A 2016 federal rule would have raised the salary threshold below which workers are automatically eligible for overtime pay—from $23,660 to $47,476 per year—restoring some of the coverage to inflation. Under the Fair Labor Standards Act, workers eligible for overtime must be paid “time-and-a-half” or 1.5 times their regular pay rate for each hour of work per week over 40 hours. Currently, hourly workers in most service and blue-collar jobs are guaranteed the right to overtime pay.
For salaried workers, the right to overtime is determined by their pay and nature of work. Currently, salaried workers who earn below $455/week ($23,660/year) are eligible for overtime, but workers who earn more than $455/week can be exempted from overtime if their occupations are considered professional, administrative, or executive.
The current salary threshold has not kept pace with inflation or the changing economy. In 1975, the overtime salary threshold covered about 62 percent of all salaried workers, compared to just 8 percent today. Had the threshold kept pace with inflation since 1975, it would be about $52,000 today. The 2016 rule would have largely restored its lost value.
However, a district court in Texas determined that the rule was invalid, but even before the district court ruling, the Trump Labor Department had announced that it was reevaluating the overtime rule in light of stakeholder concerns that the threshold in the 2016 rule was “too high.”
The 2016 overtime rule would have benefited 12.5 million people, including 6.4 million women and 4.2 million parents. In West Virginia, 66,000 workers would have benefited from raising the salary threshold for overtime protection from $23,660 to $47,476 a year, nearly a third of the salaried workforce. West Virginia would have had the largest increase in workers covered of all 50 states.
With the loss of the rule, workers earning as little as $455 per week can be forced to work 60–70 hours a week for no more pay than if they worked 40 hours. The extra 20–30 hours are completely free to the employer, allowing employers to exploit workers with no consequences. Under the updated rule, affected workers who work more than 40 hours a week would get more money, either through overtime pay or through increased salaries to meet the new threshold.
The loss of the rule also means a loss of a better work-life balance for affected workers. Under the updated rule, employers who don’t want to pay affected workers for working more than 40 hours a week would need to stop scheduling them for overtime work, effectively ensuring time off from work to handle family responsibilities or engage in other pursuits.
The loss of the rule could also mean fewer jobs. By reducing overwork, raising the overtime threshold could expand employment. Under the rule, employers in some cases would hire new workers to cover the hours that newly overtime-eligible workers had been working without pay, or spread hours to other employees, a major goal of the original FLSA.
West Virginia could take action to expand overtime protections to its workers, and protect the gains that the 2016 rule was supposed to provide by passing legislation raising the state overtime threshold, following the parameters of the U.S. Department of Labor’s 2016 overtime rule. Under current state law, nearly all employers in the state are covered by federal overtime rules. By updating state code to reflect the increased standards of the 2016 rule, West Virginia could improve the work lives of nearly one-third of its workforce and restore the original intention of the FLSA and the overtime rule.