President Obama hopes to continue the positive trends, and proposes a plan to give a significant amount of Americans an economic boost. The President acknowledges a trending problem in the way many employers avoid giving overtime pay.
Federal regulation currently places a salary cap for those eligible to receive overtime at $23,660, leaving out a large amount of workers, particularly women, who receive no overtime pay for working more than 40 hours a week. It is a regulation that was instituted 40 years ago, and President Obama feels it no longer reflects the realities of the working middle class. The President's new rule would allow workers who earn up to $50,440 to demand the standard time-and-a-half pay for work past 40 hours.
"As president, my top priority is to strengthen the middle class, expand opportunity and grow the economy," Obama writes. He then asks, "Will we accept an economy where only a few of us do exceptionally well? Or will we push for an economy where every American who works hard can contribute to and benefit from our success?"
Women will likely benefit most from this move, as Time magazine writes, "With average income hovering around $35,154, unmarried women previously experience the double whammy of earning less income than their single male counterparts (single men earned an average of $50,625 in 2013), and being unable to earn overtime pay."
Particularly in the retail industry, companies are finding ways to skirt around overtime compensation laws giving employees managerial titles, without pay compensation. Employees with managerial titles are not entitled to ask for overtime compensation, and can therefore work upwards of 80 hour work weeks without any additional pay. The President commented on this phenomenon earlier this year:
"What we've seen is, increasingly, companies skirting basic overtime laws, calling somebody a manager when they're stocking groceries and getting paid $30,000 a year," Obama said. "Those folks are being cheated."
The proposal must undergo a public comment period before going into effect, and is expected to be implemented in 2016.
Media Resources: Huffington Post 6/29/15; 3/21/15; Feminist Newswire 6/25/15; 6/26/15; 6/29/15; Time Magazine 6/30/15
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