Bush Rules Could Cost 6 Million Workers Overtime Pay                       HOME

July 14: At least  6 million workers will lose their right to overtime pay under final Bush administration rules scheduled to take effect Aug. 23, according to a new Economic Policy Institute (EPI) analysis released July 14, one day after former high-ranking Labor Department officials reported that the new overtime rules will substantially erode the overtime rights of America's workers.

"It's hard to take the administration's claims of wanting to help workers seriously, when those who will lose outnumber those who will be helped by 16 to one says EPI Vice President Ross Eisenbrey, author of the report Longer Hours, Less Pay.

The Bush administration's changes to the Fair Labor Standards Act (FLSA) would establish new rules for employers to determine if workers are eligible for overtime pay. When the proposed rules were announced last year, the Bush administration claimed it was streamlining the overtime regulations and expanding the number of workers eligible for overtime pay. But workers, their unions and other groups charged the move would deny millions of workers their overtime pay.

Under the new rules, workers who earn as little as $23,660 per year about $5,000 above the poverty line for a family of four could see their jobs reclassified as ineligible for overtime pay.

The rules changes will affect workers throughout the economy. For example, as many as 2 million administrative workers will lose their overtime rights under a rule change that makes "team leaders" ineligible for overtime pay, even when they do not supervise others on the team, the EPI report says.

The new rules also will end overtime eligibility for some 900,000 workers without college or graduate degrees who will be newly classified as exempt professionals, nearly 1.4 million workers reclassified as executives under the new rules, another 130,000 chefs, sous chefs and cooks, 160,000 financial services workers & 117,000 teachers and computer programmers, according to EPI.

Former Labor Department Officials Say Bush Overtime Pay Take-Away Will Hurt Working Families

The EPI analysis comes a day after a new report by former Department of Labor officials, which finds the Bush administration's overtime pay take-away will harm working families and take overtime pay from "large numbers" of workers.

The EPI report came on the same day House Democrats renewed their efforts to protect overtime pay. The House Appropriations subcommittee, on a party-line vote July 14, defeated 31-29 an amendment that would have required the U.S. Labor Department to implement the old overtime rules but with the new adjusted minimum salary levels. In this way, workers would be guaranteed that they would not lose overtime eligibility. Rep. David Obey (D-Wis.), who sponsored the amendment to the Labor, Health and Human Services appropriations bill, is expected to offer the amendment again on the House floor next week. A similar amendment was narrowly defeated last year in the House.

The three authors of the report released July 13 held high-level positions at the Department of Labor under both Republicans and Democrats beginning in the 1980s under President Reagan. All three dealt extensively with the FLSA and wage and hour issues during their government service.

The former Labor officials' study of the new overtime rules determined that the Bush regulation "removes existing overtime protection for large numbers of employees currently entitled to the law's protections,more classes of workers and a greater portion of the workforce will be exempt" from overtime pay protection.

Contrary to Administration Claims, Changes Will Hurt Workers

In response to the report, Sen. John Kerry (D-Mass.) charges: and "The Bush administration's new overtime regulations represent a shameful assault on the paychecks of hard-working Americans." A Kerry-Edwards administration, he says, "will waste no time in reversing this affront to millions of workers, and in restoring their fundamental right to get overtime pay whenever they work more than 40 hours a week."

Bush's Dept. of Labor claimed the new regulations would clarify overtime rules and reduce the number of lawsuits involving overtime pay disputes. But the former officials' report finds "the Department has written rules that are vague and internally inconsistent that will likely result in greater confusion and a profusion of litigation outcomes that the Department explicitly sought to avoid."

Working Families Urge Congress to Stop Bush's Overtime Pay Take-Away

Meanwhile, with the new overtime rules set to take effect in just a few short weeks, working families are boosting their campaign to stop the Bush overtime pay take-away. The proposal was announced in March 2003.

Some Republican representatives are urging Republican leaders to allow the U.S. House of Representatives to vote on legislation that would repeal any portion of the Bush administration's new rules that would take away overtime pay. In a letter to House Speaker Dennis Hastert (R-Ill.), the lawmakers say their request " is of the utmost urgency. Once the new overtime regulations take effect August 23, it may be too late to restore overtime eligibility for our constituents."

In May, the Senate approved an amendment by Sen. Tom Harkin (D-Iowa) to the Foreign Sales Corp. (FSC) tax bill (S. 1637) to protect overtime pay, but House leaders have blocked votes on a similar measure and even refused Democratic requests to allow debate on the issue. The fate of the Harkin amendment, when the FSC bill goes to a House and Senate conference committee, is unclear.

The independent experts conclude that "...implementation of these new regulations will harm rather than promote and protect the interests of U.S. workers and their families."