H.R. 6094, Regulatory Relief for Small Businesses, Schools, and Nonprofits Act

H.R. 6094

Regulatory Relief for Small Businesses, Schools, and Nonprofits Act

Date
September 28, 2016 (114th Congress, 2nd Session)

Staff Contact
Communications

Floor Situation

On­­­­ Wednesday, September 28, 2016, the House will begin consideration of H.R. 6094, the Regulatory Relief for Small Businesses, Schools, and Nonprofits Act, under a closed rule. H.R. 6094 was introduced on September 21, 2016, by Rep. Tim Walberg (R-MI) and referred to the Committee on Education and the Workforce.

Bill Summary

H.R. 6094 provides a six month delay in the effective date for the Department of Labor’s overtime pay rule.

Background

In 2014, the Administration began an effort to update the rules surrounding federal wage and hour standards. In May 2016, a final rule updating overtime pay protections was released. The rule updates the salary and compensation levels needed for executive, administrative, and professional workers to be exempt from overtime pay. Specifically, the final rule sets the standard salary level at $913 per week, up from $455; sets the total annual compensation requirement for highly compensated employees at $134,004 annually, up from $100,000; and establishes a mechanism for automatically updating the salary and compensation levels every three years. Additionally, the final rule amends the basis test to allow employers to use nondiscretionary bonuses and incentive payments, including commissions, to satisfy up to 10% of the new standard salary level. The rule takes effect December 1, 2016.[1]

According to the Education and Workforce Committee, this rule will do more harm to American workers. Specifically, the overtime rule would stifle flexibility in the workplace. Salaried employees would be forced to clock in and out of work, limiting a flexible work environment that allows them to balance work and personal obligations. In addition, the rule limits opportunities to move up the ladder in the workplace. Employees shifted from a salaried position to an hourly one will see fewer opportunities for on-the-job training, career development, and managerial experience. Small businesses will be faced with increased costs and a complicated regulatory scheme, while America’s colleges and universities will face higher operating costs causing tuition to increase. Finally, nonprofits will have to scale back services in communities due increased overhead. [2]

According to the bill sponsor, “In the 21st century workplace, we need to encourage policies that increase flexibility, reduce regulatory burdens, and create more opportunities for workers to pursue their dreams. Our nation’s outdated overtime rules are in need of modernization, but it must be done in a responsible way that doesn’t stifle opportunities for working families to get ahead. Unfortunately, the administration’s overtime proposal fails this test and should be sent back to the drawing board.”[3]

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[1] See Department of Labor Wage and House Division Final Rule:Overtime
[2] See Committee on Education and the Workforce Press Release, May 24, 2016.
[3] See Rep. Walberg’s Press Release

Cost

A Congressional Budget Office (CBO) cost estimate is currently unavailable.

Additional Information

For questions or further information please contact Jake Vreeburg with the House Republican Policy Committee by email or at 5-0190.