Employment Law Daily NFIB wants DOL to delay overtime rule compliance deadline for small business
Monday, September 19, 2016

NFIB wants DOL to delay overtime rule compliance deadline for small business

By Pamela Wolf, J.D. The National Federation of Independent Business (NFIB) has asked the Department of Labor to delay the compliance deadline for its final overtime rule from December 1, 2016, to June 1, 2017. The rule potentially affects 44 percent of all small employers, many of whom still don’t understand the rule, according to the NFIB, which sees the "mere 25 weeks" between the final rule’s publication on May 23 and the December 1 compliance deadline as inadequate for most small business to prepare for the new wage and hour standards. The final regulation doubles the salary threshold below which mandatory overtime would apply—moving it from its current $455 a week, or $23,660 annually, to $913 a week, or $47,476 annually. The NFIB’s research shows that nearly half of all small businesses employ at least one person who would be affected. The federation continues its opposition to the rule, with its policy team pushing for legislation to repeal it altogether. The NFIB also supports bipartisan legislation that would delay implementation. In the meantime, its objective right now is to appeal to the Department of Labor for an extension so that small businesses can comply, according to NFIB President and CEO Juanita Duggan. "In many cases, small businesses must reorganize their workforces and implement new systems for tracking hours, record keeping, and reporting," said NFIB President and CEO Juanita Duggan. "They can’t just flip a switch and be in compliance." The NFIB noted that among the roughly 5.5 million small employers in the United States, according to the Census Bureau, half employ fewer than four people. Nearly a million other businesses employ between five and 10 workers. "Large corporations with legal, financial, and personnel departments that have lawyers, accountants, and human resource specialists who routinely read the Federal Register and the Code of Federal Regulations, and who command substantial resources for analyzing the legal status of employees and making adjustments to timekeeping and payroll systems, may prove able to cope with the new Final Rule," the NFIB said in a September 13 letter to the DOL. "But the Department cannot reasonably expect America’s small businesses to match them." "The US economy is a small business economy and many of these firms don’t have the resources, the personnel, or the time to meet the deadline," said Duggan. "Beyond that, many small businesses are gearing up for the make-or-break holiday season. This is a very costly regulation that is made more damaging by the arbitrary deadline." "If the Department’s goal is to bring as many employers as possible into compliance, then it should be willing to make this modest accommodation," said Duggan. "Otherwise, many thousands of small business owners will find themselves suddenly out of compliance and in jeopardy of fines and litigation."

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