Getting Rid Of Overtime
Project 2025 - The Gift That Keeps On Giving
I am sure MAGA followers are not aware that their leadership wants to get rid of overtime all in the name of worker freedom and flexibility.
On page 592, Project 2025 lays this all out in very flowery, rather worker centric language.
Overtime Pay Threshold. Overtime pay is one of the most challenging aspects of the Fair Labor Standards Act rules. “Nonexempt workers” (e.g., workers whose job duties fall within the law’s power or whose total pay is low enough) must be paid overtime (150 percent of the “regular rate”) for every hour over 40 in a work-week. Overtime requirements may discourage employers from offering certain fringe benefits such as reimbursement for education, childcare, or even free meals because the benefits’ value may be included in the “regular rate” that must be paid at 150 percent for all overtime hours. And because some of these fringe benefits may be more valuable (and often come with tax preferences that benefit the worker), the goal should be to set a threshold to ensure lower-income workers have the protections of overtime pay without discouraging employers from offering these benefits.
DOL should maintain an overtime threshold that does not punish businesses in lower-cost regions (e.g., the southeast United States). The Trump-era threshold is high enough to capture most line workers in lower-cost regions. One possibility to consider (likely requiring congressional action) would be to automatically update the thresholds every five years using the Personal Consumption Expenditures (PCE) as an inflation adjustment. This could reduce the likelihood of a future Administration attempting to make significant changes but would also impose more adjustments on businesses as those automatic increases take hold.
Congress should clarify that the “regular rate” for overtime pay is based on the salary paid rather than all benefits provided. This would enable employers to offer additional benefits to employees without fear that those benefits would dramatically increase overtime pay.
Congress should provide flexibility to employers and employees to calculate the overtime period over a longer number of weeks. Specifically, employers and employees should be able to set a two- or four-week period over which to calculate overtime. This would give workers greater flexibility to work more hours in one week and fewer hours in the next and would not require the employer to pay them more for that same total number of hours of work during the entire period.
Sounds great does it not? You are going to get greater flexibility in how you work and gain better benefits.
Except for one little issue. For non-exempt workers, the world does not work that way and never has worked that way. Anyone that has ever worked an hourly paid job knows that they are under a very watchful eye by management. From management’s perspective, non-exempt workers cannot be trusted with work freedom. Yet, all of a sudden, management is going to allow such freedom? In whose fever dream was this a good idea? Particularly from a group that views workers as little more than surfs to be used and abused.
I can tell you exactly what will happen if this ever gets enacted. The system will be set up such that overtime pay gets reduced to nothing and that time off promised never shows up. Why? Because, employers will be on a 160 hour schedule (anyone that thinks they will go any less than that has their head up their butt). In order to get overtime, the worker will need to work more than 160 hours in four weeks. What will happen is that a worker will be scheduled to work, for example; 55 hours in week one, 25 hours in week two, 45 hours in week three, and 35 hours in week four, for a total of 160 hours. There will be no granting of 20 hours of extra time off because the worker is required to work a total of 160 hours in the four week period. Best of all for the employer, no 20 hours at time and a half.
Oh, and if you think unionizing will address this imbalance, think again. Project 2025 rambles on and on about how unions have destroyed the government as well as businesses. This is a topic for a future post, but you can start filling yourself in by going to page 599 and begin reading about how unions will be targeted so that workers have no control or say.
Welcome to that better world!