WASHINGTON – Labor Secretary Elaine Chao (search) told Congress on Wednesday that new overtime regulations (search) would strengthen "protection for more American workers that ever before," but a former federal investigator countered that the rules would subtly undermine eligibility of nursery school teachers, nurses and others.
Appearing before a House committee, Chao said the regulations would mean guaranteed overtime protection for 1.3 million salaried workers who earn $455 a week or less. "They are predominantly married with less than a college degree and live in the South," she said.
Other workers earning up to $100,000 also will benefit, she said, adding that the first overhaul in federal overtime rules in more than a half century would sweep away confusion that has led to a rash of lawsuits.
"Often in these protracted lawsuits, workers receive only a few thousand dollars each, while the lawyers may walk away with millions of dollars," she told the Education and Workforce Committee in prepared testimony.
The regulations have become a political flash point, with Democrats vowing to try and block them from taking effect in August.
Republicans in Congress have expressed relief that the regulations revise last year's draft of the rules and clarify that police, firefighters and other first responders (search) would remain eligible for overtime, and that veterans would not be disqualified from premium pay on the basis of their military service or training.
But Democrats argue that the proposal would disadvantage millions of workers earning between $23,660 and $100,000.
Karen D. Smith, a former wage and hour investigator at the Labor Department, told the committee that the new rule "artfully weakens the current regulation in very subtle, but significant ways that will surprise employers and employees."
In prepared remarks, she said teachers, including those who work long hours in nursery school, would be adversely impacted, as would registered nurses, cooks, employees chosen to become team leaders, assistant managers, outside sales employees and workers in the computer and financial service industries.
She said that many of the employees who will lose overtime eligibility "work in businesses that the department has identified as low-wage industries."
The rules also provide for overtime eligibility for salaried workers who earn up to $23,660, higher than the $22,100 originally proposed. Overall, the final rule "is as protective as the current regulation for the 57 million paid hourly and salaried workers who earn between $23,660 and $100,000" a year, the regulations say.
By contrast, an estimated 107,000 employees who earn more are at risk for losing their overtime, according to the regulations.
Despite the claims, Democrats in the House and Senate said they intended to press for election-year votes to stonewall the regulations.
"There has been a lot of happy talk out of the Department of Labor (search), but the fact is that this regulation is riddled with loopholes, potentially making millions of Americans earning as little as $23,660 vulnerable to losing their overtime," said Sen. Tom Harkin, D-Iowa, the leader of the effort to block the rules in the Senate.
Harkin and other critics prevailed last year on a vote of 54-45, with the help of six Republicans who abandoned the administration on the issue.
Three of the Republicans, Sens. Lincoln Chafee of Rhode Island; Lisa Murkowski of Alaska and Olympia Snowe of Maine, said Tuesday they have not yet reviewed the revised regulations.
The GOP-controlled House voted 221-203 last year to block implementation of the rules. A symbolic move, the vote was nonbinding. On a different occasion, Democrats failed on a vote of 213-210 to put the House on record in opposition to the regulations.