The United States Department of Labor has proposed raising the threshold that certain employees must earn before they can qualify for an exemption from mandatory overtime.
Whether an employee is exempt or not is a huge question both for employees and employers in the Denver area. The advantage to employers is that they may require, or effectively require, an exempt employee to work well over a 40-hour week without paying a dime of overtime compensation.
This is because, in theory, the salaried employee gets paid to fill a given role, no matter how much or little time they need to fulfill it. While the advantage to an employee is supposed to be a higher salary and not being a slave to a time clock, oftentimes, exempt employees get paid so little relative to the time they work that they are effectively working at minimum wage or less.
This new proposal would raise the threshold from $23,660, where it sits now, to $35,308.
For affected employees, their employers will have the choice of paying overtime as required, reducing the employees’ hours or offering them a higher salary such that they are earning $35,308. In any instance, this proposal would be a boon to some Colorado employees.
Still, others are criticizing the proposal because it does far less than what the prior Administration had proposed. Had the previous Administration had its way, the minimum threshold would have been $47,476 as a start.
Employees in Colorado should watch this proposal carefully for further developments. If it becomes the rule of the land, it could mean that their employers owe them either more money or more time away from work. Employers who chose to ignore overtime laws at either the federal or state levels may be held responsible via a wage and hour claim.