More than one million employees could see a fatter paycheck in 2020 as the federal government is overhauling overtime pay requirements for the first time in 15 years.
The Department of Labor’s recent overtime rule changes the salary threshold for overtime pay from $23,660 a year, or $455 a week, to $35,568 per year, or $684 weekly, the Wall Street Journal reported.
This is the first time the figure has changed since 2004, and will affect an estimated 1.3 million workers if they put in more than 40 hours of work per week. They would be paid at one-and-a-half times their hourly rate.
Salaried employees or those in managerial positions will not qualify for the new overtime pay rule.
Not only could this rule benefit newly eligible employees, but it could also benefit employers.
“In this day in age, where we’re really trying to attract talent in such a tight labor market, employers can embrace this change and position it as a positive for their employees,” Erron Stark, vice president of channel sales at ADP, told Fox Business. “If they recognize that benefit, there could be an inherent benefit to their organization as well.”
The Department of Labor rule will take effect on January 1, 2020.