NJPP REPORT: Valuing Our Time: Strengthening New Jersey’s Overtime Law
For Immediate Release
TRENTON, NJ (October 24, 2019) – Hundreds of thousands of New Jersey workers are not covered by overtime protections and risk being exploited, according to a new report by New Jersey Policy Perspective (NJPP). This is a direct result of federal overtime laws that have eroded over time and the lack of a strong state overtime law.
“Workers deserve to be fairly compensated for all of the hours they work,” said Nicole Rodriguez, report author and Research Director at NJPP. “Without the right to overtime pay, workers are sacrificing not only their economic security, but their already scarce personal time. The current overtime salary threshold falls incredibly short of protecting moderately paid workers and their families. New Jersey lawmakers can fix that by restoring the overtime salary threshold to its historical standard.”
The report, Valuing Our Time: Strengthening New Jersey’s Overtime Law, finds that only 6.8 percent of full-time salaried workers are guaranteed overtime pay nationally, down from 62.8 percent in 1975. Overtime protections have eroded over time as the salary threshold was rarely updated over the last forty years or indexed to account for increases in the cost of living.
From the 1940s through the late 1970s, the federal overtime salary threshold remained above 2.5 times the minimum wage in all but two years. Today, the threshold is $23,660 per year, and it is scheduled to increase to $35,568 in 2020 due to a new rule by the Trump administration.
The NJPP report recommends New Jersey implement its own overtime salary threshold at 2.5 times the minimum wage, or $52,000 per year at the current $10 minimum wage and $78,600 in 2024 when the $15 minimum wage takes effect. Washington, New York, California, Pennsylvania, and Michigan have already announced or taken steps to increase their state overtime threshold.
Make the Road New Jersey, a membership based organization that advocates for worker and immigrant rights, has launched a petition to urge the Governor and state Department of Labor to increase the overtime threshold for New Jersey workers.
“Fighting to increase the overtime threshold is important for New Jersey workers because we deserve to be paid for the extra time we work, whether we are working 45, 50 or 70 hours a week,” said Andrea Rodriguez, a member of Make the Road New Jersey. “As an assistant manager at a fast food restaurant, I work overtime but under Trump’s rule, I won’t be eligible for overtime pay. It’s time for New Jersey to stand up and act.”
If New Jersey enacts a state overtime salary threshold at 2.5 times the minimum wage, 842,000 workers would gain overtime protections by 2024, including 315,000 workers who would gain the right to overtime pay for the first time. This overtime threshold would benefit a diverse group of workers, as 42 percent are Black, Latinx, and Asian.
Raising the overtime salary threshold will benefit workers, their families, and the broader economy—including businesses—according to the report.
“Under a higher threshold, workers will likely experience a boost in take home pay, strengthening their consumer power,” added Rodriguez. “This is a proven way to grow an economy from the bottom up, as workers will have more to spend locally at businesses small and large.”
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