Business Lobby Is Denied Overtime To Kill Overtime Rule

Isaiah J. Poole

This is the final week that the Labor Department is accepting comments on a proposed rule that would make some 5 million additional workers eligible for overtime pay for working more than 40 hours a week. A last-ditch effort to give businesses more time to campaign to defeat the rule was rejected today by the Department of Labor.

The overtime rule is a big deal for workers who earn as little as $24,000 a year in salaried positions – they are called managers but very little of what they actually do could be considered “managerial.” These are the people who stock store shelves, keep facilities clean, help serve food and do any number of other tasks that are typically done by hourly workers. But by calling these workers managers, they can require them to work virtually unlimited hours – as many as 70 or 80 hours a week – without giving them a dime in additional pay. That means some “managers” can be effectively working for less than the minimum wage.

The Labor Department is proposing raising the wage threshold for considering someone a salaried employee from $23,660 (less then the poverty level for a family of four) to $50,400. That would mean that the percentage of workers eligible for overtime pay would be closer to the 60 percent of workers who were eligible for overtime pay in 1975. Currently, that percentage has fallen to 8 percent.

Business lobbying organizations like the National Retail Federation had been lobbying fiercely to get the Department of Labor to extend the comment period beyond 60 days. That is even though the comment page for the proposed regulation is flooded with comments ginned up by businesses. (As of late Tuesday, at least 411 of the nearly 146,000 comments started with one of two opening sentences from form letters written by the National Retail Federation.)

Also fighting to extend the time businesses could mobilize against the regulation were the Republicans on the House Education and Workforce Committee, who said that “evaluating the implications of these proposed changes will take some time for many small businesses, nonprofit organizations, and other enterprises” – even though there is no evidence that opponents of the rule have had any difficulty flooding the Labor Department with detailed arguments.

Then there are comments like those of Caleb Sneeringer, a former Walgreens employee who recently told her story to the Economic Policy Institute.

“in 2010 I was promoted to executive assistant manager—my first salaried position with Walgreens. I earned a salary of $46,000 and was scheduled for 45 hours a week,” she wrote. “Unfortunately, 45 hours a week quickly turned into 55–70 hours. You see, around the time of my promotion, Walgreens implemented a ‘no overtime’ rule for hourly employees. In my store this and other budget cuts resulted in a loss of approximately 150 hours a week among hourly employees—and their work and responsibilities were shifted to salaried staff. This created a more unpredictable scheduling situation, and many store associates were forced to use SNAP assistance (i.e., food stamps) to meet their basic needs.”

One comment on the Department of Labor site from a person identified as Nicholas Kitchel wrote that he worked at a WashingtonD.C. nonprofit and earned a salary that “is just barely enough to be able to afford to pay rent and buy groceries. While I love my work, I am often required to work 50-60 hours per week. If I received overtime pay, I wouldn’t have to struggle and at times cut corners to manage my modest budget. I would probably even be able to save a little money towards the cost of grad school.”

“Employers will no longer be able to arbitrarily classify [workers] in such a way that they are able to get massive free labor and abuse them to the point that they have no way to plan their lives or spend any time with their families,” another commenter, Miki Wright, wrote. “They will no longer be wage slaves.”

Businesses that were perfectly capable of working under the overtime thresholds that were in place in the 1970s are now abusing the rules to pad their profit margins at the expense of the well-being of their workers. The proposed new overtime threshold would restore sanity and justice to workers who need and deserve overtime pay for working overtime.

The comment period ends Friday. In addition to commenting on Regulations.gov, you can learn more information and file a comment through FixOvertime.org.

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