STATEMENT OF ADMINISTRATION POLICY
H.R. 6094 - Regulatory Relief for Small Businesses, Schools, and Nonprofits Act
(Rep. Walberg, R-MI, and 69 cosponsors)
The
Administration strongly opposes H.R. 6094, which would delay
implementation of the Department of Labor's overtime rule until the
middle of next year, endangering a critical step toward promoting higher
pay and undermining efforts to allow workers to better balance their
work and family obligations.
Since
its creation, the 40-hour workweek has served as a cornerstone of the
middle class. Yet over the past several decades, overtime protections
have eroded as a result of inflation and lobbyists' efforts to weaken
them. Today, only seven percent of full-time salaried workers qualify
for overtime based on their pay, down sharply from 62 percent in 1975.
This means that more and more low- and middle-income workers are being
forced to work extra hours without being paid for them. Despite strong
income growth in the last year, most American families have been
squeezed by stagnant earnings during this period, and the lack of
overtime protections only has put them at a further disadvantage.
The Department issued its new overtime regulation in May and the new rule is set to go into effect on December 1, 2016.
The final rule raises the salary threshold, from $23,660 to $47,476 a
year, under which most salaried workers are guaranteed overtime. In
doing so, it will extend overtime protections to 4.2 million additional
Americans who are not currently eligible for overtime under Federal law,
boosting workers' wages by $12 billion over the next decade. The rule
also will automatically update the salary threshold every three years,
to ensure that it does not erode again and to make it harder for
employers to misclassify workers to avoid paying the overtime pay they
have earned.
The
final rule reflects input from hundreds of thousands of public comments
and extensive stakeholder meetings with employers, business
associations, small businesses, workers, advocates, nonprofit
organizations, educational institutions, and state and local
governments. The rule provides more than six months for employers to
prepare for implementation, more time than was allowed when the rule was
last updated with a comparable increase in the salary threshold. Additionally, many employers, including nonprofits, institutions of higher education, and small businesses, are already taking steps to come into compliance. This bill would be disruptive to their efforts and create new uncertainty for employers.
While
this bill seeks to delay implementation, the real goal is clear—delay
and then deny overtime pay to workers. With a strong economy and labor
market, now is a good time for employers to provide these essential
protections for workers, who cannot afford to wait.
If the President were presented with H.R. 6094, he would veto the bill.
Source: Executive Office of the President, Office of Management and Budget
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