Valuing Our Time: Strengthening New Jersey’s Overtime Law

Source: Nicole Rodriguez, New Jersey Policy Perspective, October 24, 2019

From the introduction:
A prosperous New Jersey depends on the livelihood of all our workers. In fact, the state economy benefits most when workers are able to earn fair pay for all the hours they work while balancing employment responsibilities with family obligations. However, millions of people across the nation, including hundreds of thousands in New Jersey, are not covered by overtime protections and risk being exploited for their time. This is a direct result of federal overtime laws that have eroded over time—and the lack of a strong state overtime law—where far too many workers are exempt from the right to earn time-and-a-half when they work over 40 hours a week.

Currently, some salaried white-collar workers who earn more than $23,660 a year can be legally denied overtime pay. These exempted workers (1) are considered “highly compensated,” earning at least $455 per week ($23,660 per year), (2) have primary office or non-manual duties, and (3) pass the “duties test,” a complicated test of employees’ tasks and responsibilities that establish them as a bona fide executive, manager, or highly trained professional. The federal overtime salary threshold for these exempted workers will increase to $35,568 in 2020, but this still falls significantly short of historical standards.

Most salaried workers are not covered by federal overtime law. Share of full-time workforce who ear less than the federal overtime threshold: 1975 - 62.8%, 2016 - 6.8%. Source: EPI analysis of Current Population Survey Outgoing Rotation Group microdata.