Restoring Overtime Pay Act of 2026

Bill Number

H.R. 8868

Origin Chamber

House

Congress

119th Congress, Session 2

Status

Introduced

Latest Action

2026-05-15: Referred to the House Committee on Education and Workforce.

Last Updated

2026-06-02T09:38:28Z

AI-Generated Summary

Purpose

This legislation amends the Fair Labor Standards Act of 1938 to set a minimum salary level required for certain salaried workers to qualify as exempt from federal overtime pay rules. It also updates the duties test for exemption and requires automatic annual adjustments to the salary threshold based on national earnings data.

Key Provisions

• Salary Threshold: Starting three months after enactment, exempt executive, administrative, or professional employees must earn at least $45,000 per year. This rises to $55,000 in 2027, $65,000 in 2028, and $75,000 in 2029. From 2030 onward, the threshold equals the 55th percentile of weekly earnings for full-time salaried workers, as calculated by the Bureau of Labor Statistics.
• Automatic Updates: The threshold adjusts yearly using Bureau of Labor Statistics data from the prior year's second quarter. The Department of Labor may set a higher threshold through standard rulemaking if desired.
• Duties Test Changes: The bill removes a special rule for retail and service businesses. It limits the time exempt employees can spend on non-executive or non-administrative tasks to less than 20 percent of their work time, with the exemption applying only if non-related duties stay below this level.
• Data Publication: The Bureau of Labor Statistics must release quarterly earnings data for full-time salaried workers by region on its public website.
• Effective Date: The changes take effect on the first day of the third month after the bill becomes law.

Significant Changes to Existing Law

• The salary threshold for overtime exemptions, previously set only through Department of Labor regulations, becomes a statutory requirement with built-in yearly increases.
• The duties test for exemption is tightened by lowering the allowable percentage of non-exempt work from 40 percent to 20 percent and applying the rule uniformly across industries.
• Employers can no longer rely solely on regulatory discretion for the salary level; updates now occur automatically without new rulemaking each year.

Potential Impacts

• On Employers: Many businesses may need to pay overtime to salaried workers below the new thresholds or increase salaries to maintain exemptions, raising labor costs especially in lower-wage sectors.
• On Workers: More salaried employees could qualify for overtime pay, potentially increasing earnings for those currently classified as exempt.
• On Government Agencies: The Department of Labor gains clearer statutory authority for enforcement, while the Bureau of Labor Statistics takes on expanded data collection and publication duties.
• No notable effects on international relations are outlined in the legislation.

Main Stakeholders Affected

• Salaried workers in executive, administrative, or professional roles.
• Employers across industries who classify employees as exempt.
• The Department of Labor, responsible for enforcement and possible higher threshold setting.
• The Bureau of Labor Statistics, tasked with data publication and percentile calculations.

Notable Legal, Constitutional, or Political Implications

• The bill codifies salary thresholds into law, limiting future administrative changes and requiring congressional action for major alterations.
• It strengthens overtime protections under the Fair Labor Standards Act without altering the underlying constitutional authority for federal wage regulation.
• The automatic update mechanism reduces the role of notice-and-comment rulemaking for routine adjustments.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Takano, Mark [D-CA-39]

Cosponsors (22)

Rep. Adams, Alma S. [D-NC-12], Del. Norton, Eleanor Holmes [D-DC-At Large], Rep. Tlaib, Rashida [D-MI-12], Rep. Scanlon, Mary Gay [D-PA-5], Rep. Frost, Maxwell [D-FL-10], Rep. Omar, Ilhan [D-MN-5], Rep. DeLauro, Rosa L. [D-CT-3], Rep. Simon, Lateefah [D-CA-12], Rep. Hayes, Jahana [D-CT-5], Rep. Mannion, John W. [D-NY-22], Rep. Ramirez, Delia C. [D-IL-3], Rep. Schakowsky, Janice D. [D-IL-9], Rep. Deluzio, Christopher R. [D-PA-17], Rep. Lee, Summer L. [D-PA-12], Rep. Horsford, Steven [D-NV-4], Rep. Dingell, Debbie [D-MI-6], Rep. Jayapal, Pramila [D-WA-7], Rep. García, Jesús G. "Chuy" [D-IL-4], Rep. Thanedar, Shri [D-MI-13], Rep. McBride, Sarah [D-DE-At Large], Rep. Casar, Greg [D-TX-35], Rep. Evans, Dwight [D-PA-3]

Recent Actions

• 2026-05-15: Referred to the House Committee on Education and Workforce.
• 2026-05-15: Introduced in House
• 2026-05-15: Introduced in House

Bill Versions

• Restoring Overtime Pay Act of 2026 — issued 2026-05-15 — PDF (7 pages)