WASHINGTON -- Saying it’s “just fair” for more Americans to earn overtime pay, President Obama on Thursday directed the Labor Department to come up with new rules to expand the number of workers eligible.
Before sitting down to sign a presidential memorandum to “modernize” work rules, Obama told a crowd gathered at the White House that the current standards are no longer adequate.
Many workers in the U.S. earn roughly an hourly wage but don’t qualify for overtime because they’re designated as management. In some cases, they don’t do much supervising, White House economists say.
“It doesn’t make sense that this allows salaried workers to be paid less than the minimum wage,” Obama said.
“Overtime’s a pretty simple idea,” he said. “If you have to work more, you should get paid more.”
The memorandum is the latest part of Obama’s administrative plan to raise worker pay on his own authority and without action by lawmakers. Already this year he has ordered federal contractors to pay workers $10.10 an hour, the minimum wage that he thinks should be extended to the whole country. It’s an idea unlikely to pass Congress.
The rule changes ordered Thursday don’t require action by Congress. The Department of Labor can enact regulations raising the salary threshold for overtime eligibility, which White House aides say has not kept up with inflation.
The agency could also redefine the meaning of “supervisory duties” to ensure more workers qualify for overtime pay.
Business leaders are worried that a wage hike could reduce the profits of employers, especially small business owners, and that some could be forced out of business or into more conservative decisions about how many people they can hire.
With workers and business owners standing around him in the East Room, Obama said he was using his pen to “give more Americans the chance to earn the overtime pay they deserve.”
He singled out a woman standing behind him, an employee at a Pennsylvania oil refinery, who he said has raised four children as a single mom in part because of the overtime pay she earns.
When parents like her have to arrange for a babysitter or change family arrangements to pick up more work, he said, her employer realizes “that puts a strain on her family.”
Paying her more is “just fair,” he said. “It’s the right thing to do.”