President Obama plans to use his executive authority to require American businesses to pay millions of employees overtime pay, as part of a populist election-year push by the White House targeting income inequality.
The president will direct the Labor Department on Thursday to revamp regulations governing which types of employees businesses can classify as “executive or professional,” and thus avoid paying overtime.
“Due to years of neglect, one of the linchpins of the middle class, the overtime rules that establish the 40-hour workweek, have been eroded,” a White House official said.
Under current rules, employers must provide overtime to salaried workers making less than $455 per week.
But under the president’s executive order, some fast food shift supervisors or office workers who had been denied overtime pay would now be eligible. Employees would also be required to perform a minimum percentage of “executive work” to qualify for the "white collar" exemption, narrowing a loophole that allowed companies to exempt low-level retail managers from overtime pay.
“We need to fix the system so folks working hard are getting compensated fairly,” Cecilia Muñoz, the director of the White House Domestic Policy Council, told The New York Times, which first reported the move. “That’s why we are jump-starting this effort.”
Read more from The Hill.