REGULATORY RELIEF FOR SMALL BUSINESSES, SCHOOLS, AND NONPROFITS ACT

September 28, 2016
Floor Statements

Mr. SCOTT of Virginia. Mr. Speaker, I stand in opposition to H.R. 6094, the inappropriately named Regulatory Relief for Small Businesses, Schools, and Nonprofits Act.

   First of all, it is not limited to those. It is for all employers. It would delay the implementation of the overtime rule for 6 months. The rule is currently slated to go into effect on December 1, and working families can't wait another 6 months for a long-overdue adjustment in the overtime rule.

   We ought to talk a little bit about what we are talking about. If today you are earning $10 an hour, if you work more than 40 hours a week, you get time-and-a-half for every hour worked over 40. And if they change that to the same amount, instead of $10 an hour, $20,000 a year, you still get time-and-a-half for overtime after 40 hours because your salary is under the approximately $23,000 threshold.

   If you make $15 an hour, you get time-and-a-half for over 40 hours; but if they change that and call it $30,000 a year, the hours you work over 40 you not only don't get time-and-a-half, you don't get paid at all. You just worked extra hours because you are over the threshold.

   Now, when the threshold was established many years ago, 60 percent of salaried workers were covered by the overtime rule. They were under the threshold and got overtime. But because it wasn't adjusted for inflation, it is now only about 7 percent of salaried workers who get overtime protection. The Department of Labor overtime rule will increase that threshold up to about $47,000, and this would cover about only 35 percent of salaried workers, but this would still enable millions of Americans to be compensated for work over 40 hours.

   Mr. Speaker, the 40-hour workweek used to be the standard workweek, but with this new rule, more workers will benefit from the overtime rule and be able to get time-and-a-half for hours worked over 40 hours. We have heard this is too quick. When the last adjustment was made, under a Republican President, only 4 months were provided to adjust. This rule allowed 6 months. Furthermore, the administration has been working on this for 2 years, so employers have known it was coming.

   Now, we will hear exaggerated reports about the impact on universities. Studies have shown that only a few people will be actually affected by the rule, and of those, only a few people will actually routinely work overtime. So the total of those affected and routinely work overtime is about 1 percent of the university employees. Their salary may go up a little bit or they may be only worked 40 hours, in which case there is no adjustment needed. Either way, you are only talking about a small portion of the salary of 1 percent. That is not going to bankrupt universities.

   The nonprofits, the same thing, about 1 percent of the employees both routinely work overtime and are affected. Their salary may or may not go up, depending on how you respond because a lot of times you will just make sure that people don't work more than 40 hours a week. They can go home to their families rather than be worked hour after hour after hour.

   We have also heard an exaggeration about how it will affect jobs, people will have to lay people off. Actually, one study showed that you will actually create jobs, about 100,000 jobs over the economy, because if an employer has 120 hours that need to be worked, and he is working two people 60 hours a week without paying for the extra hours, with this rule, he may be paying them time-and-a-half, and it may make more sense to hire a third person; so three people work 40 hours a week. That would create, as I said, about 100,000 jobs.

   Mr. Speaker, this bill would unnecessarily delay fair pay to millions of workers. The President, thankfully, has said that if this bill ever sees his desk, he will veto it. We can remove that uncertainty just by defeating the bill here and now.