Pennsylvania Salaried Workers to Earn More for Overtime

Salaried Pennsylvania workers have cause to celebrate following a favorable ruling on overtime compensation by the Pennsylvania Supreme Court. In Chevalier v. General Nutrition Centers, the Supreme Court ruled that employers must pay their salaried employees an additional 150%—as opposed to an additional 50%—of their regular rate for every hour worked over 40 in a given week. The 50% mandated by the federal Fair Labor Standards Act (FLSA), it was ruled, violated Pennsylvania’s Minimum Wage Act (PMWA). What does this mean for PA Salaried Workers? The landmark ruling effectively increases earnings for overtime, by changing how a salaried employee’s “overtime” pay is calculated. The Dispute The basis of the dispute was Section 231.41 of the Pennsylvania Department of Labor and Industry’s regulations, which states: “Each employee shall be paid for overtime not less than one and a half times the employee’s regular rate of pay for all hours in excess of 40 hours in a workweek.” This clause was being interpreted differently by the opposing sides, given the methods used to calculate salaried employees’ “regular rate” and “overtime.” How regular rate was calculated was not at issue for this Court but the Court noted it may be an issue at a later date. The