As a manager for a national auto supply chain, Lora McCrary puts in between 50 and 70 hours a week remodeling stores across the country.
But because she’s a salaried employee, she’s ineligible to earn overtime pay. The long hours, weeks spent on the road and living out of hotels has taken a toll on her emotionally and physically.
“I’m just so beat down,” McCrary, 50, said from a job site in South Florida. “I’m 100 pounds heavier than I was when I started the job.”
So when she heard last week’s news that President Obama wants to expand the overtime rules so that more Americans are eligible, she was excited.
“Right now, too many Americans are working long days for less pay than they deserve,” Obama wrote in an op-ed for The Huffington Post. “That’s partly because we’ve failed to update overtime regulations for years.”
The overtime threshold was last raised in 1975. According to the Department of Labor, 62 percent of workers qualified for overtime back then. Now, just 8 percent do. In fact, a family of four would have to live in poverty before a breadwinner would qualify for overtime—the poverty threshold for a family of four is $24,008, but the overtime threshold is just $23,660.
“The rules that establish which workers are exempt from overtime pay haven’t kept up with the cost of living,” reads a Department of Labor webpage. Under the new proposal, the federal government would lift the overtime threshold from $23,660 to $50,440.
With a salary of just over $40,000, McCrary is one of the 5 million working Americans who would benefit from the new rule. She stands to earn up to $15,000 more annually, and doesn’t hesitate when asked what she’d do with the extra income: “I would put that money in savings for old age. I have to start to put something away to fall back on, because I don’t want to have to fall back on my kids,” she said.
McCrary’s current job offers stock options and a 401K retirement plan and she’s taken advantage of those benefits for the past two years.
But before this job, she had only one employer that offered a retirement plan and it cashed out the employee retirement accounts when the business folded.
She knows what it’s like to juggle to make ends meet. A single mother of five who are all adults now, she’s worked as many as three jobs—driving a limo, working at a hotel, and doing census surveys.
Like many parents, McCrary put her children’s future ahead of her own. That included helping them pay for college. But it sapped her efforts to save for herself.
“My daughter took out student loans that we didn’t realize were parent loans,” she said. “I’m on default on those and they grow every year.”
A $25,000 loan has ballooned into a debt of more than $40,000, she said.
“Trying to keep my kids in school and get them educated was more important than trying to put something away for myself,” McCrary said. “I figured the worst case scenario, I could live in one of their basements.”
Nationwide, a movement has swelled that is calling attention to the struggles of fast-food and retail employees, car washers, home care professionals and others who make a minimum wage.
The Obama Administration’s proposed rule targets a specific set of employees – white-collar employees, managers and supervisors who are often full-time and salaried. Currently, if these workers put in more than 40 hours a week, it does not translate into more money in their paychecks.
“Many working families are putting in longer hours, but are not seeing their extra work reflected in their wages because they are currently not eligible to receive overtime,” said Deepak Bhargava, executive director of the Center for Community Change. “Being able to receive overtime will greatly level the wage playing field that is greatly tipped in favor of the wealthy in our country.”
The proposal could take months to implement. It is subject to a 60-day public comment period. The administration can put the rule into effect through regulation. However, the conservative-led Congress can try to fight it with legislation.
Adjusting public policy to keep up with the times is long overdue, said McCrary, who has noticed that some supervisors seem reluctant to ask to be paid for all of the hours that they work.
“Some of the people have been out here for so long, they don’t even argue about it. This is the way it’s always been,” she said. “It is time for a change.”