The Department of Labor has proposed overhauling the rules that govern which employees can receive overtime pay. The rules being considered have significant implications for the marcomms industry because they nearly double the overtime pay eligibility cutoff for salaried employees from $23,660 to $50,440. This means any employees on salary making less than $50,440 — including most entry-level workers — will be eligible for overtime pay. According to some estimates, one in five workers in the U.S. advertising industry make less than the cutoff, setting them up for a significant raise if they work long hours.
Agencies have a few options. They could raise some employees' base salaries above $50,440, bumping them out of overtime eligibility. Agencies could also lower some base salaries to make up for the cost of paying more workers overtime. Cutting some jobs is another option.
How do you think agencies will respond to the new overtime rules?