WASHINGTON (AP) - They're called managers, and they sometimes work grueling schedules at fast food chains and retail stores. But with no overtime eligibility, their pay may be lower per hour than many workers they supervise.
With those employees in mind, the Obama administration is proposing making up to 5 million more people eligible for overtime - its latest effort to boost pay for lower-income workers. These workers would benefit from rules requiring businesses to pay eligible employees 1½ times their regular pay for any work beyond 40 hours a week.
"We've got to keep making sure hard work is rewarded," President Barack Obama wrote in an op-ed published Monday in The Huffington Post.
"That's how America should do business. In this country, a hard day's work deserves a fair day's pay."
Employers can now often get around the rules: Any salaried employee who's paid more than $455 a week - or $23,660 a year - can be called a "manager," given limited supervisory duties and made ineligible for overtime.
Yet that would put a family of four in poverty. Obama says that the level is too low and undercuts the intent of the overtime law. The threshold was last updated in 2004 and has been eroded by inflation.
The long-awaited overtime rule from the Labor Department would more than double the threshold at which employers can avoid paying overtime, to $970 a week by next year. That would mean salaried employees earning less than $50,440 a year would be assured overtime if they work more than 40 hours per week.
Labor Secretary Tom Perez said Tuesday that the change would add $1.2 billion to $1.3 billion in wages for many newly overtime-eligible workers. Others, Perez said, will benefit from having additional hours. At the same time, he said, some employers may choose to hire new full-time or part-time workers to conduct the work salaried workers had once performed.
To keep up with future inflation and wage growth, the proposal will peg the salary threshold at the 40th percentile of income. The White House said 56 percent of those who would benefit in the first year are women, and 53 percent have a college degree.
With the higher threshold, many more Americans - from fast-food and retail supervisors to bank branch managers and insurance claims adjusters - would become eligible for overtime.
A threshold of $984 a week would affect 15 million people, according to the liberal Economic Policy Institute. In 1975, overtime rules covered 65 percent of salaried workers. Today, it's just 8 percent, the White House says.
The beneficiaries would be people like Brittany Swa, 30, a former manager of a Chipotle restaurant in Denver.
As a management trainee, she started as an entry-level crew member in March 2010. After several months she began working as an "apprentice," which required a minimum 50-hour work week.
Yet her duties changed little. She had a key to the shop and could make bank deposits, but otherwise spent nearly all her time preparing orders and working the cash register. She frequently worked 60 hours a week but didn't get overtime because she earned $36,000.
The grueling hours continued after she was promoted to store manager in October 2010. She left two years later and now processes workers' compensation claims at Travelers. She makes $60,000 a year, "which is surprising, since I only work 40 hours a week," she says.
Swa has joined a class-action lawsuit against Chipotle, which charges that apprentices shouldn't be classified as managers exempt from overtime. A spokesman for Chipotle declined to comment on the case.