(WASHINGTON, D.C.)—Today, U.S. Senator Patty Murray (D-WA) a senior member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, along with HELP Committee Chairman Tom Harkin (D-IA) and seven Senate Democrats, 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.
“Out-of-date overtime laws are preventing Americans from getting paychecks that reflect their hard work, and that hurts their families and our economy,” said Senator Murray. “People who work more deserve to be paid more, and I am proud to support this commonsense legislation to ensure that Americans who work hard and play by the rules are fairly compensated.”
Senators Tom Harkin (D-IA), Sherrod Brown (D-OH), Barbara Boxer (D-CA), Bob Casey (D-PA), Patrick Leahy (D-VT), Ed Markey (D-MA), Bernie Sanders (I-VT), and Elizabeth Warren (D-MA) introduced the bill with Senator Murray.
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.