Biden Announces New Overtime Rules at a Columbus Ice Cream Company
Correction: The original version of this story incorrectly said Brown estimated the value of the changes at $12 million. It should have read $12 billion.
Vice President Joe Biden was in Columbus Wednesday to make an official announcement about new labor rules that are surprising the country.
The downtown Columbus headquarters for Jeni’s Splendid Ice Creams was packed as Vice President Joe Biden announced new rules that extend the eligibility for workers to get paid overtime.
Biden said he’s a fan of Jeni’s because of its ice cream and treatment of employees.
"Jeni’s understands what the word fair means. A lot of this isn’t complicated. We make it sound complicated but it’s all basically about just being fair.”
Here’s how the new rules break down:
Right now someone making a salary of about $23,000 or more is not required to get paid overtime. But the new rules, which would start in December, would nearly double that threshold. So anyone making about $47,000 or less must be paid overtime if they work more than 40 hours a week.
To Biden, a job is about more than just a paycheck. It’s about dignity, "and you deprive your dignity, in my view, when you know you’re working much much harder and much much longer than you’re getting compensated for.”
Money back in the economy
Democratic U.S. Sen. Sherrod Brown says over the next decade, the change will put $12 billion into the pockets of employees.
“They’re not putting that money into a Swiss bank account," says Brown.
"They’re spending that money in a grocery store in Ashland, or spending that money in a hardware store in Dublin, or spending that money buying some new clothes for their daughter at Centennial High School.”
Ohio labor groups have come out to support the rule change, which will be implemented by the U.S. Department of Labor. Ohio AFL-CIO President Tim Burga said that requiring overtime pay for what would likely be hundreds of thousands of Ohioans would help bridge the gap with the continuing problem of income inequality.
A stranglehold on business
But some groups say the new rules put a stranglehold on business owners.
“This ruling doesn’t take into account what restaurants have to deal with,” says Natalie Walston with the Ohio Restaurant Association, which represents 22,000 restaurant owners in the state.
She says the threshold is way too high, especially for the restaurant business, where hours can fluctuate.
“The great thing about working in a restaurant is sometimes you can set your own schedule. If you need extra hours you can always get them; if you need time off you can have somebody else who can come in and take your place.”
Higher pay; fewer benefits
Roger Geiger is vice president of the National Federation of Independent Business’ Ohio chapter, representing nearly 25,000 small businesses.
Geiger says the new rules will hurt the employees the Obama administration wants to help, because as Geiger puts it, business have to find the money somehow.
“And it’s gonna come from reduced benefits; it’s gonna come from taking someone from a managerial position and putting them back into an hourly position with potentially a loss of benefits that they may have had as a manager. It’s gonna cap the number of hours that they are able to work, somewhere between 35 and 40 hours.”
The new rules also give workers the option to take time off instead of getting the time and a half of overtime pay. The Obama Administration estimates that this will affect more than 4.2 million Americans.