The provision raises the overtime pay cap to time and a half for a GS-10, Step 1, or an employee's basic rate of pay, whichever is greater. Previously, the cap was limited to time and a half for a GS-10, Step 1, which meant that any employee ranked above GS-12, Step 6, actually earned less working overtime than during regular hours.
For example, a GS-13, Step 9, supervisor earned $36.14 per hour, but while working overtime, that same employee earned just $26.64 per hour.
Karen Heiser, an official with the Federal Managers Association, told Congress last spring that the overtime cap was encouraging some federal employees "to leave the ranks of management and return to the bargaining unit or move to the private sector so they can earn a higher paycheck."
The overtime cap may have made more sense when it was set, in 1966, when the average federal employee was a GS-7. Nowadays, the average grade is GS-9.5. Until last month, the cap hadn't been increased in 27 years.
The amendment raising the cap went into effect Nov. 24. Agencies have already begun to implement the change and will make retroactive payments for overtime worked on that date and thereafter.
Overtime pay has long been a contentious issue for federal managers. In 2000, the Office of Personnel Management submitted legislation to lift the overtime cap after federal managers in western states complained about working long hours for low pay to supervise firefighters battling wildfires that raged out of control.
In 1998, Rep. Tom Davis, R-Va., proposed raising the overtime cap from one and a half times the GS-10, step 1 level, to one and a half times the rate of pay for GS-15, step 1. After many members of Congress rejected that proposal as too costly, Davis proposed that managers be guaranteed that they would always receive at least their regularly hourly pay rate during overtime hours. Neither proposal became law.