Obama Will Unilaterally Force Private Business to Pay OT to Salaried Workers – Update

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Update: 10/13/14: The details of the bill are now revealed. The president has once again interfered with the private sector.  He has revised federal rules on overtime pay to make millions more workers eligible for extra pay when they work more than 40 hours a week. Salaried workers making as much as $50,000 will be eligible for time-and-a-half if they work overtime.

This isn’t Obama law yet.  Obama has instructed Labor Secretary Thomas E. Perez to come up with a plan that would expand the number of workers eligible for overtime pay. There will be a period of public comment in which business leaders will undoubtedly weigh in.

This is another unilateral decision from the Imperial President. It’s that pen and phone again.

Income inequality isn’t because a worker is making $40,000 instead of $43,000. Actually, the worker will probably make less because his hours will be cut. It will also affect inflation, prices, and employment. Some businesses will fold.  Businesses are facing ObamaCare increases, minimum wage increases and now this.

This is a way to hurt non-union shops and promote unions because union shops already pay time-and-a-half.

 

Original Story: In a Marxist-style effort to buy votes for Democrats, President Obama is poised to order private businesses to pay over-time to millions more salaried workers with an executive order he will announce Thursday. It will be popular with many until they realize the detrimental effect it will have on their salaries and benefits in the long-run.

What right does he have to unilaterally tell private businesses how they can compensate employees?

The New York Times reported that Obama will direct his Labor Department to require overtime pay for millions of workers currently classified as “executive or professional” employees.

The new regulations to the 1938 Fair Labor Standards Act reportedly will mandate that businesses provide OT for those who work jobs from restaurant managers, to bank officers, to computer technicians.

Currently, businesses are prohibited from denying overtime to a salaried worker making less than $455 per week. The rules will include millions more, though we don’t know how many.

Since businesses will make up the costs, it will become a penalty paid by the middle class.

Often, salaried workers don’t receive overtime because they make better salaries than hourly workers. They might be people who have more responsibility and a job requiring more skills, education and expertise.

A set salary gives stability to the employee and to the employer who has to meet payroll. It needs to be left to the private businesses to decide.

In Obama’s view, this goes against his ideology that all employees must be put on the same level of compensation if necessary to reach the living wage for all. The iron law” of wages declares that wage rates are determined by the cost of the means of subsistence rather than for the skill-level of the job.

The idea of forcing employers to pay everyone by the hour risks putting everyone on the same level because employers are not going to pay higher salaries and overtime at the same time.

The problem is that it will quickly become unaffordable and salaries will be lowered for many high-level jobs. People in the middle class won’t benefit from this.

It is a ploy to get support and votes.

Additionally, it alters the very fabric of our society. He is mandating what free and private enterprise can do. He is changing the very heart of a system that has worked as people rise up the ladder in their careers. Currently, when one reaches the executive level, the person receives bonuses and a better salary – that’s about to change, probably for middle management and middle class workers. Top executives will still be safe no doubt.

Mr. Obama will have no compunctions about eventually telling employers what salaries they can pay. He tried to do it with the auto companies. He has already expressed his desire to cut bonuses and salaries for high-level executives. He believes he has the right to tell companies what they can pay certain talented professionals.

Obama is intent on changing America domestically. He has done it with ObamaCare. By requiring health insurance for workers, even for low-skilled and entry-level jobs, he has put more Americans on part-time. His demand for a $10.10 minimum wage is another vote getter but it won’t be a living wage at $10.10 an hour, it is only a play to force his version of social justice into private enterprise.

It doesn’t work and it merely brings us all down.

 

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