Empowering Employer Child and Elder Care Solutions Act
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This bill would exclude employer-funded child or elder care benefits from the calculation of an employee's regular rate for overtime pay.
What it does
This bill would exclude the value of employer-provided child or elder care services from the calculation of an employee's regular rate of pay for overtime purposes. Under current law, overtime pay is calculated based on an average hourly rate that includes various forms of compensation, which can be increased by the value of these employer-funded benefits. By removing these care services from the calculation, the bill would allow employers to offer dependent care assistance without increasing the required hourly rate for overtime hours.
Who is affected
This bill affects eligible employees who receive employer-funded child or dependent care services and work overtime hours. It also impacts employers who provide or pay for these care services, as the value of such benefits would no longer be included when calculating an employee's regular rate of pay for overtime purposes.
Key provisions
- Exclusion of dependent care from overtime calculations. The bill excludes the value of employer-funded child or dependent care services from the calculation of an employee's regular rate of pay for overtime purposes.
- Clarification of employer-provided care benefits. The legislation specifies that employers may provide or pay for child or dependent care without those benefits increasing the required one and a half times hourly rate for overtime hours.
Fiscal impact
- H.R. 2270, Empowering Employer Child and Elder Care Solutions Act· As ordered reported by the House Committee on Education and the Workforce on April 9, 2025
Effective dates
Not applicable: Official Summary does not address effective dates
Relationship to existing law
The bill modifies existing labor standards regarding the calculation of overtime pay, which currently requires an employee's regular rate of pay to include various forms of compensation. It creates an exception to these requirements by excluding the value of employer-funded child or dependent care services from the calculation of an employee's regular hourly rate.
Stated purpose
The bill aims to allow employers to provide or fund child and elder care services for employees without increasing the cost of overtime compensation. It achieves this by excluding the value of these care benefits from the calculation of an employee's regular rate of pay used to determine overtime wages.