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March 2020

Possible Relief for Small Businesses, Schools, and Nonprofits

Latta Backs Bill Providing Relief for Small Businesses, Schools, and Nonprofits

 WASHINGTON, D.C. – Wednesday evening, Congressman Bob Latta joined his colleagues in the U.S. House of Representatives to pass H.R. 6094, the Regulatory Relief for Small Businesses, Schools, and Nonprofits Act, legislation that would require a six-month delay in the implementation of the new Department of Labor (DOL) overtime rule. The rule was finalized earlier this year without Congressional approval despite concerns raised by small businesses, schools, and charitable organizations.

“I’ve heard from a number of schools and nonprofits in the Fifth District that simply don’t know how they will be able to effectively pursue their missions when this rule goes into effect,” said Latta. “Of course, small businesses will also be at a significant disadvantage and employees are going to face less scheduling flexibility and opportunities for upward mobility at work. Passing this legislation will give these organizations needed relief from a rule that was poorly thought out and finalized without any Congressional input.”

The new DOL regulation was finalized in May of this year, and will go into effect less than six months later on December 1, 2016.

The rule dramatically alters the Fair Labor Standards Act, which establishes protections for America’s workers. While the law’s intentions are important, the regulatory structure under the law is complex, outdated, and burdensome — undermining worker protections and forcing law-abiding employers to be faced with expensive litigation. Bipartisan Members of Congress, schools, nonprofits, and small businesses have asked for a measured approach be taken by the DOL to improve the law for both employers and employees.

However, the proposal by the Administration is a radical approach that does not fix underlying problems with the Fair Labor Standards Act and more than doubles the threshold of overtime eligibility from an annual salary of $23,660 to $47,476. With the increase in threshold, many employees will now face reduced scheduling flexibility as employers are forced to meticulously count employee hours. According to the National Federation of Independent Businesses, approximately 44% of small businesses will be affected by the new rule.

The DOL rule is also subject to a lawsuit filed by 21 states, including Ohio, challenging the legality of the regulation.

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