Don’t raze the middle class raise

This election season has been focused on the American worker, and nothing says thank you like the promise of a raise. The U.S. Department of Labor recently made such a commitment by finalizing its new overtime rule, which could boost the income of more than 4 million workers by making them eligible for overtime if they make less than $47,476 a year. 

But the new rule is already under full-throttle attack. Just this week 21 states sued the Department of Labor to invalidate the rule. They claim that the rule is unconstitutional and exceeded the Department of Labor’s power. 

{mosads}And this year Republicans in the House and Senate introduced the euphemistically-titled “Protecting Workplace Advancement and Opportunity Act,” legislation that seeks to nullify the rule altogether. 

Even some Democrats have joined the opposition. Rep. Kurt Schrader recently introduced a bill to delay full implementation of the rule for years.

Donald Trump has also announced his intention to roll the rule back.

But the new rule is long overdue: middle class American wages have been stagnating for years. While wages of the top one percent grew by 138 percent from 1979 to 2013, wages of the bottom 90 percent grew by only 15 percent. Meanwhile, worker productivity has increased by 74 percent since 1973, far more than the average increase in wages for workers over the same time period. 

Before the Department of Labor’s new rule, individuals making as little as $23,660—an amount below the current poverty line—could be classified as exempt employee and receive no overtime pay. These exempt-classified workers are paid the same salary regardless of how many hours they work each week, be it 25 hours or 60. Now workers must be paid at least $47,476 a year before they can be properly classified as exempt from overtime benefits.

Those trying to overturn the rule are not listening to the numerous American workers wrote to the Department of Labor about how the new rule will affect them. 

One neuroscience postdoctoral researcher at the University of Maryland described working more than 80 hours a week at less than $10 an hour – conditions that he said are driving bright doctoral students away from scientific research. 

And a store manager who lives in New York City reported living paycheck to paycheck due to the low pay, despite working 50 to 60 hours a week.

How did things get so bad? The salary floor for the new overtime rule has been updated only once since 1975. The new rule makes updating automatic, a provision that is under attack by proposed legislation and the recent lawsuit filed by 21 states.

Part of the problem also lies with the decline in collective bargaining. When Congress first implemented the Fair Labor Standards Act, the federal law governing overtime, proponents of the bill viewed it as a bare minimum for workers’ wages and hours. Collective bargaining was always intended to play a significant role in establishing higher wages.

Historically, it has. According to the Economic Policy Institute, collective bargaining routinely increases worker pay by 13 to 14 percent overall. Unionized workers also drive up the wages of non-unionized employees who work in unionized industries.

But only about 11 percent of workers are unionized today, down from 30 to 35 percent during the height of the labor movement in the 1950s. This makes strong labor standards more important than ever.

Many businesses flooded the Department of Labor with comments about how the new overtime rule will hurt their bottom line. They argued that the rule would cause job cuts, a reduction in benefits, and the loss of prestige for exempt workers who are reclassified as hourly employees. 

The Department of Labor concluded that these fears were overblown. Many employees who wrote the Department of Labor were not concerned about reclassification, and some business owners said that higher salaries could improve consumer spending and increase their sales.

And U.S. Secretary of Labor Thomas Perez reminded the states suing the Department of Labor that the new rule was needed “to restore the intent of the Fair Labor Standards Act,” which he called “the crown jewel of worker protections in the United States.” 

Indeed, states and legislators who remain intent on killing the new rule should heed President Franklin D. Roosevelt’s words when he first sent the Fair Labor Standards Act to the floor of the House of Representatives over 70 years ago. Roosevelt observed that goods produced under “conditions that do not meet rudimentary standards of decency” are goods that should not be sold at all. In 1938, Congress agreed and passed the Act.

The new overtime rule ensures that the middle class pay scale is anchored in 21st century standards of decency. It should take full effect. 

Valerie Brender is an attorney at Rukin Hyland Doria & Tindall and specializes in employment law.

The views expressed by authors are their own and not the views of The Hill.