Big ‘I’ Pushes Back on DOL Overtime Rule

In its continuing efforts to advocate on behalf of small businesses, the Big “I” submitted written testimony to a U.S. Senate committee outlining the association’s concerns with the proposed Department of Labor (DOL) overtime rule that could burden many small agencies.

This week, the Senate Committee on Small Business and Entrepreneurship held a hearing, “An Examination of the Administration’s Overtime Rule and the Rising Costs of Doing Business,” to review numerous concerns with the DOL proposal.

During the hearing, committee members on both sides of the aisle expressed concern that the DOL has not sufficiently analyzed the potential effect of the rule on small businesses. Despite these concerns, the DOL is in the final phase of completing its overtime rule and is expected to release it before July.

As proposed, the rule would require that employees who make less than $50,440 receive overtime pay, but most workers who make more than $50,440 and meet certain requirements would not be entitled to overtime. Currently, the threshold salary for this overtime exemption is $23,660.

The Big “I” does not oppose updating the current salary threshold, which has not been adjusted for inflation since 2004. However, the association is concerned about the excessive 113% increase.

The DOL proposal would also institute an annual inflation adjustment to the salary threshold, which the Big “I” is concerned will be overly burdensome for small businesses. The current proposal would give employers a short 60-day notice to adjust to the annual increases.

In response to growing and widespread concern over the DOL proposal, Sens. Tim Scott (R-South Carolina) and Lamar Alexander (R-Tennessee) and Reps. Tim Walberg (R-Michigan) and John Kline (R-Minnesota) have introduced S. 2707 and H.R. 4773, the “Protecting Workplace Advancement and Opportunity Act.” The legislation would halt the current rulemaking process and forbid the DOL from re-proposing the rule unless it meets certain conditions, including protections for small businesses. The Big “I” supports this legislation and has also met with the Obama Administration regarding concerns related to the rule.

Jennifer Webb is Big “I” federal government affairs counsel.