The Obama administration announced in an op-ed that rules for expanding those that are eligible for overtime would be expanded. In an op-ed for the Huffington Post (6/29) (6/29), Mr. Obama wrote that “too many Americans are working long days for less pay than they deserve. That’s partly because we’ve failed to update overtime regulations for years – and an exemption meant for highly paid, white collar employees now leaves out workers making as little as $23,660 a year – no matter how many hours they work.”
The CBS Evening News (6/30, story 6, 1:35, Pelley) reported, “As many as five million Americans could get a raise under a plan that Mr. Obama announced today to expand overtime pay.” CBS (Garrett) added that currently, those “who make more than $23,660 per year for their 40-hour work week are not eligible for overtime pay. Under the new Labor Department rule, that salary cap would be raised to $50,440 per year. That’s the first overhaul of the overtime rules since 1975.”
The Hill (7/1, Fabian) reported that the new rule “represents one of Mr. Obama’s most far-reaching moves to reduce income inequality.” Labor Secretary Perez told reporters on Tuesday, “This proposed overtime rule goes to the heart of what it means to be middle class in America.” However, the rules set up a “confrontation with business groups and Republicans in Congress, who believe it will cost jobs and slow the economy.” The Los Angeles Times (7/1, Mai-Duc) examined the details of the changes, and adds that Perez “said the new rules could add as much as $1.3 billion nationwide to workers’ pockets.”
NBC Nightly News (6/30, story 6, 1:50, Holt) reported that “millions more Americans could take home bigger paychecks” under the new rule. However, NBC (Alexander) added that “some employers say they may have to cut hours rather than pay more.” Neil Trautwein, National Retail Federation: “There’s no magic pot of money in order to pay people more money, no matter what government says.” The Wall Street Journal (7/1, Trottman, Subscription Publication) reported that Randy Johnson of the US Chamber of Commerce said the rules “will not guarantee more income, but instead will negatively impact small businesses and drastically limit employment opportunities.”
USA Today (7/1, Eversley) reported that the Society for Human Resource Management said in a statement “that while it understands the need to improve employee compensation, it also is concerned that the non-profit and service economy sectors will be disproportionately affected.” The story says that the statement added that it would force employers to “have to track time of salaried managers and stick to rigid schedules, ‘all of which will have a significant impact on employee morale.’”
The Washington Post (7/1, DePillis) reported that unions and “progressive groups” pushed hard for the change, “and hailed the announcement as a step in the right direction,” arguing that it “might even prompt more hiring if employers avoid overtime by bringing on more workers.” However, “business groups campaigned fiercely against the new overtime rule, both publicly and in Congress.”
Source: NFIB Small Business Weekly, July 7, 2015.
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