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 in executive, administrative, or professional capacities. The bill specifies that employees of summer camps, police officers, and certain state employees can opt for compensatory time off instead of overtime pay.

It establishes a phased approach to overtime eligibility for salaried employees based on the size of the employer and the employee's salary relative to the minimum wage. Specifically, it introduces different salary thresholds for small employers (1-50 employees) and large employers (more than 50 employees) that will determine overtime eligibility starting from 2026.

Key changes include the deletion of previous exemptions for salaried employees earning a minimum of $200 per week and the introduction of new criteria that will require employers to pay overtime to employees whose salaries fall below specified multipliers of the minimum wage. For instance, from January 1, 2026, through December 31, 2026, small employers must pay overtime if salaries are less than one and one-half times the minimum wage, while large employers must do so if salaries are less than two times the minimum wage.

Additionally, from January 1, 2027, small employers will be required to pay overtime if salaries are less than two times the minimum wage, and large employers will be required to do so if salaries are less than two and one-half times the minimum wage. The bill aims to expand overtime protections for more employees and will take effect upon passage.

Statutes affected:
5678: 28-12-4.3