“That was a project to relieve as many employers as possible of their obligation to pay overtime,” says Ross Eisenbrey, vice president of the Economic Policy Institute, which receives some funding from unions. “So they started out with something that was worse than where it ended up, but they did a lot of damage.”
Halfway through his second term, President Obama decided to swing the pendulum back toward workers. In March, Secretary of Labor Tom Perez signaled that he planned to raise that salary threshold much higher, and over the summer held listening sessions with both workers and employers. He didn’t give an estimate of where it should end up, but labor advocates have some ideas.
According to an analysis by EPI, 65 percent of all salaried workers fell under the threshold in 1975, and were thus entitled to overtime. By 2013, just 11 percent of salaried workers were automatically due overtime pay, leaving the rest subject to a host of exemptions. EPI proposes raising the cutoff to $984 a week, or about $50,000 a year, which is simply what it was back in 1975, adjusted for inflation.
“If you raise the salary threshold high enough, then you catch everybody whose financial situation you really worry about,” Eisenbrey explains. That could include millions of white-collar workers in clerical and administrative roles, as well as low-level managers.