NAHB today blasted the Department of Labor (DOL) after it issued its final overtime rule, stating that the regulation will hurt the workers it is intended to help while also causing major harm to the nation’s small business owners.
In a hard-hitting official statement, NAHB Chairman Ed Brady said:
“The sheer arrogance displayed by the Department of Labor in failing to heed the concerns of the nation’s small business community will result in severe repercussions that will harm workers, small businesses, housing affordability, job growth and the economy.
“By radically doubling the current overtime salary limit of $23,660 to $47,476, this blatant regulatory overreach will essentially hurt many of the workers the rule was meant to help. Small business owners across the land, including the vast majority of home building firms, will be forced to scale back on pay and benefits, as well as cutting workers’ hours in order to avoid overtime requirements and remain in business.
“Congress can play a constructive role by moving quickly to pass the Protecting Workplace Advancement and Opportunity Act (House bill H.R. 4773 and Senate bill S. 2707), legislation that would force the agency to withdraw this rule until it has considered the effects it would have on small businesses, consumers, workers and the economy.”
The rule, which will take effect Dec. 1, indexes the salary threshold to inflation every three years, forcing employers to go through this process on an ongoing basis. Moreover, the huge spike in the overtime threshold could force many employers to convert salaried employees to hourly workers in order to remain solvent. These workers could wind up earning less money than they were making previously, and lose the workplace flexibility that comes with being a salaried employee..
This 100% increase to the salary threshold for overtime eligibility will hit the home building industry particularly hard and harm housing affordability. It will reduce job-advancement opportunities and the hours of full-time construction supervisors, leading to construction delays, increased costs and less affordable housing options for consumers. NAHB estimates more than 96,000 construction supervisors would become overtime eligible under this rule.
“Given the huge economic disruption this rule will cause, the Department of Labor needs to start over and produce a sensible plan that will gradually raise the overtime threshold from its current rate and properly take into account the regional variations in wages and cost of living,” said Brady.