All eyes have been on the Trump administration since the announcement was made that overtime rules implemented under the previous administration would be put on hold. We now have a better idea of the direction lawmakers might take thanks to a new bill passed by the House of Representatives in early May. The bill allows employers a new way to compensate employees for overtime.
Under current law, there is but one option: eligible employees must be paid time-and-a-half for every overtime hour worked. This does not necessarily pertain to all workers, as evidenced by the armies of federal workers who can trade time-and-a-half pay for comp time. The GOP bill essentially offers that same flexibility to private sector workers.
Nuts and Bolts of the Bill
As written, the bill would allow employers to offer workers the option of receiving comp time rather than time-and-a-half pay for working over and above 40 hours in any given week. Employers would be banned from "directly or indirectly intimidating, threatening, or coercing or attempting to intimidate, threaten, or coerce an employee" to choose comp time instead of overtime pay.
The bill also makes provision for employees who change their minds. For example, a worker could elect to take comp time with the understanding that it might be needed in the future to take care of family needs. That same employee could later change his or her mind and cash in the comp time for an equal amount of overtime pay.
Employers would face stiff penalties for attempting to coerce employees in one direction or another, including double compensation if they are caught trying to force or manipulate workers into choosing comp time. Double compensation is seen as a very strong incentive to discourage employers from running afoul of the rules.
Reaction to the Bill
As you might expect, the bill passed the house largely along party lines. GOP supporters claim that the legislation is a way to put more power and flexibility in the hands of workers by giving them access to a provision federal workers have enjoyed for more than 30 years. They say the legislation would benefit employers as well, allowing them more flexibility in how they compensate workers for overtime.
The GOP is quick to point out that the bill in no way establishes a mandate. Employers would be able to determine individually whether they want to offer the option or not. Likewise, employees who are offered it could still choose to receive overtime pay instead of comp time. The bill in no way forces either party into a corner.
Opponents of the bill claim that it opens the door for abuse among employers who do not want to pay time-and-a-half. They claim that it takes even more power away from employees given the fact that they don't make their own schedules. One ranking Democrat went so far as to say workers can already get extra time off simply by working overtime and banking the extra pay to cover the desired time off in the future.
There is no indication of how the bill will do as it makes its way through the Senate. Should it pass without any changes, which is highly unlikely given the current environment, president Trump is very likely to sign it swiftly. Other options include passing a similar bill that would need to go to reconciliation or defeating the idea outright. Whichever way it works out, it is clear that president Trump and the GOP are not content to allow rules set by the previous administration to take effect as currently written.