Pennsylvania Governor directs overhaul of state overtime rules

Pennsylvania Governor Tom Wolf has announced a proposal that is intended to strengthen the middle class by modernizing the state’s outdated overtime rules, a move expected to increase the pay of nearly half a million people. Because the overtime rules have not been updated, employees in the state are covered by an exemption to overtime that was intended for high-wage, white-collar employees more than 40 years ago.
Under the outdated exemption, a salaried worker earning up to $24,000 a year, which is below the poverty line for a family of four, can work 40, 50, 60 or more hours a week and is not guaranteed overtime at time-and-a-half, the governor’s office noted in a release.

Phased in threshold increases

As directed by Wolf, the Department of Labor & Industry is finalizing a plan to modernize rules and clarify requirements. The new rules will be phased in over four years to increase the salary threshold that requires employers to pay overtime to most salaried workers:

  • On January 1, 2020, the salary level to determine overtime eligibility for most workers will be raised from the federal minimum of $455 per week, $23,660 annually, to $610 per week, $31,720 annually;
  • On January 1, 2021, the threshold will increase to $39,832;
  • On January 1, 2022, the threshold will increase to $47,892;
  • Starting in 2022, the salary threshold will update automatically every three years so that workers are not left behind.

The duties for executive, administrative, and professional workers will also be clarified to make it easier for employers to know if a worker qualifies for overtime.
The Department of Labor & Industry anticipates releasing the proposal to update the regulations for public comments in March. (Pennsylvania Office of the Governor, https://www.governor.pa.gov/newsroom/, January 17, 2018).

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