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Pennsylvania

Wolf proposes controversial overhaul of Pennsylvania's overtime rules

Natasha Lindstrom
| Wednesday, Jan. 17, 2018, 5:42 p.m.
Gov. Tom Wolf announced plans to change the state's overtime rules for the first time in four decades during an event at The Fresh Grocer of Grays Ferry in Philadelphia, where the Democratic governor (right) was joined by legislators, store management and local workers on Wednesday, Jan. 17, 2018.
State of Pennsylvania
Gov. Tom Wolf announced plans to change the state's overtime rules for the first time in four decades during an event at The Fresh Grocer of Grays Ferry in Philadelphia, where the Democratic governor (right) was joined by legislators, store management and local workers on Wednesday, Jan. 17, 2018.
Gov. Tom Wolf
State of Pennsylvania
Gov. Tom Wolf

Gov. Tom Wolf on Wednesday called for a sweeping overhaul of Pennsylvania's overtime rules that he says could lead to higher wages for an estimated 460,000 low- to middle-income workers — or more than 7 percent of the state's workforce.

Wolf's regulatory proposal, which he wants to phase in over four years, would raise the minimum salary level to be eligible for overtime, or getting time-and-a-half pay for time worked over 40 hours in a week. The plan would raise the minimum amount employees must make to get overtime from the federal threshold of $23,660 annually to $47,892 by 2022.

The governor lamented that under current rules, a salaried worker earning up to $24,000 a year can work 60 hours a week and not get paid any overtime.

"It's simple: If you work overtime, then you should get paid fairly for it," Wolf said as he announced the plan at a Philadelphia grocery store before a group of lawmakers, municipal officials, store management and workers. "This important step will put more money into the pockets of hardworking people and will help expand the middle class in Pennsylvania."

Wolf's overtime "modernization" proposal, first reported by the Associated Press, follows the Democratic governor's failed attempts to persuade the GOP-controlled General Assembly to pass a law raising the minimum wage.

The proposal drew praise from worker advocates and Democratic state and local officials such as Allegheny County Executive Rich Fitzgerald.

“I thank the governor for ensuring that these employees can continue to support their families and gain economic security," Fitzgerald said in a statement. "We know that the confidence in their own earning power will result in money being spent in their local communities which benefits us all."

Some business leaders were less pleased.

The Pennsylvania Chamber of Business and Industry warned that Wolf's move to make hundreds of thousands of additional salaried employees eligible for overtime pay could actually result in employers cutting back hours and pay.

The organization's president and CEO, Gene Barr, told the Associated Press that it'll increase the cost of doing business, make workplace schedules less flexible and potentially reduce pay for former salary workers.

Wolf argued that raising the overtime threshold would strengthen the middle class, boost the economy and help make wages fairer. He lamented that existing rules established in 1977 are outdated and have not kept up with inflation.

"Four decades is far too long for Pennsylvania's overtime regulations to remain stagnant," acting Labor and Industry Secretary Jerry Oleksiak said. "Updating the overtime rules to keep pace with our 21st century economy is the right thing to do for the hard-working men and women of the commonwealth."

Wolf's regulatory proposal needs approval from a five-member agency board that has a 3-2 Democratic majority. The process could take more than a year.

Several other states require overtime pay for salaried workers above the federal baseline, including California and New York.

The Associated Press contributed.

Natasha Lindstrom is a Tribune-Review staff writer. Reach her at 412-380-8514, nlindstrom@tribweb.com or on Twitter @NewsNatasha.

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