Industry Groups Say Overtime Rule Will Hurt More than HelpMay 18th, 2016 by Editor
A few industry associations are speaking out in response to the final rule announced by the U.S. Department of Labor (DOL) regarding overtime pay. The National Lumber and Building Material Dealers Association (NLBMDA) for one says it will dramatically increase the number of employees eligible for overtime pay.
As part of the final rule, the salary level under which employees qualify for overtime pay will increase from $455 per week ($23,360 annually) to an estimated $913 per week ($47,476 annually), says the association. The rule is effective December 1, 2016 and the salary threshold will update automatically every three years.
“DOL’s one-size-fits-all approach will create greater confusion for employers and employees alike in small business workplaces that require flexibility, initiative, and innovation,” according to a statement from the association.
“DOL’s final overtime rule may actually hurt the people it is designed to help,” said NLBMDA Chairman Scott Yates, who serves as president and general manager of Denver Lumber Company in Denver. “Lumber dealers fairly compensate their employees but the new rule could have unintended consequences causing a reduction in flexibility and advancement opportunities for employees.”
The association had stated its opposition to the rule on several occasions to the White House’s Office of Management Budget (OMB) Office of Information of Regulatory Affairs (OIRA). NLBMDA also submitted written comments to DOL in September 2015 opposing the rule.
The National Association of Home Builders (NAHB) also has a strong message for the DOL.
“The sheer arrogance displayed by the Department of Labor in failing to heed the concerns of the nation’s small business community will result in severe repercussions that will harm workers, small businesses, housing affordability, job growth and the economy,” says NAHB chairman Ed Brady.
Legislation was introduced in March in both the House of Representatives and Senate that would delay the Overtime Rule. The Protecting Workplace Advancement and Opportunity Act (H.R. 4773, S. 2707) would halt the changes to overtime pay eligibility criteria and require DOL to conduct a comprehensive economic analysis on the impact of mandatory overtime expansion to small businesses, nonprofits and public employers.
“Congress can play a constructive role by moving quickly to pass the Protecting Workplace Advancement and Opportunity Act, legislation that would force the agency to withdraw this rule until it has considered the effects it would have on small businesses, consumers, workers and the economy,” says Brady.
NLBMDA will also continue to seek a legislative remedy limiting or repealing the changes
“We are hopeful congressional action can help bring a rational approach to addressing minimum salary thresholds for overtime pay,” says Jonathan Paine, NLBMDA president and CEO. “Unfortunately, the DOL’s simplistic approach of imposing such a large increase for determining overtime pay eligibility disrupts a bright-line test that employers have long-used to fairly compensate hourly workers and at the same time provide opportunities for worker initiative and responsibilities at the managerial levels.”