U.S. Department of Labor Overtime Rule Will Hurt Businesses

7768406In 2014, President Obama directed the U.S. Department of Labor (DOL) to update and modernize rules regulating exemption of certain employees from minimum wage and overtime protection provisions of the Fair Labor Standards Act. Just a few weeks ago, the U.S. DOL released regulations regarding new rules for overtime. This action drastically increases the salary threshold under which most employees would be eligible for overtime pay, from $23,660 for a full-time employee to $47,476 per year. This will affect millions of middle-wage employers across the country.

In addition to this increase in salary threshold, an automatic adjustment will occur every three years. Also, the “duties test” that determines whether or not certain employees are eligible for overtime even if they make more than the new threshold amount will continue. To be eligible for this exemption, an employee’s job duties must primarily involve executive, administrative or professional duties as outlined by DOL regulations. The change is set to go into effect on December 1 of this year. (See DOL fact sheet.)

Obviously, this has drastic implications for the employer community. According to the Washington Post, about 35% of full-time salaried employees will be eligible for time and a half when they work extra hours under the new rule. Under an already existing rule, that number was 7%. As such, employers will have less flexibility in documenting time for their workers – including flex time – or may have to cut back hours for certain employees. This can hamper employers being able to reinvest in their companies, as well as provide better benefits and growth opportunities. Small businesses will be even more impacted by this onerous rule.

The Indiana Chamber, in conjunction with the U.S. Chamber, is reaching out to the Indiana delegation in Washington, D.C. to let them know how this will impact the business community. We encourage you to participate in this call to action.

The 2016 Indiana Wage and Hour Seminar on July 28 will include a detailed discussion on the impacts on employers.

Why We Love Manufacturing Day

N“Every dollar spent in manufacturing generates $1.32 for the economy.” – U.S. Chamber

Friday, October 3 was National Manufacturing Day (MFG Day), a celebration of an industry often taken for granted in the U.S., an industry that is struggling to find talent, and an industry that has a significant economic impact on Indiana, the nation and the world.

MFG Day addresses common misperceptions about the industry by giving manufacturers an opportunity to open their doors and show, in a coordinated effort, what manufacturing is — and what it isn’t. There were 1,647 MFG Day events throughout the U.S. and Canada (even Puerto Rico!) and some that will continue through October, November and December.

There were 71 events in Indiana alone in every region of the state. 3D Parts Manufacturing, LLC in Indianapolis showed guests 3D printing in action. Amatrol in Jeffersonville offered five tours of their facility. Blackford High School students in Huntington had the opportunity to tour Mayco International, Reflective Industries and Tru-Form Steel and Wire. Caltherm partnered with Columbus North High School for presentations and a facility tour, then allowed freshman to create academic plans with assistance from their guidance counselors based on what they learned. The EDC of Wayne County showed the “American Made Movie,” followed by a tour of Colorbox with students, business and community leaders.

The U.S. Department of Labor said manufacturers have added more than 700,000 jobs since early 2010, jobs with an average salary of $77,000.

Indiana has seen its own economic development success in the manufacturing industry. Indiana leads the nation in manufacturing job growth over the last year with 20,000+ jobs created. Indiana has also added the second most manufacturing jobs (+84,100) in the U.S. since July 2009, at a rate that also ranks second in nation (+19.7%).