This Is the New Overtime Pay Threshold for 2020 [updated]
If you work overtime, you should get paid for it, right? How about getting them one and a half time? The good news is that you may be eligible under the Department of Labor’s new overtime rule.
If you meet the following criteria, the Fair Labor Standards Act requires you to be paid at least 1.5 times your normal pay for any hours you work more than 40 per week:
- You make less than $ 684 per week, which is the equivalent of $ 35,568 per year.
- You earn more than $ 35,568 per year and are not eligible for any benefits based on your job function or industry.
If you are an “educated professional” (you probably have an advanced degree), creative professional, teacher, third-party salesperson, lawyer, or doctor, you are probably not eligible for overtime under these rules. … There are also exceptions for job descriptions, which are mostly administrative, managerial, or professional. Once you hit the $ 107,432 annual salary, you will most likely be exempt from overtime pay.
If you receive bonuses or commissions in your position, your employer can credit 10% of that income towards your salary level. If you do not earn enough bonuses or commissions during the year to remain tax-exempt, your employer can make the catch-up payment once.
The Labor Department issued the final rule in September and it went into effect on January 1. The change is expected to give an additional 1.3 million people eligibility for overtime pay. It is a common misconception that only hourly workers are entitled to overtime pay; many employees are eligible to participate if they are not managing others or participating in the development of the business (as a manager would).
You may recall that the Obama administration announced back in 2014 that it would double the threshold to $ 47,000. But the change was invalidated by a federal judge in 2017 after many objections, including a huge lawsuit, explains Vox . Then the Labor Department under President Trump said it would raise the wage cap from $ 23,000 (which was set back in 2004) to about $ 35,000.
Think your employer is breaking the overtime rules? Not sure if your role is tax exempt? If your company’s human resources department did not answer your questions, you can contact the Labor Department (WHD) Payroll and Hours Department at 1-866-487-9243 to contact the office closest to you. You can also find a WHD office near you on the Internet .
You will need to include your name, contact information, your company and manager’s contact information, the type of work you did, and how and when you were paid. Your questions and complaints are confidential.
This post was posted on 1/8/2020 and was updated the same day to correct and clarify overtime pay eligibility.