Proposed Legislation Would Slow Down Implementation for Small Business Owners
Washington, D.C. – July 21, 2016 – This week Representative Kurt Schrader (D-OR), along with several Democratic colleagues, introduced the Overtime and Reform Enhancement Act (H.R. 5813), legislation that calls for slowing down the implementation of the Department of Labor’s (DOL) final overtime eligibility rule introduced in May. This would give small business owners, health care providers, nonprofit and social service employers, and universities three years to make the transition.
The DOL’s new federal ruling raises the threshold for employees to be exempt from overtime pay from $23,660 to $47,476 and goes into effect December 1, 2016. However, Representative Schrader’s legislation would gradually raise the threshold to $35,984 the first year, and subsequently increase it until the DOL’s cap of $47,476 is met in year three, or by December 1, 2019.
“The gradual approach taken by Representative Schrader would allow small businesses adequate time to prepare for the cost and effort needed to comply with this sudden, dramatic increase,” says the American Pizza Community (APC) Chair Tim McIntyre.
According to the National Center for Policy Analysis, the Department of Labor’s rule will cost the restaurant and retail industries $2 billion annually. Not only will a larger portion of the workforce be required overtime pay, but the move will also negatively impact flexibility for employees and increase administrative and operating costs.
While H.R. 5813 would mitigate the effects of doubling the threshold, the American Pizza Community continues to support the Protecting Workplace Advancement and Opportunity Act (S. 2707 and H.R. 4773), which would require DOL to fully examine the rule’s impact before the final rule becomes effective. The APC sent a letter in June to Senators urging their support for the legislation, and included this as a major topic during its Washington, D.C. fly-in event last April.
The APC is a coalition of pizza companies, operators, franchisees, and suppliers who collectively employ more than 400,000 Americans. There are nearly 73,000 pizza stores around the country.
The American Pizza Community
The American Pizza Community is a coalition of the nation’s large and small pizza companies, operators, franchisees, vendors, suppliers and other entities that make up the American pizza industry. The coalition was formed in 2010 to advocate for policies affecting pizza companies and operators including menu and labeling information, fair wages, work opportunity tax credit, background checks, tax policies and small business access to capital.
Current members include Blackjack Pizza, Breadeaux Pizza, Domino’s Pizza, Figaro’s Italian Pizza, Godfather’s Pizza, Hungry Howie’s, Hunt Brothers Pizza, the International Pizza Hut Franchise Holders Association, Little Caesars, Nick-N-Willy’s, Papa John’s Pizza, Papa Murphy’s Pizza, Papa’s Pizza To-Go, Papa Romano’s Pizza, Pieology, Pizza Factory, Pizza Schmizza, and Sam & Louie’s Pizza. Supplier partners include Coca-Cola, Leprino Foods Company, Middleby Marshall, Paradise Tomato Kitchens, PepsiCo and Tyson Foods. Affiliate partners include the Consortium for Common Food Names, the National Pork Producers Council and the Tomato Products Wellness Council.
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