The administration will accomplish that by raising what’s known as the overtime salary threshold. Nearly all workers earning salaries beneath that threshold are entitled to time-and-a-half pay whenever they work more than 40 hours in a week.

The current threshold is just $23,660. The White House will be doubling that number, to $47,476, guaranteeing overtime rights for salaried workers earning less than that. The Labor Department will now update the threshold every three years to make sure it keeps pace with inflation.

The White House estimates that the change will bring overtime rights to 4.2 million workers who are currently excluded. It will also clarify eligibility for another 8.9 million workers who may or may not have overtime protections under the current rules, officials said.

On a call with reporters Tuesday, Labor Secretary Tom Perez said the reform was meant to address “both underpay and overwork.”

“The overtime rule is about making sure middle-class jobs pay middle-class wages,” Perez said. “Some will see more money in their pockets … Some will get more time with their family … and everybody will receive clarity on where they stand, so that they can stand up for their rights.”

Eoin Treacy's view

US Average Hourly Earnings All Employee YoY broke out of a six-year range in September and the Fed raised interest rates for the first time in years shortly afterwards. There is a great deal of speculation about the health of the economy but there is no denying minimum wages demands are rising; with a number of major conurbations having already hiked the rate to $15. The move by the government to make more mid-level employees eligible for overtime is another move that is likely to put upward pressure on wage demands.

These factors will not show up immediately in the hourly earnings figures, not least because they are reported with a lag, but wages are rising. Wage growth is a major consideration for the Federal Reserve in making decisions on whether to raise rates again so they will be playing close attention to how this policy decision affects the labour market.

12-month yields found support last week in the region of the trend mean near the psychological 50 basis point area. A sustained move below that level would be required to question potential for additional upside.  

The stock market was rather volatile today but the short-term downward bias remains intact.