Obama Overtime Rule Faces Opposition From His Own Party


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Democratic Rep. Kurt Schrader introduced a measure designed to delay an upcoming overtime rule Thursday out of concern it will put an unnecessary burden on businesses.

President Barack Obama and his administration have worked hard to expand overtime to more exempt workers. The Department of Labor (DOL) released a final version of a rule May 18 that raises the salary exemption for manager and executive positions so millions more workers can qualify. Schrader agrees the threshold should be raised, but notes concern about how it’s being done.

“This bill will do exactly that without disrupting the way businesses operate and employees are paid,” Schrader said in a statement. “Since the DOL’s immediate phase-in date was announced, we’ve heard from business owners and their employees who are worried about implementing this increase overnight.”

Executive or manager positions can’t qualify for overtime if they have a salary of at least $23,660. The updated rule will raise the exemption threshold to $47,476 annually when it gets implemented Dec. 1. Schrader wants the new rule to instead be phased in over three years so businesses have time to adapt.

“Without sufficient time to plan for the increase, cuts and demotions will become inevitable, and workers will actually end up making less than they made before,” Schrader continued. “It’s long past time we strengthen overtime pay protections for American workers in a meaningful and effective way.”

The White House estimates the rule change will make an additional 4.2 million workers eligible for overtime. The administration has argued the updated rule will help restore overtime privileges that have dwindled over the decades. While the business community is still very much opposed to the rule, some are applauding Schrader for trying make it less stressful for employers.

“Inflicting a rule with such massive change upon small businesses without a phase-in period is a stunning blow to hiring, promotion and new business development,” International Franchise Association President Robert Cresanti said in a statement. “The IFA supports Rep. Schrader’s legislation as another opportunity to ease the burden this new rule places on small business owners.”

Republican Sens. Lamar Alexander and Ron Johnson introduced legislation June 7 to block the rule before it goes into effect. Republicans have been at the forefront of opposing the rule, but now even some Democrats are noting some concern. Schrader introduced his legislation with fellow Democrats.

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