The new overtime rule will directly benefit 12.5 million working Americans.

The New Overtime Rule Will Directly Benefit 12.5 Million Working Americans

It’s a good day for the middle class! Today, the Department of Labor finalized its new overtime rule, which will benefit 12.5 million workers by raising the overtime salary threshold and grow the economy. Middle class families are working harder than ever, pinched by the rising cost of basics like health care, child care, and housing while their incomes struggle to keep up. The overtime rule restores a key middle class wage protection that will help make sure that Americans get more money for work they’re already doing.


The new overtime rule doubles the current salary threshold under which most salaried workers are guaranteed overtime—from $23,660 to $47,476. This means that workers earning under that amount will get overtime for the hours they work over 40 every week. Additionally, under the new rule, the threshold will be automatically updated every three years to make sure workers continue to earn the pay they deserve.

Americans are overdue for an overtime update. In 1975, more than 65 percent of salaried workers were covered by overtime protections because their earnings fell under the threshold. Today, only 8 percent do. The overtime rule brings overtime in line with today’s economy.

The administration’s plan to restore overtime will directly benefit millions of working Americans, putting more money in their pockets or giving them more time to balance obligations at home and work. Here are a few key numbers from the Economic Policy Institute showing the benefit of the new rule:

  • 4.2 million: number of Americans who will be newly eligible for overtime pay under the new rule.
  • 6.4 million: number of women who will directly benefit from the new rule. Women make up more than half of all directly benefiting workers.
  • 4.5 million: number of millennials who will benefit. Millennials make up 28.2 percent of the salaried workforce but 36.3 percent of all directly benefiting workers.
  • 1.5 million: number of African American workers who will benefit. African Americans make up 8.9 percent of the salaried workforce but 12 percent of directly benefiting workers.
  • 2 million: number of Hispanics who will benefit. Hispanic workers make up 11.8 percent of all salaried workers but 16 percent of directly benefiting workers.

The benefits of the new rule go beyond just those directly impacted. Restoring overtime protections gives middle-class families more money to spend at local businesses, boosting the economy and creating more jobs. Plus, the rule gives businesses an incentive to hire more workers: businesses that don’t want to pay overtime will have the option of hiring new part-time workers as an alternative. In fact, even the National Retail Federation, which opposes the overtime rule, says restoring overtime would create jobs.

The rule is the result of more than 270,000 public comments and input from employers, business associations, small businesses, workers, non-profits, educational institutions, and state and local government representatives. It is set to take effect on December 1, 2016. But already conservative lawmakers have vowed to oppose the rule. Speaker Paul Ryan referred to the rule as an “absolute disaster” and Rep. Chabot (R-OH) called the rule a “job-killer.” These opposition statements repeat the same, tired trickle-down soundbites we hear every time we take action boost wages for American workers.

BOTTOM LINE: It is a good day for the middle class. The Department of Labor’s new overtime rule will grow middle class paychecks and help working families get ahead. And by addressing stagnant incomes and inequality, the overtime rule will help our whole economy grow from the middle out, not the top down.

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