Trump Overtime Rule Takes Effect, Resolving Long-Standing Concern That Roughly 8 Million Salaried Workers Might Be Paid For The Hours They Work Past Forty

The Filing

WASHINGTON. The Department of Labor confirmed Wednesday that its new overtime rule had taken effect with the start of the new year, raising the salary threshold for guaranteed time-and-a-half pay to $35,568 and thereby resolving a long-standing concern that roughly 8 million salaried Americans might otherwise have been compensated for the hours they worked beyond forty.

The rule, finalized in September 2019, replaces an Obama-era regulation that would have set the threshold at $47,476, a figure administration officials described as dangerously close to what many of the affected workers actually earn. Under the new standard, a salaried employee making $36,000 a year can be asked to work fifty, sixty, or seventy hours in a week, and the Department has clarified that the correct additional payment for those hours is zero dollars.

"For too long, an assistant manager earning forty thousand dollars was just one Obama regulation away from being paid more for working more," said a senior Department of Labor official, who explained that the prior rule had threatened to introduce a direct relationship between hours worked and money received. "We have restored the simpler arrangement, in which the salary is the salary, the week is whatever the employer decides the week is, and everyone goes home whenever the schedule permits."

Economists noted that the roughly 8 million workers left out by the lower threshold are concentrated in retail, food service, and front-line supervisory roles, the precise jobs in which a person can most reliably be assigned a sixtieth hour. Administration officials characterized this as a feature, arguing that exemption from overtime protection grants these workers the flexibility to remain at their workstations for as long as is needed.

The Department emphasized that affected employees retain the right to negotiate individually with their employers, a process officials described as identical to the right to overtime pay except that it does not result in overtime pay. "Nobody is forcing these Americans to work unpaid hours," one official said. "They are free to be paid for those hours by an employer who has chosen, lawfully, not to."

At press time, an assistant store manager in Ohio had completed her forty-seventh hour of the week and was being thanked for her dedication.

Who Benefits

§President Trump, who could add a long-promised rollback of an Obama-era worker protection to his deregulatory record without spending political capital, since the rule's costs fall on employees rather than on voters who follow federal rulemaking.
§The Trump Organization, whose hotels, golf clubs, and restaurants employ exactly the salaried hospitality managers in the $35,568 to $47,476 band, meaning the family business's own overtime liability shrank the moment the rule took effect.
§The National Retail Federation and the National Restaurant Association, whose member companies had lobbied for years against the higher Obama threshold and now retain the ability to schedule supervisory staff for unlimited hours at a fixed salary.
§The U.S. Chamber of Commerce and allied business groups, which had campaigned and litigated against the 2016 rule and secured a replacement set roughly $12,000 lower.
§Large retail, hospitality, and logistics employers, who collectively avoided the payroll cost of compensating roughly 8 million newly ineligible workers for their overtime hours.

Sourced to the public record · presented without editorial embellishment