Unprecedented Overtime Expansion Likely To Send Business Leaders Into Payroll Damage Control

The Daily Caller discusses the impact of the Department of Labor's overtime rule with Trey Kovacs. 

"These small businesses, who may not be aware of this rule, are going to have a very difficult time figuring out if their salaried employees are no longer exempt or really working over 40 hours,” Competitive Enterprise Institute Expert Trey Kovacs told TheDCNF. “They’re going to have to make changes. Either reduce their pay, demote them to hourly workers.”

The DOL also might drop a provision in the drafted proposal known as the duties test. Employees must perform tasks that are managerial in nature to be exempt from overtime. The proposed rule would expand the duties test and require employers to track exactly how long a manager performs each task. Managers often need to balance several tasks at once and must be ready to shift priorities quickly making it very difficult to track exactly how much time they spend on a particular thing.

“They want to get this done and have a clean rule because the secretary has vast authority to define the salary exemption,” Kovacs said. “They’re definitely within their power to do that aspect of the rule but its unclear whether changes in the duties test is within their powers.”

Read the full article at Daily Caller.