Bill Sponsors
Potter, Bennett, Read, Shanley, Edwards, Messier, Furtado, and Giraldo
Committee
House Labor
Summary
Select
This legislation updates the salary requirements for employees to be considered exempt from overtime pay. Currently, certain executive, administrative, and professional employees are exempt if they earn relatively low weekly amounts. This bill replaces that fixed amount with a rising threshold based on the state minimum wage. Starting in 2027, the salary required to be exempt from overtime increases incrementally to 1.5, 2, and eventually 2.5 times the minimum wage. The timeline for these increases is slower for employers with 50 or fewer employees compared to larger employers.
Sponsor
Analysis
Pros for Progressives
- Significantly reduces the exploitation of lower-wage workers who are misclassified as "managers" to avoid paying them overtime for excessive hours.
- Raises the standard of living for salaried employees by linking the overtime exemption threshold directly to the minimum wage, ensuring it keeps pace with economic baselines.
- Ensures that workers who put in extra hours are fairly compensated, either through higher base salaries or mandatory overtime pay, promoting economic justice.
Cons for Progressives
- Delays significant implementation until 2027, leaving many workers vulnerable to current low-threshold exemption rules for several more years.
- Creates a two-tiered system that allows small businesses to underpay their staff relative to larger corporations for the same work until 2029.
- Does not immediately address the current disparity, allowing employers to continue using the outdated federal poverty-level threshold in the short term.
Pros for Conservatives
- Offers a multi-year phase-in period, providing businesses with a predictable timeline to adjust their payroll structures and budgets.
- Protects small businesses (50 or fewer employees) by granting them a slower implementation schedule and lower initial thresholds than large corporations.
- Retains the fundamental concept of overtime exemptions for executive and professional roles rather than eliminating them entirely.
Cons for Conservatives
- Imposes significant new labor costs on businesses, which may force employers to cut jobs, reduce hours, or freeze hiring to remain profitable.
- Interferes with the free market by dictating the terms of private employment contracts and salary levels for management positions.
- Creates a complex regulatory environment where businesses must track employee counts and fluctuating minimum wage multiples to ensure compliance.
Constitutional Concerns
None Likely
Impact Overview
Groups Affected
- Salaried Employees
- Small Business Owners
- Large Corporations
- Human Resources Departments
- Non-profit Organizations
Towns Affected
All
Cost to Taxpayers
None
Revenue Generated
Amount unknown
BillBuddy Impact Ratings
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Public Services
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Regulatory
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Clarity of Bill Language
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Environmental Impact
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Privacy Impact
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Bill Status
Current Status
Held
Comm Passed
Floor Passed
Law
History
• 02/04/2026 Introduced, referred to House Labor
• 03/13/2026 Scheduled for hearing and/or consideration (03/18/2026)
• 03/18/2026 Committee recommended measure be held for further study
• 03/13/2026 Scheduled for hearing and/or consideration (03/18/2026)
• 03/18/2026 Committee recommended measure be held for further study
Bill Text
SECTION 1. Section 28-12-4.3 of the General Laws in Chapter 28-12 entitled "Minimum Wages" is hereby amended to read as follows:
28-12-4.3. Exemptions.
(a) The provisions of §§ 28-12-4.1 and 28-12-4.2 do not apply to the following employees:
(1) Any employee of a summer camp when it is open no more than six (6) months of the year;
(2) Police officer;
(3) Employees of the state or political subdivision of the state who may elect through a collective bargaining agreement, memorandum of understanding, or any other agreement between the employer and representatives of the employees, or if the employees are not represented by an exclusive bargaining agent, through an agreement or understanding arrived at between the employer and the employee prior to the performance of work, to receive compensatory time off for hours worked in excess of forty (40) in a week. The compensatory hours shall at least equal one and one-half (1½) times the hours worked over forty (40) in a week. If compensation is paid to an employee for accrued compensatory time, the compensation shall be paid at the regular rate earned by the employee at the time of payment. At the time of termination, unused accrued compensatory time shall be paid at a rate not less than:
(i) The average regular rate received by the employee during the last three (3) years of the employee’s employment; or
(ii) The final regular rate received by the employee, whichever is higher;
(4) Any employee employed in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., compensated for services on a salary basis of not less than two hundred dollars ($200) per week;
(5) Any employee as defined in subsection (a)(4) of this section unless the wages of the employee, if computed on an hourly basis, would violate the applicable minimum wage law;
(4)(i) Through December 31, 2026, any employee employed in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would violate the applicable minimum wage law, as defined by § 28-12-3;
(ii) Commencing January 1, 2027, through December 31, 2027: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than one and one-half (1½) times the minimum wage, established by § 28-12-3;
(iii) Commencing January 1, 2027, through December 31, 2027: any employee employed by an employer with more than fifty (50) employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two (2) times the minimum wage, established by § 28-12-3;
(iv) Commencing January 1, 2028, through December 31, 2028: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two (2) times the minimum wage, established by § 28-12-3;
(v) Commencing January 1, 2028: any employee employed by an employer with more than fifty (50) employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two and one-half (2½) times the minimum wage, established by § 28-12-3;
(vi) Commencing January 1, 2029: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two and one-half (2½) times the minimum LC004604 - Page 2 of 4 wage established by § 28-12-3;
(6)(5) Any salaried employee of a nonprofit national voluntary health agency who elects to receive compensatory time off for hours worked in excess of forty (40) hours per week;
(7)(6) Any employee, including drivers, driver’s helpers, mechanics, and loaders of any motor carrier, including private carriers, with respect to whom the United States Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the provisions of 49 U.S.C. § 31502;
(8)(7) Any employee who is a salesperson, parts person, or mechanic primarily engaged in the sale and/or servicing of automobiles, trucks, or farm implements, and is employed by a non- manufacturing employer primarily engaged in the business of selling vehicles or farm implements to ultimate purchasers, to the extent that the employers are exempt under the Fair Labor Standards Act of 1938, 29 U.S.C. § 213(b)(10); provided, that the employee’s weekly, biweekly, or monthly actual earnings exceed an amount equal to the employee’s basic contractual hourly rate of pay times the number of hours actually worked plus the employee’s basic contractual hourly rate of pay times one-half (½) the number of hours actually worked in excess of forty (40) hours per week;
(9)(8) Any employee employed in agriculture; however, this exemption applies to all agricultural enterprises that produce greenhouse crops, fruit and vegetable crops, herbaceous crops, sod crops, viticulture, viniculture, floriculture, feed for livestock, forestry, dairy farming, aquaculture, the raising of livestock, furbearing animals, poultry and eggs, bees and honey, mushrooms, and nursery stock. This exemption also applies to nursery workers; and
(10)(9) Any employee of an air carrier subject to the provisions of 45 U.S.C. § 181 et seq., of the Railway Labor Act when the hours worked by that employee in excess of forty (40) in a workweek are not required by the air carrier, but are arranged through a voluntary agreement among employees to trade scheduled work hours.
(b) Nothing in this section exempts any employee who under applicable federal law is entitled to overtime pay or benefits related to overtime pay.
SECTION 2. This act shall take effect upon passage.
28-12-4.3. Exemptions.
(a) The provisions of §§ 28-12-4.1 and 28-12-4.2 do not apply to the following employees:
(1) Any employee of a summer camp when it is open no more than six (6) months of the year;
(2) Police officer;
(3) Employees of the state or political subdivision of the state who may elect through a collective bargaining agreement, memorandum of understanding, or any other agreement between the employer and representatives of the employees, or if the employees are not represented by an exclusive bargaining agent, through an agreement or understanding arrived at between the employer and the employee prior to the performance of work, to receive compensatory time off for hours worked in excess of forty (40) in a week. The compensatory hours shall at least equal one and one-half (1½) times the hours worked over forty (40) in a week. If compensation is paid to an employee for accrued compensatory time, the compensation shall be paid at the regular rate earned by the employee at the time of payment. At the time of termination, unused accrued compensatory time shall be paid at a rate not less than:
(i) The average regular rate received by the employee during the last three (3) years of the employee’s employment; or
(ii) The final regular rate received by the employee, whichever is higher;
(4)(i) Through December 31, 2026, any employee employed in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would violate the applicable minimum wage law, as defined by § 28-12-3;
(ii) Commencing January 1, 2027, through December 31, 2027: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than one and one-half (1½) times the minimum wage, established by § 28-12-3;
(iii) Commencing January 1, 2027, through December 31, 2027: any employee employed by an employer with more than fifty (50) employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two (2) times the minimum wage, established by § 28-12-3;
(iv) Commencing January 1, 2028, through December 31, 2028: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two (2) times the minimum wage, established by § 28-12-3;
(v) Commencing January 1, 2028: any employee employed by an employer with more than fifty (50) employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two and one-half (2½) times the minimum wage, established by § 28-12-3;
(vi) Commencing January 1, 2029: any employee employed by an employer with fifty (50) or fewer employees in a bona fide executive, administrative, or professional capacity, as defined by the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq., unless the wages of the employee, if computed on an hourly basis, would equal less than two and one-half (2½) times the minimum LC004604 - Page 2 of 4 wage established by § 28-12-3;
(b) Nothing in this section exempts any employee who under applicable federal law is entitled to overtime pay or benefits related to overtime pay.
SECTION 2. This act shall take effect upon passage.