Bill cuts overtime pay for workers receiving stock grants

What it does

This bill amends the Fair Labor Standards Act to clarify that restricted stock units (RSUs)—a common form of equity compensation—are excluded from an employee's 'regular rate' when calculating overtime pay, just like stock options and employee stock purchase plans already are. The bill also shields employers from liability for past non-compliance with this new rule for 90 days after enactment, and longer if the program existed before the bill passed or is covered by a union contract.

Why we flagged it

The bill's stated purpose is to 'protect worker access to employer equity,' but its operative mechanism reduces the wage base used to calculate overtime pay. By excluding RSU value from the regular rate, the bill lowers overtime compensation for workers who receive equity grants—a financial cost to workers, not a protection.

What the text implies

• Workers receiving RSUs will see lower overtime pay because RSU value no longer counts toward the regular rate—a wage reduction disguised as equity access.
• The 90-day liability shield and extended safe harbor for existing programs prevent workers from recovering back pay for overtime underpayment during the transition period.
• The bill's framing as 'protecting worker access' obscures that it reduces worker compensation; the real beneficiary is employers who avoid overtime liability on equity-compensated workers.
• Hourly workers in tech and other equity-heavy industries are most affected, as they are most likely to receive RSUs and work overtime.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

Hourly and salaried workers lose potential overtime compensation because RSU value is now excluded from the regular rate calculation. While RSUs are framed as a benefit, the bill's operative effect is to reduce the wage base used to compute overtime—meaning workers who receive RSUs and work overtime will be paid less for those overtime hours than they would have been if RSUs counted toward their regular rate. The liability shield further protects employers from claims for past underpayment.

Who stands to gain

• technology companies and other employers offering RSU programs
• employers with hourly or salaried workforces receiving equity compensation

Named in the bill

Fair Labor Standards Act of 1938, Worker Economic Opportunity Act (Public Law 106-202), restricted stock units (RSUs), stock options, employee stock purchase programs, regular rate (overtime calculation), Senate Committee on Health, Education, Labor, and Pensions

Where it stands

• Sep 30, 2026 — Introduced · Congress.gov: “Introduced in Senate”
• Sep 30, 2026 — Referred to Senate Committee on Health, Education, Labor, and Pensions · Congress.gov: “Read twice and referred to the Committee on Health, Education, Labor, and Pensions”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.