NNA opposes FLSA overtime provision

Apr 5, 2016

By Richard Karple
American PressWorks

113% increase seen as too much

WASHINGTON—Did your revenue increase by 113 percent last year? Didn’t think so.

Your lack of exponential growth didn’t stop the Department of Labor from proposing a whopping 113 percent increase in the salary threshold for workers exempt from Fair Labor Standards Act overtime rules. Unless DOL’s plans are disrupted, the minimum annual salary for “white collar” employees to qualify as exempt will soon increase from $23,660 to $50,440. That means otherwise-exempt managers who earn less than $50,440 will be converted from salaried to hourly employees and will need to start punching a clock. In addition, their employers will be required to pay them time-and-a-half for working more than 40 hours during a workweek.

The biggest problem with the proposal is that it’s a one-size-fits-all solution: The same salary threshold applies regardless of the cost of living where it is being enforced. Although a threshold of $50,440 may make sense in cities such as New York City and Washington, it’s almost certainly too high for the small towns and rural communities in which most National Newspaper Association members operate.

It’s clear by now that the new threshold will sweep up many editors, sales managers and other professional employees working for NNA-member papers. But even if you don’t have any presently exempt employees who will be affected by the increase, other businesses in your community—including your advertisers—are likely to feel the impact. 

The proposal will also hurt many of the employees it’s designed to help. In addition to requiring them to keep track of their time, it will reduce their work flexibility and opportunities for advancement. That’s because businesses that are serious about setting limits on overtime pay must prevent their employees from, for instance, reading e-mails after regular work hours or attending conferences to support their professional development.

The notion of mandating a fixed work schedule is especially noxious in our world, where we have no factory whistle to halt the production of news.

NNA submitted comments opposing the sharp increase, and we have joined a coalition of other organizations, like the Society for Human Resource Management, working to convince DOL to scale back its plans. NNA will also join the Newspaper Association of America next month in an effort to demonstrate to the Office of Management and Budget the significant financial challenges the increase will impose on the newspaper business.

But federal agencies like DOL have broad latitude in “filling in the blanks” of regulatory schemes established by Congress, and the politics on this one aren’t in our favor. Republican members are uniformly opposed to the increase, but their power to influence the Labor Department is limited. The best hope is to convince moderate Democrats to raise concerns about the proposal with the Obama administration. Bills recently introduced in Congress could serve as the legislative vehicle to express those concerns. The Protecting Workplace Advancement and Opportunity Act (S. 2702 and H.R. 4773) would require DOL to conduct more research on the impact of the increase before issuing a final rule.

If you are concerned about this vast expansion of mandatory overtime, now is the time to let your representatives know. DOL is barreling ahead and appears intent on pushing its proposal through as quickly as the federal rules governing the regulatory process will allow. All signs point to the rule being finalized in mid-May, at the latest. Once it is published, businesses will have as little as 60 days to comply.

Nobody is denying that it was time to raise the minimum salary level. It was last increased in 2004, and $23,660 is probably too low in any region of the U.S. But swelling the threshold by 113 percent after a period of prolonged economic weakness is a prescription for chaos.