The bill amends Section 28-12-4.3 of the General Laws in Chapter 28-12, titled "Minimum Wages," to introduce new exemptions and modify existing ones regarding overtime pay for salaried employees. It specifies that employees in bona fide executive, administrative, or professional capacities will be exempt from overtime pay unless their salaries fall below certain thresholds based on the minimum wage. The bill establishes a phased approach for these thresholds, with different multipliers for small employers (1-50 employees) and large employers (more than 50 employees) over the next several years.

Specifically, through December 31, 2025, employees in these capacities will remain exempt unless their wages, if computed on an hourly basis, would violate the applicable minimum wage law. Commencing January 1, 2026, small employers must pay overtime if salaries are less than one and one-half times the minimum wage, while large employers must pay if salaries are less than two times the minimum wage.

Further, starting January 1, 2027, the threshold for small employers will increase to two times the minimum wage, and for large employers, it will increase to two and one-half times the minimum wage. Additionally, beginning January 1, 2028, the threshold for small employers will remain at two and one-half times the minimum wage.

The bill removes previous language that exempted certain salaried employees from overtime pay based solely on their executive, administrative, or professional status. It also clarifies that employees who are entitled to overtime pay under federal law are not exempted by this section. The changes aim to expand overtime eligibility for more employees, thereby enhancing labor protections and ensuring fair compensation for work performed beyond standard hours. The act will take effect upon passage.

Statutes affected:
5678: 28-12-4.3