Small business group opposes proposed overtime rules

Tony Gagliardi NFIB

A small business advocacy group opposes new overtime rules proposed by the Colorado Department of Labor and Employment.

Tony Gagliardi, state director of the National Federation of Independent Business
in Colorado, compared the plan to “handing the cockpit of a smoothly running aircraft over
to circus animals.”

“Nothing good can come of it,” he said.

The draft rules require overtime pay for almost anyone paid less than $42,500 per year and who hasn’t been eligible for overtime in the past for working more than 40 hours a week.

The rules also raise the minimum in Colorado by $3,000 beginning in 2021 and an additional $3,000 a year until the level reaches $57,500 in 2026. After that, the minimum would be adjusted by the same Denver-Boulder-Greeley Consumer Price Index used to adjust the minimum wage in the state.

A public hearing on the draft rules is set for Dec. 16. Public comments will be accepted until Dec. 31. If adopted in January, the rules would go into effect on March 1.

“You can’t help but wonder if the department has been stranded on an island these past few years, shut off from any news,” Gagliardi said.

The NFIB joined in a federal court case that stopped the Obama administration from raising the federal overtime threshold to $47,476, he said. The Trump administration raised the federal threshold to $35,568, which takes effect on Jan.1.

Moreover, the results of monthly surveys of small business owners conducted by the NFIB reflect record highs in employee compensation in reaction to record-high readings for difficulties in finding qualified employees, he said.

“It bears reminding everyone that we are talking about executive, supervisory and professional workers, not salaried employees. This special class of worker does a wide variety of tasks often during flexibly scheduled hours that do not easily fit in a government straight jacket,” he added.

In addition, increases in base wages place upward pressure on all wage levels, Gagliardi said. “This increase in labor costs requires the business owner to make adjustments. Those adjustments will be fewer hours assigned, slower job creation or a reduction in the workforce.”