At the Senate Appropriations Labor, Health and Human Services, Education and Related Agencies Subcommittee hearing Tuesday on the Department of Labor’s FY18 budget request, Senator Alexander talked with Labor Secretary Alexander Acosta about the previous administration’s overtime rule. Senator Alexander has previously said the rule would “force changes in overtime pay that are too high, too fast and will result in employers, non-profits, colleges and others cutting workers’ hours, limiting their workplace benefits and flexibility, as well as costing students more in tuition.”
At Tuesday’s hearing, Senator Alexander outlined problems with the overtime rule and encouraged Secretary Acosta to rework the regulation with these considerations in mind: “I just want to give you my opinion to consider on the so-called overtime rule," said Senator Alexander. "That was a bad rule. Here are the problems with it:
"The rapid rate of increase. The salary threshold was set to double overnight. The top number was over $47,000, just too high for many parts of the country, and I think it would be wise to consider a different top level for different parts of the country.
"It caused enormous harm to non-profits especially colleges and universities who are telling me they have to raise tuition by a large amount to accommodate it.
"It included annual increases with only two months notice. Now, annual increases might be a good idea, but not with two months notice.
"So I would urge you to show us how to write a good overtime regulation as you consider this, one that takes those issues into account, and there are thousands and thousands of colleges, universities, Boy Scout troops, [and] businesses that will hope you will do the same.”
VIDEO: https://www.youtube.com/watch?v=U0MQyjV9XcM&feature=youtu.be
The final rule – which was halted by a federal court in November, before it was supposed to take effect on Dec. 1 – would have more than doubled the salary threshold under which employees qualify for overtime pay, resulting in students facing higher costs and workers having less flexibility and opportunity for advancement in the workplace. At least five independent colleges in Tennessee expected their costs to increase more than $1 million in the first year under the new rule, and several others expect costs to increase more than $600,000 in the first year. One Tennessee independent college estimated increasing annual tuition by $850 per student.
Last Congress, Senator Alexander introduced legislation similar to a bill introduced by Democratic Rep. Kurt Schrader of Oregon to change the timeline for implementing the overtime rule to stretch out over five years the increase in the salary threshold for overtime pay, which was set to double at once.
Watch this morning’s Senate Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies hearing here.