New overtime rules enacted by the Obama administration will have harmful consequences for small businesses and charities.
The change makes all salaried employees making $47,476 annually eligible for overtime pay if they work more than 40 hours a week. This will lead employers to limit workers’ base salaries, more closely monitor employee work, and limit flexible work schedules, Heritage’s James Sherk predicts.
This isn’t just a prediction — real people are affected. Michigan business owner Rodney Kloha tells Heritage’s Daily Signal that he may “lose a guy who said he’s worked too many years to go back to being an hourly person”:
I’m in Michigan. It’s a rural area. We have [industry] and everything, but it’s not urbanized like Washington, D.C., or New York City. Salaries in the range of 35, 40, $50,000 are good wages. With my salaried people, we have an agreement that we come together on what the salary is and what’s expected to do the job. I don’t abuse them, and they don’t abuse their salaried position. My employees are seeing [the switch to hourly] as a demotion.
Do you think the government should force companies to treat salaried workers like hourly employees?