When it comes to long overdue changes in the Labor Department’s rules governing overtime pay, it appears workers will wait a little longer.
“We’re a few months away from getting them out the door, and that will leave plenty of time to implement the rule,” said Jeffrey Zients, director of the president’s National Economic Council.
Speaking Friday to reporters at a Christian Science Monitor Breakfast, Zients didn’t offer much clarity as to why the rule change promised by President Barack Obama via executive order in March 2014 remains in the offing. It was even teased during Obama’s State of the Union Speech, but remains months away from being unveiled.
Zients did, however, suggest the new threshold won’t reflect a minor change.
“We want to make sure that workers are earning what they deserve, and at the same time that we have a competitive economy in what is increasingly a global economy,” he said. “The (overtime) level is so outdated at this point that there is an opportunity to move significantly.”
Obama last March announced an executive order that instructs his labor secretary to come up with a plan to create overtime pay for millions of workers who are operating under limits set back in 2004. Hourly workers are guaranteed overtime pay, but the current federal rule limits overtime pay for salaried workers to those earning less than $23,660 for a 40-hour work week.
The administration argues that many full-time workers earning more than the threshold are in reality are part of the working poor. Where the administration sets the new threshold will help redefine the perception of a living wage.
“Given that it’s set at $23,000 for salaried workers, we think there is opportunity to make a significant change there,” said Zients.
Some liberal groups such as the think tank Economic Policy Institute have advocated a salary threshold for overtime pay as high as $50,000. The administration is thought to be looking in the ballpark of similar rules in California and New York which are more than a third higher than the current federal threshold.