Overtime Hub
Overtime Hub
A one-stop shop for the latest news and resources
This hub page will house the latest resources from the Bell Policy Center and partner organizations, as well as links to studies and articles showing how important overtime modernization is for Coloradans. Here, you’ll find answers to FAQs, printable fact sheets and reports, videos, and shareable social media graphics. Be sure to join the Bell’s email list to receive new information first or add your name to the growing list of Coloradans fighting for an update to our state’s overtime rules.
What is the point of an overtime threshold?
The Fair Labor Standards Act (FLSA), originally passed in 1938, was meant to establish a ceiling on hours worked, a floor on wages earned, and a prohibition on child labor. Specifically, the threshold was used in conjunction with a duties test to differentiate those workers in executive, administrative, and professional roles from those who weren’t. At the time of passage, the FLSA threshold was set at three times the minimum wage. (That would be equivalent to a salary of $74,880 once Colorado’s minimum wage reaches $12/hour in 2020.)
Employees earning less than the threshold were determined unlikely to be executives, administrators, and/or professionals under the law. However, as the wage threshold hasn’t kept up with wage growth and inflation, it no longer serves as a differentiation. An increase would restore what was intended under FLSA.
What is the overtime threshold?
The overtime threshold determines whether employees are excluded from being paid overtime by their employers. If an employee earns more than a certain amount per week, performs executive, administrative, or professional duties, and is paid a salary, then he or she isn’t eligible for overtime pay regardless of hours worked over 40 per week. Currently the overtime pay threshold is $455 per week, which translates to $23,660 per year for a full-time, year-round worker.
Why hasn’t the federal government acted?
The Obama administration undertook a long and detailed process to update the overtime threshold. In May 2016, the Department of Labor announced it would be updated to $913 per week, or $47,476 a year. However, a federal district court in Texas struck down the rule in a controversial decision, so it didn’t go into effect.
The Trump administration has proposed a threshold of $35,308, way short of the intent of FLSA’s original standard. Compared to a proposed 2.5 times the minimum wage standard, the Trump proposal would leave 288,000 Coloradans without overtime protections.
Why should we raise the threshold?
In the 1970s, 62 percent of workers nationally qualified for overtime based on pay. The last time the salary threshold was raised was in 2004, but even by mid-2000s standards, this was a fairly small increase. That year, 15 percent of Colorado workers qualified based on pay. By 2018, that number fell to 7.7 percent, or only 80,000 workers across the state. For workers to be properly compensated for their time and productivity, the overtime threshold must be raised. If the federal government won’t do it, then Colorado can and should act.
How would this work in Colorado?
The Colorado Department of Labor and Education (CDLE) has the ability to update the salary threshold through a regulatory update to the Colorado Minimum Wage Order. In August 2019, the CDLE received comments requesting changes to the Wage Order. Based upon these comments, CDLE can propose a formal change to the Wage Order. Please check back for updates on the process, as it will be important for CDLE to hear from you during this formal process.
Have other states done this?
Washington State is doing precisely what Colorado should do: benchmarking its threshold to 2.5 times the state’s minimum wage. In Washington, that will translate into a threshold of $80,000 by 2026. Massachusetts is working on a similar rule to the proposal in Colorado — the 40th percentile of earnings for full-time salaried workers in their census region. The Massachusetts threshold would equal $61,204 in the census region and is projected to be $68,744 by 2026.
In early 2018, the governor of Pennsylvania moved forward with an increase for the state’s overtime salary threshold. Over the course of the next four years, the salary threshold will increase gradually from $31,720 in 2020 to $47,892 in 2022. California is also slowly increasing its salary threshold from $45,760 in 2018 to $62,400 in 2022.
What types of industries & people would be most impacted by raising the threshold?
If Colorado moves to a salary threshold of 2.5 times the minimum wage, more than 393,000 Coloradans would newly benefit from overtime protections. That’s more than 60,000 fathers and 55,000 mothers who would have additional time to spend with their families.
While workers of every age would be affected, those aged 16-39 would represent more than half of the new workers covered. According to data from the Economic Policy Institute, workers of all occupations, industries, and races would see increases, and for the most part, it would be in relatively equal ways.
Just as interestingly, college-educated workers would see benefits from the increased salary threshold, but those without a college degree would see the most value from being able to accrue overtime.
Are you working for free?
Are you a salaried worker who’s classified as exempt from overtime? Take this quick quiz from Towards Justice to find out when you’ve already put in full-time hours this year — the day you start working for free.
What Others Are Saying
See what other organizations and individuals across the state are saying about updating Colorado’s overtime rules. You can read the Bell’s comments to CDLE here.
