A major national manufacturing association has come out against the Obama administration’s new overtime regulation.
The National Association of Manufacturers (NAM) released a statement from Vice President of Labor, Legal and Regulatory Policy Rosario Palmieri declaring the final overtime regulation “creates barriers to opportunity, severely limiting flexibility and dramatically increasing red tape, especially for small manufacturers who cannot afford the burdens of a 99% salary increase for management employees who are exempt from overtime pay.”
Palmeri continued: “Even worse, the administration has also required there to be future automatic increases, which creates uncertainty in planning for future years.”
NAM’s position is that the regulation hinders the transition from entry-level to management roles within manufacturing and what the administration paints as a pay raise for millions of workers could limit those options for many who strive to be part of management.
“Time and resources that could be spent on creating jobs and opportunity will now be used in efforts to comply with this rule,” Palmieri warned. “Unfortunately, this is just the latest in what has been a deluge of regulations from this administration that are fundamentally altering the manufacturing workforce and negatively impacting companies and business owners.”
He added: “If the goal is to fatigue manufacturers and create disincentives to opportunity, then mission accomplished. But if the goal is to enhance our modern workplaces, the administration should work with manufacturers and recognize our unique advantages.”
The new overtime regulation will raise the salary threshold indicating eligibility from $455/week to $913 ($47,476 per year), which could affect 4.2 million workers. It will automatically update the salary threshold every three years, based on wage growth over time, increasing predictability. Lastly, it promises to strengthen overtime protections for salaried workers already entitled to overtime and provide greater clarity for workers and employers.
The rule becomes effective Dec. 1, 2016.