Ask someone making as little as $155 a week if they are an executive and you would likely be met with a blank stare or laughter. As crazy as it sounds, such an individual could be classified as an “executive” under current federal wage-hour law and not be entitled to overtime pay. It underscores the importance of a current U.S. Department of Labor initiative to update its half-century-old regulations and recognize the realities of today’s workplace.
Modernizing an old law would seem to make sense. Unfortunately, however, there is an attempt under way in Congress to stall these sorely needed revisions because of unfounded fears that some workers might lose entitlement to overtime pay. In reality, approximately 1.3 million more workers will gain the right to overtime pay, according to a DOL analysis.
The DOL’s regulations haven’t been updated for decades. As a result, small employers trying to comply with the law struggle to interpret and apply to today’s workplace antiquated regulations that describe jobs and duties that no longer exist.
Few people know this problem better than small business owners. That’s why thousands of them are applauding the DOL’s effort.
In essence, the proposal would update and streamline the criteria used for determining exempt/nonexempt (salaried/hourly) status by replacing current subjective measurements with more objective criteria that take both salary level and job duties into account. The proposed changes would establish a consistent test for employers that is easily understood and applied, and more in line with what Congress intended as a “white-collar” exemption.
Members of the Maine congressional delegation will play a key role in determining whether that attempt is successful. We hope they will be sensitive to the plight of small business owners and recognize the need for fixing the outdated regulations.
David R. Clough
National Federation of Independent Business