Nearly 250,000 Indiana Workers Expected to be Affected by New Overtime Law

Recent legislation by the Obama administration updated the rules on federal overtime. There are two kinds of workers, those who work on salary and those who are employed by the hour.

Technically, salaried positions are 40 hours a week, but many employees put in far more time than that. The idea behind a salary is that employees are guaranteed a certain income and do not need to be concerned about getting less because their employer has already committed to paying them that amount for their time. Their employers also have had the freedom to ask for extra effort when employees make more than the minimum salary.

Until recently that minimum was just $23,660.

The new legislation upped that limit - last set in the 1970s - to $47,476, more than double the old amount.

What Higher Salary Limits Mean for Indiana Workers

With such a big increase, the law will affect a lot of workers, nearly 250,000 in Indiana alone. This means those with salaries less than the new threshold would need to be paid overtime for any hours worked past 40, or other employees would need to be brought it to pick up the slack. Either way, existing salary workers who were making less than the new minimum would make just as much money and have more time to spend with their families, or they would continue to work more than 40 hours a week, but make more money.

Concerns of the Impact on Businesses

While all this sounds like a great situation for employees, there are concerns about how such a hike might affect business as a whole. It's expected that businesses will hire more part time workers in order to avoid paying the extra overtime and that these workers might not get a true grasp of the tasks they are assigned. It also means that those who may have been due for a promotion to middle management may not get it. Instead, they may be asked to do management level work at their old hourly wage.

Learn More about Employment Law

Like any new law, not everyone has a full understanding of what is required right away. Nor do they fully grasp what their rights are. This may potentially lead to salaried workers being asked to work overtime hours without overtime pay. Under the new law, these workers are entitled to this extra income - even if it means receiving back pay.

If you've worked more hours than you have been paid for in Indiana, the Employment Law Office of John H. Haskin & Associates in Indianapolis may be able to help you get back the money that you're due.

Contact us to arrange a free consultation.