New overtime rules for salaried workers on the way

In most parts of the country, a salary of $24,000 a year doesn’t get you very far. But if you are a salaried employee making that much or more, and are classified by your employer as an administrative, executive or professional employees, you are not legally entitled to overtime pay.

Think for a minute about what that means. If you are earning a low salary but are driven to earn more money to provide a better life for your family, overtime isn’t going to help you. Your employer can require you to work more than 40 hours per week without any additional compensation.

Luckily for everyone working a salaried (but not very high-paying) job, President Obama recently called for a significant increase in that salary limit. Details are still taking shape, and there’s no real indication of where the new limit will be set, or when the rules will change.

Nevertheless, it gives workers in the service industry – who are far more likely to feel the bite of the current regulations – cause for hope that they might finally see a more fair system of compensation for all the extra time they put in at work. It also offers some hope to the unemployed, who may find employers adding more positions as a means to avoid paying overtime.

As I told the Tampa Bay Times:

• “A lot of employers depend on people making $30,000 a year, lean on them a lot, expect a lot of hours from them, and don’t pay them overtime,” said Steve Wenzel, a founder of Tampa employment law firm Wenzel Fenton Cabassa P.A. “It’ll put smiles on the faces of a bunch of workers, and that’s never a bad thing.”

Indeed, the practice of cutting labor costs by assigning more work to salaried managers instead of hourly (and overtime-eligible) employees has been going on for years. Not only is it unfair to both salaried and hourly workers, but because it often leads to businesses under-staffing their workplaces, it can result in a worse experience for customers as well. It’s been a huge loophole in our employment and labor laws for a long time, with disastrous results.

We represent workers, so it’s probably not a huge surprise that we at Wenzel Fenton Cabassa P.A. are strongly in favor of this rule change. We think anything that rewards hard workers, creates more opportunities for workers and boosts the economy is a good thing – don’t you?