SEATTLE – Below is Rep. Pramila Jayapal’s testimony as prepared on the ‘Overtime Rule’ at the Department of Labor Wage & Hour Division’s listening session in Seattle:
Thank you to the Department of Labor for engaging in these important listening sessions and I welcome my esteemed colleague from California, Representative Mark Takano, to Seattle and I thank him for being a steadfast champion on this issue. Most of all, I thank the workers who have come together today to demand fair pay for their work.
Workers are the backbone of our communities and our country. Without them, there would be no economy. And yet, too often, millions of workers are taken advantage of, and forced to work well beyond a 40 hour workweek without any overtime pay. That is why it is so important that the Department of Labor support and improve upon the 2016 Executive, Administrative and Professional Overtime Exemptions rule, rather than eroding the rights and progress that was thoughtfully developed under the Obama Administration. This must simply be a starting point.
When the rule increased the annual salary threshold from $23,660 to $47,476, it provided overtime pay to millions of low- and low-middle-income working Americans, the bedrock and the center of our country. Prior to that time, just imagine that the salary threshold was adjusted only once in the past 40 years and that was not a full inflation adjustment. In today’s dollars, that 1975 threshold would have been equivalent to more than $50,000. Back in 1975, more than 62 percent of salaries full-time workers in the US fell under the threshold but in 2016, less than seven percent of workers did. The current threshold of $23,660 is below the poverty line for a family of four, and with rising costs for workers, it is impossible for families to make ends meet. It is simply not right to ask people to work enormous overtime hours without pay, and it is hard to imagine that people earning poverty wages can legitimately be called executives or administrators who have meaningful bargaining power and can legitimately be exempted from overtime protection.
Under the 2016 rule, more than 230,000 Washingtonians would have received new or strengthened rights. We cannot backslide on this on these promises. Without this expanded threshold to at least the levels set by the 2016 rule, Washington state workers will lose out on more than $25 million annually, and workers nationally would see a loss of $1.2 billion each year. This is money that can and should be reinvested into our communities. It is money that was earned through hard work, and these workers have every right to it.
Moving forward with this rule and indexing changes to the overtime exemption threshold to wage changes is the best way to ensure that we don’t leave workers behind in the future. By implementing the common-sense processes included in the 2016 rule, employers will not face such large jumps or policy changes, but will instead gain predictability through incremental changes. Along the same line, workers will benefit from knowing that they can continue to make ends meet and receive fair pay for their work. What we have seen is that, despite the legal challenges to the rule and this administration’s comments on the issue, many employers committed to complying with the law even before it was slated to go into effect—and it has not affected their ability to still run profitable businesses. Quite the opposite. According to DOL, the cost to employers would be less than one tenth of one percent of total U.S. payroll costs.
We cannot allow corporate interests and greed get in the way of what is right. Updating overtime exemptions represents not only what is right, but also what is popular. A 2016 poll conducted by the National Employment Law Project found that more than three quarters of Americans in key battleground states support at least moving to the levels set by the 2016 rule. But, in fact, a previous poll by Public Policy Polling found that 65 percent of Americans support an even higher threshold of $75 thousand. We must also look at addressing discriminatory exemptions for farm workers and domestic workers, who often work long hours and are undercompensated for their work based on entrenched prejudice in our outdated labor laws.
If we want to build our economy, we need to support workers. And when we increase the wages of too many low-wage workers across our country, it’s not only the right thing to do, it actually will grow our economy to put money in their pockets—which will ultimately go right back into our economy again.
Thank you again for conducting these listening sessions, and I urge you to protect and advance the 2016 rule.