Ryan: Overtime rule is 'absolute disaster'

House Republican leaders are slamming the Obama administration for expanding overtime pay to some 4 million Americans.

In a statement, Speaker Paul RyanPaul Davis RyanMcConnell names Senate GOP tax conferees House Republican: 'I worry about both sides' of the aisle on DACA Overnight Health Care: 3.6M signed up for ObamaCare in first month | Ryan pledges 'entitlement reform' next year | Dems push for more money to fight opioids MORE (R-Wis.) called the overtime rule an "absolute disaster" for the economy.

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“This regulation hurts the very people it alleges to help,” he said. “Who is hurt most? Students, nonprofit employees, and people starting a new career. By mandating overtime pay at a much higher salary threshold, many small businesses and nonprofits will be unable to afford skilled workers and be forced to eliminate salaried positions, complete with benefits, altogether.”

The rule released late Tuesday makes anyone earning up to $47,476 a year, or roughly $913 a week, eligible for overtime pay.

In a concession to business groups, the administration reduced the threshold for overtime pay by about $3,000, down from the $50,440 cutoff initially proposed, but groups claim the policy change is still too dramatic an increase. The cutoff for overtime pay now stands at $23,660 per year.

Ryan accused President Obama of focusing on his political legacy to the detriment of the country.

"President Obama is rushing through regulations — like the overtime rule — that will cause people to lose their livelihoods. We are committed to fighting this rule and the many others that would be an absolute disaster for our economy."

House Majority Leader Kevin McCarthy (R-Calif.) called the rule “misguided meddling in the economy."

 

"The rule will force employers to waste time and resources logging hours,” he said in a statement. “It will also require workers to fit their lives into a mold that bureaucrats impose, not what works best for them."

Business groups are pushing lawmakers to stop the Labor Department from implementing the rule by passing the Protecting Workplace Advancement and Opportunity Act, a GOP-backed bill introduced in the House and Senate.  

"The challenge this poses for employers, both in terms of time and expense, is daunting,” Jade West, senior vice president of government relations for the National Association of Wholesaler-Distributors, said in a statement.

“But the real victims of this new rule will be those well-compensated workers who will now be required to punch a time clock and lose the workplace flexibility they have enjoyed and which is so important to women and men who struggle to balance their responsibilities at work with the requirements of family life.” 

The legislation would force the Labor Department to consider the impact of the rule on small businesses, nonprofits and higher education institutions. 

The National Retail Federation (NRF) said momentum for the bill is building.

“I think the Department of Labor and the administration kept a lockdown on the docket and correspondences going in from Democratic members expressing concerns,” NRF Senior Director of Government Relations Lizzy Simmons said. “As we move forward we’ll be able to see the sheer magnitude of concern expressed by Dems, and we’ll be able to go from there.”

To address concerns about the rule among healthcare service providers that rely exclusively on Medicaid funding, the Department of Labor has created a time-limited nonenforcement policy.

From December 1 to March 17, 2019, the agency said providers of Medicaid-funded services for individuals with intellectual or developmental disabilities in residential homes and facilities with 15 or fewer beds will not be forced to pay the extra overtime.

The American Network of Community Options and Resources (ANCOR) welcomed the 34-month delay.   

“While the delay in itself is not a complete solution to this problem, the recognition of the issue in the rule is an important first step in our campaign to ensure Congress, the administration and states provide the necessary funding to extend the full benefits of the new rule to the dedicated professionals who work every day to ensure people with disabilities have the opportunity to realize the promise of the Americans with Disabilities Act," ANCOR CEO Barbara Merrill said in a statement.

Updated at 1:47 p.m.