Franchise News
U.S. Labor Department Moves to Introduce a New Overtime Threshold
Current wage data and projections of purchasing power could translate to a higher baseline income to legally qualify for overtime pay.
The U.S. Labor Department has announced plans to update overtime thresholds for hourly employees, “raising the minimum salary for employees to qualify for Fair Labor Standards Act white-collar exemptions to $35,308 per year,” according to an article in Restaurant Hospitality.
Under current law, employees whose annual salary comes to less than $23,660 annually, or who earn $455 a week or less, are eligible for “overtime based on their job duties,” the article said.
“The Labor Department’s new proposal would update the salary threshold using current wage data, projected to Jan. 1, 2020, and boost the standard salary level to $679 a week (or $35,308 per year). The department said the plan “would make more than a million more American workers eligible for overtime,” the article said.
This could significantly affect franchisors across segments, as many employees at franchise locations work on an hourly income.
According to the article, Matt Haller, the IFA’s senior Vice President of Government Relations and Public Policy, said in a statement, “The IFA commends the Department of Labor for issuing a sensible approach to expand overtime eligibility.”
Read the full article here.
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About the Author
Katie LaTour
FollowKatie LaTour is a staff writer for 1851 Franchise and Estatenvy. She has experience in copywriting, editing and translation, and has written content for brands including Coca-Cola, Ivivva and Ray Ban's. She holds a Master of Arts in Writing and Publishing from DePaul University and a B.A. in English and Spanish from the University of Dayton. Presently, Katie is working on a poetry collection and building a platform for Chicago creative professionals to share best practices.
