SACRAMENTO, Calif. (WOMENSENEWS)–President Barack Obama announced in an oped recently that he intends for more than 5 million American salaried workers to become eligible for overtime pay. The increase is designed to lift workers from poverty to the middle class by raising the threshold for time-and-a-half overtime pay to $50,440 from $23,600 per year.
The last increase was more than a decade ago, in 2004, under President George W. Bush. The White House can issue this regulation without congressional approval. This threshold will affect managers, many of whom work at fast food chains and retail stores.
Fifty four percent of those who will benefit from the higher threshold are women. Many are supporting children on their own. This possibility for overtime pay can mean the difference between paying the bills on time, and not paying the bills at all.
The threshold change is bound to be particularly helpful for women of color, given their higher rates of poverty. In 2013, 32 percent of white single mothers were living in poverty, compared to 46 percent of African American single mothers and 47 percent of Latina single mothers.
For women, marriage offers major financial security. Only 5 percent of white married mothers and 12 percent of African American mothers lived in poverty.
In 2013 black women made up 33 percent of service jobs in this country, according to the Department of Labor statistics. Another 30 percent worked in sales and office positions.
On average, front-line supervisors in an office earn $824 per week. Secretaries and those in administration earn an average of $2,113.
With overtime pay, the monthly wages of an office supervisor could increase to $2,905.80. That total is based on an additional 10 hours per week at $19.82, for a total of $792.80 monthly.
New Shoes, Dinner Out
For a working mother and her family this pay increase could mean anything from moving to a larger home, buying new shoes for a child or enjoying a family dinner at a fast food restaurant once a month.
Employers, of course, may oppose the whole idea. Some may respond to the higher thresholds by downsizing staff or offloading overtime to workers earning below the threshold.
I hope, instead, that many will embrace the president’s proposal and see how much their businesses have to gain from healthier, happier and more productive employees.
For many women, the combination of working overtime without overtime pay can cause major work-life stress, researchers have found.
A study conducted by Health Advocate, Inc., found for an employer, the difference between employees suffering work-family conflict and those who don’t is about 25 percent less turnover.
It can also mean a cashier who smiles at customers instead of scaring them away with stony stares. Employers should see the big value in that.
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