President Trump’s second choice to lead the Labor Department suggested at his confirmation hearing Wednesday that more employees should be paid for the overtime hours they work, “because life gets more expensive.”
The remarks from Labor Secretary nominee Alexander Acosta, a former Republican member of the National Labor Relations Board (NLRB), raised eyebrows from several Health, Education, Labor and Pensions panel Republicans.
“The overtime rule hasn’t been updated since 2004,” Acosta said. “It’s unfortunate that rules that involve dollar values can sometimes go more than a decade, sometimes 15 years, without being updated. Because life does get more expensive.”
At issue is the Labor Department’s overtime rule, which requires companies to pay time-and-a-half to low-income employees when they work more than 40 hours in a week.
Currently, the overtime rule protects workers who make less than $23,660 per year. The Obama administration attempted to raise the salary threshold to $47,476, estimating it would lift more than 4 million workers out of poverty, but that move has been placed on hold by a federal judge.
Republicans argue that such a large increase in the overtime threshold could hold back job creators. “Would doubling the threshold, doesn’t that concern you?” Sen. Lamar AlexanderLamar AlexanderAuthorities link ex-Tennessee governor to killing of Jimmy Hoffa associate The Republicans' deep dive into nativism Senate GOP faces retirement brain drain MORE (R-Tenn.) asked Acosta.
Acosta admitted the Obama administration’s revision would “create a stress on the system.”
“The world has gotten more expensive, and salaries have changed since 2004,” Acosta reiterated. “If you were to apply a straight inflation adjustment, I believe the figure if it were to be updated would be somewhere around $33,000, give or take.”
Democrats pushed Acosta to defend the Obama administration’s rule in court. But Acosta said he has “serious questions” about whether the Labor Department has the authority to raise the overtime salary threshold by more than the rate of inflation.