State Attorney General Bill Schuette continues to offend average independent voters in his attempt to coddle conservative Republicans in advance of his 2018 Republican run for governor.
Representing Michigan, Schuette has joined 20 other states in a lawsuit seeking to block the Obama administration’s restoration of overtime pay requirements to the same level, after adjusting for inflation, of decades ago. It’s hard to imagine a more basic issue that affects the working-class than forcing them to work more than 40 hours weekly for no additional pay.
The pending Labor Department mandate would increase the salary threshold from $23,000 to $47,000 a year for guaranteed overtime, time-and-a-half pay to workers. In 1975, the overtime threshold covered more than 60 percent of salaried workers. Today, only the bottom 8 percent are covered, a level that is roughly at the poverty rate for a family of four.
The administration’s effort is an attempt to nearly catch up with the original overtime protections for workers, first established in the Roosevelt administration, after decades of deterioration due to the rate of inflation.
The rule set to take effect Dec. 1 would keep current by permanently linking the OT threshold to the 40th percentile of national income. Obviously, the new regulation does not apply to hourly unionized workers who already receive time-and-a-half.
This is one of those basic Little Guy vs. Corporate Executives issues.
No change since Gerald Ford in 1975
Yet, business interests, particularly the U.S. Chamber of Commerce and the National Retail Federation, have acted as if the rule amounts to an attack on the U.S. economy. They call the mandate “another example of the administration being completely divorced from reality and adding more burdens to employers and expecting them to just absorb the impact.”
To be fair, catching up on decades of neglect in one fell swoop could have been avoided with a phase-in process for employers. Essentially, Congress is to blame for ignoring this issue for 40 years.
The last time the threshold was raised in 2004, President George W. Bush boosted the salary amount slightly to $23,660. Prior to that, the last time the salary threshold was adjusted upward was in 1975 by President Ford.
Interestingly, the 21-state lawsuit relies on the argument that the OT rule will be a burden to the public sector, to state governments, and represents a violation of the constitution’s 10th Amendment. In effect, Schuette, who has sided against low-income Michiganders numerous times, is arguing that the Snyder administration cannot afford to pay state employees for time worked beyond 40 hours.
The overtime eligibility rule announced by the president will bring the old regulation up to par so that, factoring in cost-of-living increases, salaried workers earning up to $47,476 – double the current rate — must be paid time-and-a-half beyond 40 hours of work.
Companies cry poverty
Much like the debate over the minimum wage, the corporate battle over OT fails to acknowledge that when these wage requirements had a much bigger impact for workers was in the 1960s when the U.S. economy reached unprecedented heights.
In other words, the business community must explain why a return to the 1960s would be such a hardship in 2016. What’s more, with the wage concessions and mass layoffs we have witnessed over the past decade, the corporate strategy has been to cut their workforce and require the remaining employees to work more hours for the same pay – or less. That’s a big bonus for the bottom line.
If overtime pay is a burden as described by the business community, the question is: While companies have received a windfall for decades while the overtime requirement shrank dramatically in comparison to the cost of living, what do we have to show for it?
If enhancing the OT rule means a loss of jobs, as corporate America claims, where is the evidence of jobs gained while the rule’s initial impact on employers slowly disappeared?
