U.S. Chamber: Overtime Rule Will Burden Employers in Tepid Economy | U.S. Chamber of Commerce

U.S. Chamber: Overtime Rule Will Burden Employers in Tepid Economy

Wednesday, May 18, 2016 - 11:30am

‘The regulation demonstrates this administration’s determination to control employers instead of creating conditions for economic growth,’ says Johnson

WASHINGTON, D.C.—U.S. Chamber of Commerce Senior Vice President of Labor, Immigration, and Employee Benefits Randy Johnson issued the following statement today regarding the Department of Labor’s final overtime rule:

“While the Department of Labor made some important changes in the final regulation, the revised overtime regulation issued today still represents another regrettable burden being piled on employers as they attempt to grow in a tepid economy. The regulation demonstrates this administration’s determination to control employers instead of creating conditions for economic growth. Cloaked in feel-good, self-congratulatory rhetoric, the administration has repeatedly failed to accurately analyze the cost and benefits of its regulations, or the impact its regulatory onslaught will have on job growth.

“The overtime regulation joins the recently finalized fiduciary rule, which will reduce the ability of small businesses to provide retirement benefits; the EEOC’s proposed revised EEO-1 form that will explode the burden on employers for reporting compensation by micro demographics; OSHA’s just released injury reporting regulation that will result in sensitive employer data being posted on the internet for use by unions and trial lawyers; and the Department of Labor’s recently issued ‘persuader’ regulation that is intended to chill the ability of employers to retain competent labor counsel during union organizing campaigns.

“Combined with all of these measures, the overtime regulation is just another example of how little this administration understands how the economy works or regards employers’ concerns. The administration claims that the changes were made as a result of listening to employers, but what they have done is more cosmetic than substantive. If they had really listened, the salary threshold would have been significantly lower. The Chamber argued in our comments and meetings that the key to making this regulation acceptable was a modest increase in the salary threshold, not increasing it by more than 100% to almost $47,500.   

“Despite the modifications, the dramatic escalation of the salary threshold, below which employees must be paid overtime for working more than 40 hours a week, will mean millions of employees who are salaried professionals will have to be reclassified to hourly wage workers. Small businesses, nonprofits, and public sector employers will be especially impacted as they will have the hardest time finding more income to cover the increased labor costs, even if they will have a longer time to implement the new requirement. Furthermore because the threshold will increase every three years, the impact on these employers will continue to ratchet up. This will result in charities providing fewer services to those in need, local governments having to reduce services and raise taxes, and small businesses having to curtail operations or plans to expand. The Department of Labor failed to accurately assess the impact this regulation would have on these, and other, employers.”