PA Chamber warns of negative consequences of revised overtime eligibility rule

Pennsylvania Chamber of Business and Industry President and CEO Gene Barr issued a statement Jan. 31 expressing disappointment over the Independent Regulatory Review Commissions’ decision to advance a proposal by the Department of Labor & Industry for expanding overtime eligibility rules in Pennsylvania.

“We are disappointed by the Independent Regulatory Review Commission’s decision to move forward with the overtime eligibility rule change,” Barr said. “In 2018, during the initial phase of the review process, hundreds of opposition comments were submitted from a wide range of stakeholders – including nonprofits, higher education, local governments, small businesses among many others who described unsustainable cost increases and harm to workplace morale as employees are forced to be shifted from guaranteed salaries to hourly clock-in, clock-out positions. Many of these concerns were echoed by IRRC, which directed the Department to re-engage with stakeholders and submit a revised proposal for consideration.”

The new rules would require employers to provide overtime pay to most full-time salaried workers in executive, administrative and professional jobs making less than $45,500 by 2022. This increase would be phased in over three steps in 2020, 2021, and 2022. The salary threshold would adjust automatically every three years, starting in 2023.

The final regulation requires approval from the Attorney General before it can be published in the Pennsylvania Bulletin and go into effect later this year.

“Unfortunately, the proposal approved today is only minimally different from the Department’s initial proposal and largely disregards the concerns raised by stakeholders,” Barr said. “We urge the General Assembly to consider the true impact of this proposal and for each legislative chamber to issue disapproval resolutions rejecting the change.”

According to the Gov. Tom Wolf, the proposal would extend overtime pay eligibility to 82,000 more workers.

“This is an important victory for thousands of workers,” Wolf said. “People who work overtime should be paid for it. This is absolutely the right thing to do. Today’s approval of my plan will modernize our outdated overtime rules so more people are eligible for time-and-a-half pay. This will put more money in the pockets of workers and strengthen the middle class.”