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The Business, Entrepreneurship & Tax Law Review

Authors

Morgan Westhues

Abstract

The United States Department of Labor recently revised its overtime regulations for white collar workers to keep up with the changing economy and inflation. While the salary level for who can receive overtime pay needs to be elevated, the proposed elevation to the salary level under the Obama Administration is too drastic. The proposed overtime regulations essentially double the current salary level for overtime eligibility. This drastic increase is already having negative effects on employees, even though it has not yet gone into effect. To prepare for the new regulations to take effect, employers have begun to find ways around the law, disqualifying employees from receiving overtime pay that would begin receiving it under the new regulations. The new overtime regulations are not meeting its intended purpose of extending the right to overtime pay to more employees and, therefore, should not go into effect. This article proposes that the new salary threshold for overtime eligibility be set at $35,000, meaning that anyone making below this amount per year would qualify to receive overtime pay. Raising the salary threshold to $35,000 would still inevitably make more Americans eligible to receive overtime, while not increasing the threshold so drastically that employers cannot afford to pay the additional overtime pay.

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