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Department of Labor Finalizes New Overtime Rules!

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The U.S. Department of Labor just released new rules earlier this week changing the way overtime pay will affect up to 12.5 million workers. The new rules deal with the Fair Labor Standards Act (FLSA), a law originally passed by FDR in 1938 as part of the New Deal and amended in 1949 to include overtime protections. FLSA sets minimum wage standards and also provides that employees who work more than 40 hours in a workweek must be paid 1.5 times their hourly rate (“time and a half”). However, some workers are exempt from the law, such as salaried professionals, administrative workers, and executives earning at least $455 per week. This week’s new rule raises that weekly amount to $913.

The old rule disproportionately harmed female workers and people of color, and disproportionately affected workers in the South, according to data from the Economic Policy Institute. For example, Hispanic workers make up 16.0 percent of those who will directly benefit from the new rule, even though they only represent 11.8 percent of the salaried workforce. Women of color and single mothers similarly disproportionately directly benefit from the rule change.

This is not surprising given the history of our country’s labor laws excluding people of color, particularly women of color. As Caroline Frederickson has noted, the New Deal was actually a “raw deal” for women and minorities. The National Labor Relations Act and the Fair Labor Standards Act, as passed in the 1930s, excluded farm workers and domestic workers from coverage, two industries predominated by people of color.

We applaud the Department of Labor for making this important update, which represents a huge win in the fight for equal opportunity and closing the gender pay gap.

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