Lawmakers Move Against New Overtime Rule

WASHINGTON, D.C. — Three weeks after a new federal overtime rule was approved, several legislators are attempting to block the measure.

On June 7, Sen. Lamar Alexander (R-Tenn.), chairman of the Senate labor committee, and Sen. Ron Johnson (R-Wis.), chairman of the Homeland Security and Governmental Affairs committee, introduced legislation under the Congressional Review Act to block implementation of the administration's overtime rule, which the lawmakers refer to as the "time card rule."

The new rule would lead to workers punching the clock when they come and go from work, and unable to negotiate a flexible work arrangement, according to the senators, who were joined by 44 other legislators as co-sponsors of the legislation.

In 2015, the Department of Labor released a proposal to increase the salary threshold under which employees qualify for overtime pay. The department's final rule released last month more than doubles that salary threshold from $23,660 to $47,476.

The Congressional Review Act legislation introduced by Sens. Alexander and Johnson would nullify the administration's final rule if passed, and prohibit the administration from issuing a substantially similar rule without congressional approval.

"There is no question this rule also hurts those American workers it's intended to help, through reductions in their hours and diminished workplace flexibility," Alexander said. "Workers who today are mid-management or professional employees are not going to like it one bit when their employer tells them that under this new rule they're going to be punching the time-clock when they go in and out of work."

The National Retail Federation (NRF) applauded the move.

"Retailers are happy to see that our allies in Congress aren't taking their foot off the gas when it comes to trying to stop [the Department of Labor's] reckless overtime rules from going into effect," said NRF's Senior Vice President for Government Relations David French. "Under the leadership of Sen. Alexander, 44 senators went on record earlier this week in opposing this rule, which the senator rightly observed would be better named the timecard rule or the higher tuition rule for its real-world impact on the American people."

According to NRF, its research shows that the rule will force employers to limit hours or cut base pay in order to make up for the added payroll costs of overtime expansion, leaving most workers with no increase in take-home pay despite added administrative costs. 

A separate survey found that the majority of retail managers and assistant managers the new regulations are supposed to help oppose the plan, the organization added.

"Retailers large and small agree with nonprofit organizations, higher education institutions, municipal and county governments, and other employers that overtime eligibility will not suddenly lead to overtime pay. Instead, by direction of the Labor Department, we will be forced align our workforce to limit overtime pay in ways that undermine career opportunities and better futures for both retail associates and retail companies."

The Retail Industry Leaders Association (RILA) also spoke in favor of legislative action. 

"Retailers applaud Sen. Alexander for his commitment to protecting workers from this harmful rule," said Jennifer Safavian, RILA's executive vice president for government affairs. "By making such dramatic changes to how employees are classified, the Department of Labor is hurting those that it claims it is trying to help. For retail employees, the changes will force countless employees to be reclassified from salaried to hourly, robbing them of the flexibility and upward mobility they currently value."