GOP lawmakers: Obama’s overtime rule will cost billions

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GOP lawmakers say President Obama’s proposal to raise the salary threshold and extend overtime pay to 5 million Americans will cost employers billions of dollars.

During a hearing of the House Education and the Workforce Subcommittee on Workforce Protections, Chairman Tim Walberg (R-Mich.) said the rule will force employers to demote salaried employees to hourly workers with lower pay and stricter schedules. With that shift, he said, comes fewer opportunities for on-the-job training and managerial experience.

{mosads}“It will limit the opportunity to advance the economic ladder, and isn’t that what America is all about?” he asked.

The rule, which will be issued by the Department of Labor, would make all salaried workers who earn less than $50,440 per year automatically eligible to earn time-and-a-half pay if they work more than 40 hours a week. Now only workers who make less than 23,660 per year are eligible.

“The Department of Labor has estimated that this specific rule will cost $600 million in the first year, which to me seems unbelievable,” said Rep. Mike Bishop (R-Mich.).

But Democrats on the subcommittee say the rule will restore the principle of the Fair Labor Standards Act.

“As a prelude to the passage of fair labor standards act, President Franklin Roosevelt said ‘All Americans deserve a fair day’s pay for a fair day’s work,’ ” Rep. Frederica Wilson (D-Fla.) said. “This principle is the foundation of the historic labor law. We must protect the workforce.”

Wilson said overtime pay was established to protect workers from excessive hours that endanger their health and wellbeing.

“It’s not fair that people making $23,660 a year are asked to work 50, 60 hours a week without the opportunity for overtime pay,” she said.  

Tags Business law Employment compensation Fair Labor Standards Act Frederica Wilson Human resource management Labor Labor rights Labour relations Law Management Overtime Salary Time-and-a-half Working time
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