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NAM Opposes Overtime Rule

The NAM is leading a coalition of business groups in advocating against a potential new overtime rule from the Department of Labor.

The background: The current overtime rule, part of the Fair Labor Standards Act, mandates that employees must receive overtime pay of at least time and a half for hours worked over 40 in a workweek.

  • However, it contains certain exemptions for white-collar workers. If an employee makes a minimum amount of money or is classified as an executive, administrator or professional, they are exempt from overtime pay.

The new rule: The new rule is expected to raise the salary threshold from the current $35,568 per year.

  • ​​​​​​​The change would potentially cause challenges for employers, as well as for employees who have worked to advance themselves away from hourly jobs and into salaried company positions, as the NAM has long argued.
  • In addition, the widespread adoption of hybrid work brought about by the pandemic “makes compliance with potential changes to the white-collar exemptions measurably more difficult,” the coalition pointed out. New regulations may force employers to restrict these work arrangements that many workers value highly.

The last word: As the coalition told the Department of Labor, “Many businesses are not well-positioned to absorb new labor costs associated with changes to the overtime pay regulations, and such changes would only exacerbate the difficulties businesses are currently facing”—including inflation, supply chain disruptions and the aftereffects of the pandemic.

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