Department of Labor nears overtime protection decision

On Friday, the Department of Labor ended its public comment period regarding a proposed rule that would extend overtime protections to nearly 5 million white-collar workers within its first year of implementation. These updated regulations close an eligibility exemption that the Department of Labor claims was originally meant for "highly-compensated executive, administrative, and professional employees," and now applies to workers earning as little as $23,660 a year to as much as $50,440.

In the announcement, the DOL used fast food workers and convenience store managers as examples of employees expected to work 50-60 hours a week or more yet still living under the poverty level. 

However, the American Hotel & Lodging Association said the increase is "too high, too fast." In a recent response to the announcement from the DOL, the AH&LA filed comments to the DOL urging the Department to use a past precedent and methodology to find a "more reasonable salary threshold." The full comments can be found here.

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“The hotel industry is responsible for nearly 2 million jobs in communities across America and offers desirable assets that attract employees from all walks of life, including flexible hours, career growth, training opportunities, and good-paying jobs and benefit packages,” said Brian Crawford, AH&LA VP of government and political affairs. 

“While the lodging industry supports a fair and equitable working environment for both employees and employers, we caution the unintended consequences of raising the threshold too high, too fast. The majority of jobs offered in our industry already have starting wages above the minimum wage and employers currently have the flexibility to set salary parameters that foster a strong team environment, which allow for good benefits, higher pay, and workable schedules. Meddling in this employer-employee balance will surely cost business and stability.

“Further, the proposed changes will severely impact small business owners, especially those in rural communities, who operate under tight budget margins that can’t offset the substantial increase in labor costs the proposed changes will undoubtedly create for employers," Crawford said. "This will result in unintended consequences that will ultimately harm the very employees that the rule purports to help, preventing their advancement and opportunity and keeping the industry from continuing to grow and create jobs. AH&LA urges the DOL to reevaluate its proposed rule given the significant consequences it could have on the hotel industry and its hardworking employees and employers."

Ross Ross Eisenbrey, VP of the Economic Policy Institute, told The American Prospect that the last time the overtime threshold was significantly raised was in 1975 to $23,660. At the time it covered 61 percent of salaried employees. Since then, inflation has risen while the threshold stayed the same, and only 8 percent of salaried workers qualify for overtime at the current level.

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