New overtime rule could affect up to 5 million workers

President Obama on Monday announced new rules that will require businesses to raise the overtime threshold for workers to $50,000 a year, up from the current benchmark of $23,660.
A proposed new rule governing overtime pay will mean bigger paychecks for up to 5 million workers, Obama administration officials said Tuesday.

Business groups and congressional Republicans said the proposal would force employers to reduce overtime hours and perhaps cut the number of workers.

Currently, certain salaried workers who make more than $23,660 cannot claim overtime; the proposed rule would raise that threshold to $50,440 per year for those workers now exempt from overtime benefits.

While many workers already qualify for overtime, some salaried workers who make more than $23,660 a year are exempted because they are designated as management or administrative personnel.

Business groups are poised to fight the expansion of overtime rules, saying they will be forced to cut back on workers' hours or workers, period.

The National Retail Foundation said that "most workers would be unlikely to see an increase in take-home pay, the use of part-time workers could increase, and retailers operating in rural states could see a disproportionate impact."

Obama plans to discuss the new overtime proposal in detail during an event Thursday in Wisconsin.

It could take months to finalize the proposed rule, which is now subject to a 60-day public comment period.

The administration can enact the rule through regulation, though the Republican-run Congress can seek to counter it through legislation.

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