Millions of Workers May Be Eligible for Overtime Under New Biden Rule

The United States Department of Labor revealed that millions of workers may be eligible for overtime pay under President Joe Biden’s new rule.

The Biden-Harris administration announced a final rule that expands overtime protections for millions of lower-paid salaried workers by increasing the salary thresholds required to exempt an employee from federal overtime pay requirements. 

Effective July 1, 2024, the salary threshold will rise to the equivalent of a $43,888 annual salary. On Jan. 1, 2025, it increases further to $58,656.

The July 1 increase alters the current annual salary threshold of $35,568, which was mandated in a 2019 overtime rule update. Then, beginning on July 1, 2027, salary thresholds will be updated every three years by studying up-to-date wage data to establish new salary levels.

“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,” said Acting Secretary Julie Su in the U.S. Department of Labor’s press release. “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 Biden-Harris administration is following through on our promise to raise the bar for workers who help lay the foundation for our economic prosperity.”

A hard day’s work deserves a fair day’s pay. Our new rule will benefit millions of workers, including many who have been working 40+ hours/week without any extra pay, by ensuring they gain overtime protections or a raise in salary or compensation level. https://t.co/ZtFKvh9APd pic.twitter.com/tG5pGh8R5G

— U.S. Department of Labor (@USDOL) April 23, 2024

The new calculations came after the U.S. Department of Labor discussed relevant data with employers, workers, unions, and other stakeholders before releasing its proposed rule in September 2023. The Department of Labor ruling ensures that lower-paid salaried workers “receive their hard-earned pay or get much-deserved time back with their families,” claims Wage and Hour Administrator Jessica Looman.

According to Looman, “This rule establishes clear, predictable guidance for employers on how to pay employees for overtime hours and provides more economic security to the millions of people working long hours without overtime pay.”