Overtime Rule

Overtime Rule

Governor Whitmer has directed the Department of Labor and Economic Opportunity to submit a request for rulemaking to raise the threshold for Michigan workers who are salaried and eligible for overtime compensation. 

The new overtime rule issued by LEO will ensure that Michiganders are paid fairly for the hours they work and will begin closing the gap in pay equity.

The rule covers middle managers, administrative staff and skilled professionals like graphic artists or programmers, who stand to earn more than the Trump administration’s income threshold (about $35,000) and less than the Michigan threshold. There are 4.4M workers in the State of Michigan. Of these 4.4M workers, 2.9M (about two-thirds) are hourly workers and are already entitled to overtime pay. 1.5M workers are salaried.

LEO has two main reasons for raising the overtime threshold:

  1. LEO exists to expand economic opportunity and prosperity for all. Even in a resurgent Michigan economy, income growth has not been widely shared. Unpaid overtime crowds out time that could otherwise be spent on paid work or family responsibilities.
  2. Time worked is time paid. 63% of Michiganders were covered in 1975, but that has dwindled to 5% today. 

Eligible employees that receive overtime protections are not required to work overtime and employers may cap hours at 40 hours. Many eligible employees that will receive new protections likely are not working overtime today.

LEO is committed to an inclusive, data-driven rulemaking process that results in a better deal for Michigan workers and their families.