Gov. Gretchen Whitmer announced today that she will upgrade overtime wages for Michigan workers, in defiance of a federal limit by President Trump that would block time-and-a-half pay for nearly 3 million workers.
Last month. the Trump administration won a long battle in the courts and cut back on a President Obama executive order that would have established a federal OT mandate for nearly all salaried workers earning roughly $47,000 or less. The Trump rule says that salaried workers earning $35,568 or less qualify for overtime pay for work beyond 40 hours a week.
Trump’s watered-down version calls for a rule that, compared to the long-pending limit, will benefit 1.3 million workers, as opposed to 2.8 million who will lose out.
Whitmer has not proposed a salary number yet, but the Michigan labor department will establish a new level that reflects decades of inflation rates that have downgraded workers’ income. The governor estimates that 200,000 Michigan workers would benefit from an OT rule that exceeds the mandate established by the White House.
“This is certainly something that’s going to help people in the middle class,” Whitmer told the Huffington Post. “It’s something that will help more people get into the middle class. It’s an acknowledgment that these are hardworking people who are working more than 40 hours a week. It’s the right thing to do.”
The federal government initially imposed mandatory overtime pay for low-income salaried workers as a method of ending the “sweat shop” working conditions of past decades when some workers logged 70 or 80 hours on the job.
Four decades ago, 60 percent of the workforce qualified for time-and-a-half wages. By 2016, OT pay was protected for only about 7 percent. If the 1975 federal requirement had kept pace with the rate of inflation, the current level for qualifying for OT would exceed $55,000 in income.
In addition, the new mandate set forward by the Trump Labor Department blocks annual adjustments that would allow low-level salaried workers to keep up with the cost of living. That is the same tactic used back in 1975, when President Gerald Ford expanded the income-eligibility for overtime but never applied a COLA increase.