A new study has revealed that American workers are facing underpayment, overwork, and stress due to declining average hourly wages, adjusted for inflation, since the 1970s, while the average number of hours worked has increased. One of the reasons for this is the decrease in overtime pay.
The study by Bisnar Chase found that the average Maryland employee in the private sector worked approximately 3.5 hours of unpaid overtime per week over 2022, significantly higher than the national average of 2.1 hours. This means that Maryland workers are collectively owed $4,402,329,528 in backpay.
Despite laws that protect the right to overtime pay, those earning above $35k per year are often misclassified into exempt positions that do not qualify for overtime. This creates a large pool of free labor for employers to exploit, leading to increased profits, declining real wages, and a widening income gap.
According to the managing partner and trial lawyer of Bisnar Chase, Brian Chase, the recent trend of working from home due to the pandemic has exacerbated the situation, as unpaid overtime has become a widespread and accepted norm.
The study also found that 70% of respondents would opt for the company that guaranteed overtime pay, compared to the company that offered more vacation days, and 96% believe that being remunerated for overtime is ‘a basic human right’. Furthermore, 79% of respondents said if an employer agreed to backdate payments for overtime, they should receive interest on said payments.
The decline in labor standards, including not receiving overtime pay over the years, could be the cause behind the mass quitting of jobs, referred to as “The Great Resignation” by the media. The pandemic resulted in many workers switching jobs in search of improved work-life balance.
