New Overtime Rule Causes Triple Damage to Economy

e21 ^ | May 18, 2016 | Diana Furchtgott-Roth

[mothball]

The current clown in the WH, is just trying to make work for Trump. I don’t think he realizes that Trump works more in one week, than that slap dick has in almost 8 years.

[Texas resident]

Yes, but Obama said that he ran his own campaign. That was enough managerial experience.

Some time there are no words.

[PrincessB]

When we were forewarned about this rule last Summer my salary was bumped (pretty nicely) to circumvent the rule. I have a position which requires A LOT of extra hours during two months of the year and my coming and going in December can be more flexible. My employer decided that this was easier than making me clock in (and I could have two more projects).

I wonder how this also affects travel. It’s not uncommon for us to have “drive in days” which are in other locations and have a 2-3 hour drive. We often leave for these things in the 7-7:30 range and sometimes aren’t back until 6:30-7:00 at night. It’s been as late as 8:30. Those interactions are a huge asset to our organization. I bet they will have to be curtailed in some way.

[jalisco555]

My son has a job where a lot of difficult to predict things occur. He often works 50+ hours a week. He receives an unusually large amount of non-monetary compensation so his salary is relatively low. No one knows how the work will get done with this new rule.

[A_Former_Democrat]

What does the $$$ amount have to do with whether hours should be compensated as OT?

Another vote buying, income redistribution scheme. Is this even legal? Why isn’t that point being raised? This sure looks like a legislative issue, not an executive one

[armydawg505]

Centralized planning on a socialist model has never worked but you can’t tell the lunatic left anything. They have to destroy a country like Venezuela and even then they refuse to acknowledge their destruction.

[jdsteel]

IMHO the next administration AND Congress has to start deconstructing the monster that has become the “interstate commerce” rule, which has grown to mean ALL commerce. We need to say the following phrase A LOT: “That is not a legitimate function of the federal government”.

[RainMan]

A lot of people here will criticize anything that Obama or the Dems do, but as the old saying goes, even a broken clock is right twice a day. In the case of this rule, it is actually a good thing.

Example 1: The company that I work for would routinely hire kids out of college at near poverty wages and demand at least 95% chargeability of time to clients. You were required to be in the office from 8-5 every day, but if you were not on a chargeable engagement, then when you DID get one, you had to work a ton of overtime to get up to the number of chargeable hours required. This rule would kill that practice, which means either the rule about having to be at work 8-5 regardless would get dropped, or the % chargeability rule would get dropped. Either way, the employee will benefit.

Example 2: My daughter went to work for Enterprise Rent-a-car, and they hire kids to be "Management Trainee's" and give them a low salary, but then schedule them for a minimum of 51 hours/week. This 50+ hour work week schedule is the expectation ad infinitum. She left after 3 years, and never worked a 40 hour week, nor had her fiancé who also used to work there.

The fact of the matter is, salary should not mean that you have become an indentured servant. Work-life balance is important, and putting rules in place to prevent companies from abusing their staff by making them salaried just so that they can overwork them is a good thing.

[Rusty0604]

That problem was solved by certain tests required to determine whether a person was really management, such as the percentage of their time spent performing actual management tasks. I know it was still abused, but I did HR and payroll for decades, and I made sure my employer followed the rules to avoid lawsuits.
Most of the people that had a choice of comp or overtime took the comp time. I never had the choice as a manager making way beyond the threshold, nevertheless I wouldn’t work excessive hours unless special circumstances required it.

[Rusty0604]

Very good point.

[RainMan]

And if you are salaried ... what is the problem with having your hours reduced?

[Rusty0604]

It will have a big impact. Just like the decision that franchisors can be held accountable independent franchisees labor decisions. Small business owners lose in both cases.

[commish]

I often work as a subcontractor and get paid for the work completed regardless of the hours it took to get the job done.

Gotta love good ole Firm Fixed Price work. :)

[Rusty0604]

Yes, that was a stupid statement and I was surprised at how many idiots gleefully accepted it.

[elpadre]

I didn’t realize the president could wave his want and cause such a profound change in labor law. What is the history of such - hours and wages???

[elpadre]

I worked for years in human recourses, including personnel manager, and don’t recall any of which you describe.

[MortMan]

I worked for years in human recourses...

Some typos are funny! I know it's typographical, but reading what was typed makes a twisted sort of sense!

[tbpiper]

The effect will be (1) to raise costs to employers, discouraging employment; (2) to prohibit flexible time for employees; and (3) to stunt American productivity and economic growth.

I'm inclined to believe that it's not so much the effect as it is the intent.

[IamConservative]

That problem was solved by certain tests required to determine whether a person was really management, such as the percentage of their time spent performing actual management tasks. I know it was still abused, but I did HR and payroll for decades, and I made sure my employer followed the rules to avoid lawsuits.

Abuse of the FLSA (Fair Labor Standards Act) guidelines for exempt vs. non-exempt is the root of the issue. I work in IT and I've seen a lot of companies abuse the vagaries of these guidelines. The Help Desk Analyst is a good example. Many companies classify this job as exempt, but it should be non-exempt.

Changing the threshold should be done by Congress because the threshold is specified in the FLSA. Obama is in effect re-writing this law.

[Red Badger]

And they are so smug and contemptuous of those that dare to be successful it makes me ill...........................