Stalled Overtime Rules Will Hurt All U.S. Workers, Including Trump Voters

January 19, 2017

President-elect Trump rode a wave of American worker discontent all the way to the White House. A frequent refrain during his boisterous campaign rallies was that a Trump presidency would “make America great again” by bringing back well-paying jobs.

If the incoming president is serious about his pledge to workers, he should support the Department of Labor’s (“DOL’s”) effort to preserve its new overtime rules. The rules, which were supposed to take effect on December 1, 2016, would have significantly increased the number of workers eligible for overtime – an estimated 4.2 million American workers would have benefited. The rules were blocked by a federal judge in Texas in connection with a lawsuit brought by 21 states to stop the changes.

The initial signs do not look promising. Trump’s nominee for Secretary of Labor, for example, is Andrew Puzder, a fast-forod industry executive and fierce opponent of employees’ rights, including the minimum wage. He has also criticized the DOL overtime changes.

Trump, however, owes his election win to ordinary American workers – the same group that stands to benefit most from the updated overtime rule. Under the new overtime rules, all employees who earn less than $970 a week will be eligible for overtime – that number was just $455 a week under the old rules. The salary threshold would also be adjusted every three years to reflect inflation.

A federal overtime statute that reflects the actual wages of American workers is a huge step forward. It ensures they benefit from contributing to the success of their employers through their hard work and dedication.

The impact on the average American’s wallet is also substantial. According to the DOL, the updated overtime rules will put $1.2 billion more each year into the hands of employees across the country. This a significant sum that will also directly contribute to the health of the U.S. economy. More money circulating among consumers drives growth.

Notably, the positive impact will be felt very strongly in states that Trump and his fellow Republicans snatched from Democrats in the 2016 election – propelling them to victory. Wisconsin, for example, will see 69,000 more workers protected, with $29.8 million added to the state’s payrolls. The gains are even more significant in Michigan (101,000; $34.8 million), Pennsylvania (185,000; $49.6 million) and Florida (331,000; $74.2 million).

Workers in traditional “red” states will also benefit significantly. In Texas, where a court has blocked the overtime rules, 370,000 workers would now qualify for overtime pay, adding $105.8 million to their collective pocketbooks. The same holds true for Alabama (60,000; $19 million), North Carolina (156,000; $50.8 million), and Georgia (158,000; $39.6 million).

The very same voters that put Trump in the White House – and gave House and Senate majorities to the Republicans – will be direct beneficiaries of the updated rules.

President-elect Trump would be wise to take note of the direct impact that the rules will have on the people who put him in office. If he is serious about lifting up American workers, one of his first acts should be to put his full support behind the changes and take every step necessary to ensure they take effect.

That will be a true sign the Trump presidency intends to make America great place to work again.

Employee rights, workplace fairness, and just compensation are of critical concern to the attorneys at Outten & Golden. We will continue to monitor and report on the developments surrounding the overtime rule changes.

(*Prior results do not guarantee a similar outcome.)