Vail Daily column: Proposed labor rule will hurt economy
It may be news to many in Colorado that the Department of Labor proposed a new rule last year to increase the salary threshold for exempt employees. Overall, this is positive news, but the dramatic changes will have far-reaching implications, especially in rural Colorado.
As the Fair Labor Standards Act is written, employees must qualify under three criteria to be exempt from overtime pay. These criteria are simple: Have a salary, make more than $23,660 per year and conduct specific job duties (professional, administrative and similar). This rule is generally revised every five or so years, and it makes sense the Department of Labor is updating it now. So what’s the big deal?
The Department of Labor’s original proposal from summer 2015 suggested raising the salary threshold 113 percent to $50,440 per year. That’s huge. And the Department of Labor is pushing this rule through quickly, having already received thousands of comments and submitted it to the Office of Budget and Management. In recent weeks, the Department of Labor is reported to be lowering the threshold to $47,500 in its final rule, which is still double the current salary threshold. Plus, the final rule could be issued as early as this month, and be implemented as quickly as 60 days from implementation.
This large of an increase is unprecedented, and as a ranch wife, a volunteer fire chief and Routt County treasurer, I am particularly concerned about the rule’s impact on local budgets. Many of our local staff and those in surrounding Colorado counties fall within the $23,660-$47,500 range and would be moved to hourly positions if the Department of Labor rule is implemented. These are not jobs that should be hourly. They impact, most greatly, our rural counties and those with tourism-based economies.
Forcing employees to move from salary to hourly will increase costs to the county. Workers will need to be monitored to clock in hours, and simply stated, Routt County cannot afford to pay currently salaried employees overtime. We have seen shrinking revenues due to mine closings and other economic factors, and do not currently have a way to supplement tight budgets.
Much of our economy is seasonal tourism and there are times of year when employees work fewer hours and other times when they’re working more than 40 hours; and salaries allow for that flexibility. Forcing employers to pay overtime during the busy season will severely harm budgets and the level of services provided. Forcing workers to clock out at 40 hours doesn’t serve customers and clients either.
Yes, the rule should be updated. But there are more incremental ways to do this, rather than doubling the salary threshold in one swoop. Rural areas of Colorado, such as Summit, Vail, Moffat, Grand and Routt counties cannot afford this significant spike in the salary threshold, and the 60 days’ time allotted to adjust and absorb a major budget hit is not enough.
It is our duty as concerned Coloradans to speak out against such bad policies. Call our senators and your member of Congress today and ask them to support legislation that will stop this rule and require the Department of Labor to re-evaluate the threshold to accommodate small, rural and tourist season economies like ours.
Brita Horn is the Routt County treasurer and public trustee and also the fire chief for Rock Creek Volunteer Fire Department in McCoy. She has been in Colorado since 1989 and lives on the family ranch with her rancher husband, Gary.
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