NFIB Warns that Overtime Rule will Increase Costs and Push Salaried Employees into Hourly Jobs

Date: May 18, 2016 Last Edit: May 19, 2016

Contact: Jack Mozloom, 202-406-4450 or 609-462-5610 (cell)

Impact will be hardest in places where the cost of living is low, says small business group

Washington, DC (May 17, 2016) — The National Federation of Independent Business (NFIB) today warned that the Department of Labor’s new overtime rule, released this evening, will mean higher costs for millions of small employers and that some salaried employees might find themselves sliding back into hourly jobs.

“Entry-level management positions are going to disappear and those employees will fall back into hourly jobs,” said NFIB President and CEO Juanita Duggan.  “Small businesses everywhere will be affected, but most of the damage will occur in places where the cost of living and the wage scale is much lower than it is in Washington, DC, or Manhattan, or San Francisco.” 

Previously, workers earning $23,660 annually were eligible for time-and-a-half for every hour they worked beyond 40 hours.  The DOL has doubled that threshold to $47,476.  According to the Obama Administration, 5 million more workers must now be paid overtime as a result. 

“Obviously that means higher labor costs for millions of small businesses regardless of whether they’re making more sales, generating more revenue, or dealing with other rising expenses,” said Duggan  “Many are struggling now, and they’ll have to make tough choices that might affect the very same workers whom the Department of Labor thinks it is helping.” 

For additional comment please contact NFIB.  Please note that members are available for comment as well.  To talk with a small business owner in your market, please give NFIB as much lead time as possible to make the arrangements.  

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