employees in accordance with this complicated mandate.”



Some are already planning to challenge this ruling in court. President Biden could see himself in a similar situation faced by President Obama in 2016 . Twenty-one states partnered with business groups to sue him after his attempt to raise the salary threshold. A Texas judge issued an injunction. When President Trump took office he chose not to defend Obama’s policy.