MADISON (WKOW) -- Federal officials are finalizing details of a new rule to make 4.2 million more salaried workers eligible for overtime. This comes as the U.S. Labor Department reveals findings of an investigation into improper worker compensation in certain industries.
The overtime rule takes effect December 1, doubling the salary threshold that guarantees overtime pay. The Department of Labor wants salaried workers who make less than $47,476 to be paid for overtime hours worked, under the new rule. The previous threshold was $23,660.
Some say it's good news for workers, others say it will harm those workers and their employers.
"Employers have a set amount of dollars currently in their budgets for compensation and if they're being told by the federal government that more money has to go into wages, that doesn't mean that employer or charity organization actually has more money, that has to come from somewhere," says Chris Reader, director of health and human resources policy at Wisconsin Manufacturers & Commerce. "That has to come out of other parts of the compensation package. It's going to mean less in healthcare benefits or something else in the organization. It's going to be less R&D or not as many new hires or not as much investment within the company."
WMC is urging Wisconsin lawmakers in Congress to pass a bill to stop this federal rule and encouraging a smaller increase.
Workers' advocates see this and another action taken by the U.S. Department of Labor to be a positive change in protecting workers' rights.
The Workers' Rights Center of Madison helps employees understand their rights on the job. Director Patrick Hickey says new, federal overtime rules will have a huge impact on at least 180-thousand entry level supervisors or managers in Wisconsin, who are making just over the current salary threshold and doing hours of extra work for nothing.
Plus, this new rule comes just days after labor officials released details of a targeted, random audit of Dane County restaurants and hotels, finding two dozen businesses owed more than $728-thousand in back wages to workers, for various violations. Hickey says it's wage theft and he's happy to see federal officials taking a more active approach in making sure businesses are following labor laws.
"Rather than sit back and wait for workers to come to them to complain, they know the industries where wage theft is common, so they're actually sending their investigators out into the field doing audits at the various businesses and then identifying where there are problems," Hickey tells 27 News. "Some of the employers, it's an honest mistake on their behalf and this is an opportunity for them to correct it and to move forward in a positive direction."
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