A new plan proposed by President Obama would potentially raise compensation for more than 5 million Americans by changing their employment classification. This proposal would update the Fair Labor Standards Act (FLSA) of the late 1930s, which aimed to protect blue-collar workers from exploitation.
According to the law, hourly workers are entitled to overtime pay for any hours worked more than 40 a week. Salaried employees, however, are ineligible for overtime pay because they earn a higher salary and perform managerial tasks.
To determine which class employees fall into, the FLSA set the salary line at $23,660. Employees making more than that are classified as salaried workers, exempt from overtime pay. Under Obama’s proposed plan, the salary limit would be raised to $50,440, meaning that exempt workers currently making less than the limit must either get a raise or be classified as hourly.
Some employers are against the proposed plan, arguing that the proposal would have a negative effect on businesses and even the employees it’s designed to protect. They argue that lowering some employees to hourly pay will lessen their chances for advancement and put small business owners in a financial bind.
But for many employees, this proposal is a welcome change. Employers can easily use the current law to take advantage of some salaried workers, such as restaurant, store and bank managers, who are not paid for the many extra hours they work. For these workers, a large raise – or time and a half pay for extra hours worked – would mean a huge boost to their standard of living.
If passed, the proposed plan would take effect in 2016. It would have a tremendous impact on South Carolina workers, especially those in the tourism industry, allowing them to be appropriately compensated for the hard work they perform. Though no single proposal can completely end employee exploitation, this change is an encouraging and long overdue improvement for American employees.
SC Unpaid Overtime Lawyer
Do you need to file a wage and hour claim? Federal minimum wage and overtime regulations apply in the state of South Carolina. Labor lawyer Andy Arnold has won verdicts and settlements in lawsuits that were denied their hourly wages and overtime pay. Call 864-242-4800 today to discuss your case.