
AUGUST 2004 |
New Overtime Rules to Take Effect |
After months of heated debate, the most sweeping changes to the nation's overtime rules in more than 50 years are now in effect. Workers who earn less than $23,660 annually will automatically be eligible for overtime pay, a boost from the current threshold of $8,060 set in the 1970s. The rules have been the source of political contention for months. The Senate voted to block the rules in May, in an effort pushed by Sen. Tom Harkin (D-IA).
Salaried workers who fall between $23,660 and $100,000 a year might lose overtime based on a duties test, which describes the tasks that determine whether a worker can, for example, be classified as a professional ineligible for overtime. Those making more than $100,000 will lose their overtime rights unless they do not regularly perform professional, administrative or executive duties.
The Department of Labor says it changed the rules because they desperately needed updating. The old rules did not mesh with the new economy, causing increased litigation, officials argued. Overtime class-action suite have doubled since 1997, and outnumber discrimination suits for the first time. Labor recovered $212 million in back wages in fiscal year 2003.
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