Obama Announces Change In Overtime Rule

President Obama on Monday announced new rules that will require businesses to pay millions of additional American workers overtime wages. The long-awaited regulation would make all salaried workers who earn less than $970 per week, roughly $50,440 per year, automatically eligible if they work more than 40 hours a week. Current cutoff is around $23,660 a year.

"In this country, a hard day's work deserves a fair day's pay," Obama wrote in an op-ed for the Huffington Post. "That's at the heart of what it means to be middle class in America." Obama will tout the proposal during an event Thursday in La Crosse, Wisconsin. The move could raise pay for nearly 5 million workers - or could it?

Under current rules, employees who make more than $455 a week, or $23,660 a year, and work more than 40 hours per week, are considered management and aren't eligible for overtime. (joke) "Right now, too many Americans are working long days for less pay than they deserve," Obama wrote. There will be a public comment period.

A white collar exemption excludes "executive, administrative and professional" employees from receiving overtime. Advocates for changing the rule say the white collar exemption allows employers to avoid paying lower wage workers overtime by classifying them as management.

Business groups, including National Retail Federation, warn that the rule will motivate employers to move their employees from salaried work to hourly work, will reduce workers' hours and will lead to less employees' benefits.