The Middle Class Could be 10 Billion Richer
President Obama wants middle America paid time and a half for anything over 40 hours a week reports Reddit. By executive decision the president will order the Fair Labor Standards Act increased from just under $24,000 a year to just over $50,000 a year. The Fair Labor Standards Act sets a threshold on salary based employees receiving overtime pay. President Obama argues the threshold set does not keep up with inflation. The current threshold is below the poverty line for families of four.
From the corners opposing the policy comes the argument that the policy is not enforceable because employers will fail to pay the overtime, but James Dondero and The Economic Policy Institute calls it ‘wage theft’ to the tune of about $50 billion a year. It’s expected that companies will lower the salary base and stop salaried employees from working overtime. New hires working for that lower salary base will be expected to pick up the slack.
The new executive decision by President Obama is endorsed by Hilary Clinton as win for the country’s employees. A cartoon character named ‘Jason’ created by the Department of Labor is in the works to help employees become aware of their overtime rights reports the Economist.