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Troubled by the new overtime rule?

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By now you likely have heard of the U.S. Department of Labor’s action this week to reclassify millions of formerly exempt employees to non-exempt status. The DOL’s new rule requires employers to pay overtime to salaried managers who earn less than $47,500 per year, doubling the previous threshold of $23,660. Labor Secretary Tom Perez is promoting it as a means to increase middle-class wages, claiming “the overtime rule could … help millions of workers get back into the middle class.”

This logic reflects a fundamental lack of understanding of how jobs are created and what leads to wage growth and upward mobility for workers. The sad reality is any public policy based on this understanding of economics actually has the opposite effect: It will lead to fewer jobs and lower wages for far too many American workers.

The vision statement of the Springfield Area Chamber of Commerce is “to foster a culture and climate of opportunity through robust economic growth and dynamic job creation.” In our 2016 Strategic Action Plan, we recognize that our members and our community rightly expect us to fill several specific roles in fostering that culture and climate. Two of them are especially relevant here: Representative Voice and Reliable Source.

Your Representative Voice (Advancing the perspective of job creators)

In the months preceding Wednesday’s DOL announcement and the days since, the Chamber has worked hard to serve as our members’ voice on this deeply impactful concern. Our 2016 Federal Legislative Agenda, adopted in December 2015, identifies and opposes the DOL’s action.

The Chamber is advancing the perspective of job creators while explaining the dynamics necessary for job creation and wage growth--and how this DOL action undermines both.

  • Springfield News-Leader, May 20 – David Mitchell, director of the Bureau of Economic Research at Missouri State University, and I make the economic impact case.
  • KRBK Fox 5, May 18 – Chamber member Krystal Russell and I share the impact on business and why the logic of the regulation is flawed.
  • Springfield News-Leader, May 22 – my opinion piece on this regulatory action vs. the proven way wages actually increase.
  • Springfield Business Journal, May 24 – my opinion piece on the business impact of this new rule.
  • Review the Chamber’s Legislative Agenda to see the issue in context of our priorities.

Several legislative fixes are in the works as well (contact Sen. Roy Blunt, Sen. Claire McCaskill or Rep. Billy Long):

  • Protecting Workplace Advancement and Opportunity Act (H.R. 4773 and S. 2707)
  • S. 1067, The Regulatory Review and Sunset Act (sponsored by Sen. Blunt)
  • The Regulations from the Executive in Need of Scrutiny (REINS) Act (H.R. 427 and S. 226)
  • The Regulatory Improvement Act (S. 708)

Your Reliable Source (Preparing members for the challenges ahead)
Even as the Chamber represents our members in the community and with policymakers, we know the importance of preparing and equipping our members to function under the new rule. That work already has begun:

Stay tuned—we won’t leave you to fend for yourself on this! As always, I welcome your comments.

Sincerely,
Matt Morrow
President, Springfield Area Chamber of Commerce

Supported by BKD CPAs & Advisors
Supported by BKD CPAs & Advisors
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