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Missouri employers criticize “false hope” of new overtime levels

While the Obama administration calls its recent announcement on overtime wages its “most prominent initiative to lift middle-class wages”, Missouri-based association executives, both for-profit and non-profit, say the new guidelines offer only false hope.

According to the Washington Post, about 35% of full-time salaried workers “will be eligible for time and a half” in hourly pay, which is up “significantly” from the 7% who qualify “under the current threshold.” The rule expands the ranks of overtime-eligible employees to those who earn up to $47,476 annually, when they work more than 40 hours during a week. They must also work for employers that are subject to the overtime regulations as some employers are exempt.

Pundits say the new rules were put into place in time to help Democratic politicians ahead of November elections by making stagnant American wages a major campaign issue in the 2016 election.

David Overfelt of the Missouri Retail Association, speaking during a conference call Thursday, said the new guidelines will result in higher salaried workers being reclassified to hourly workers, and hourly workers will see their hours cut along with benefits. In some cases, it may cost jobs.

“The business community is not going to be able to just absorb this and send it on down the line to consumers,” said Overfelt. “This is a huge increase and will do nothing to help the American wage earner.”

Directors of non-profit groups say their operations will be severely hit as well by the new overtime guidelines. Joy Krieger, Executive Director of the Asthma Allergy Federation of America in St. Louis says the new rule will limit the kind and number of workers she can employ.

“People do not work in the non-profit sector because of the money,” said Krieger during the conference call arranged by the Partnership to Protect Workplace Opportunity. “We work long hours because of the love we have for the cause. It will impact the level of services we give.”

“I wouldn’t be able to raise the salaries of my employees, they’d have to go to part time, or we’d have to come up with another solution, but it wouldn’t raise the salaries on the non-profit level,” said Kreiger.

And Overfelt agreed. Employers, he said, can’t artificially increase salaries just because the government mandates a scheme that it believes will result in that outcome.

“It’s a false promise,” said Overfelt.

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