More work, more pay? New rule extends overtime to millions

COLUMBUS, Ohio (AP) — More than 4 million U.S. workers will become newly eligible for overtime pay under rules issued Wednesday by the Obama administration.

In the fast-food and retail industries in particular, many employees are deemed managers, work long hours but are paid a flat salary that barely exceeds the income of the hourly workers they supervise who receive overtime pay.

Business groups, however, argued that the changes will increase paperwork and scheduling burdens for small companies and force many businesses to convert salaried workers to hourly ones to more closely track working time.

"With the stroke of a pen, the Labor Department is demoting millions of workers," David French, a senior vice president for the National Retail Federation, said.

Workers making more than $47,500 may still be eligible for overtime pay, unless they perform management, supervisory or professional functions — the so-called "white collar" duties test.

The liberal Economic Policy Institute estimates that 4.9 million people will become newly eligible for overtime, slightly more than the government's figure, and that an additional 7.6 million will benefit because they have previously been denied overtime pay as white collar workers.

Despite their titles, they have complained in lawsuits against such chains as Chipotle and Dollar General that they spend most of 50- or 60-hour workweeks staffing cash registers, mopping floors, or performing other tasks typical of regular employees.

An hourly worker "who takes an afternoon off to attend a parent-teacher conference will not be paid for that time, but an employee (who is exempt from overtime) will be paid her full guaranteed salary," McCutchen said in congressional testimony last week.