Bush Overtime Rules Slammed

Disputing Bush administration estimates, a labor-backed think tank said Wednesday that new federal rules will remove overtime protections for at least 6 million U.S. workers.

The study by the Economic Policy Institute was released a day after three former Labor Department officials said in a report requested by the AFL-CIO that "large numbers" of employees entitled to overtime would no longer get it when the new rules take effect Aug. 23.

The Bush administration took issue with the findings.

"These latest studies are a rehash of misinformation that the AFL-CIO put out about the department's final overtime security rule in April, assertions that were completely discredited in congressional hearings," said Labor Department spokesman Ed Frank.

The department estimates that up to 107,000 high-income workers making $100,000 or more annually could lose overtime under the new rules, while 1.3 million low-wage workers who are denied overtime will become eligible.

Sen. John Kerry has said that if elected president he would move immediately to restore overtime protections to those who would lose it.

The presumptive Democratic nominee said the analysis by the former Labor officials, who worked in Republican and Democratic administrations, demonstrated that the Bush administration rules "represent a shameful assault on the paychecks of hardworking Americans."

The Economic Policy Institute report estimated that among those who would lose overtime protection were nearly 2 million administrative workers who can be classified as "team leaders" and 920,000 workers who can be reclassified as a "learned professional" even though they do not have college degrees.

The EPI study also said 1.4 million workers who, because of the rules changes, can be reclassified as executives will lose overtime pay as will an estimated 130,000 chefs and cooks, 160,000 financial service workers and 117,000 teachers and computer programmers.

The report by the three former Labor Department officials said the rules change impact was likely to be significant because "more classes of workers and a greater proportion of the work force overall will be exempt than we believe the Congress could have originally intended."

The Labor Department says the changes are necessary to update the law to reflect today's workforce.

The federal overtime law requires that employees be paid overtime unless they meet three tests: they must be paid more than a certain amount, be paid a salary rather than an hourly wage and perform certain duties.

The Bush administration is raising the salary ceiling from $155 a week to $455 a week. That will increase the number of workers covered.

What is in dispute is how many more workers will be exempt from overtime pay because of the way the administration is redefining which categories of workers are covered. For example, EPI says the administration's proposal would deny pay to an employee who "leads a team of other employees assigned to complete major projects for the employer."

In June, the Republican-controlled Senate voted to demand that any new rules guarantee continued eligibility for overtime pay to any worker who currently qualifies.

The vote was an unusual setback for the administration in the Republican-controlled Senate, and a victory for organized labor.

"There is simply no reason for the Bush administration to slash a single worker's overtime pay, especially in this economy, when middle income families are already so hard-pressed," AFL-CIO President John Sweeney said in a statement.

The regulations take effect in August. Barring a reversal in the administration's position, critics trying to block the rules have many formidable obstacles to overcome.

Labor Secretary Elaine Chao revised the regulations substantially over a draft issued a year ago after Republican lawmakers complained that police, firefighters and others could lose overtime eligibility.

Democrats and organized labor said that despite the revisions, millions of workers in dozens of occupations, including police sergeants, could lose overtime coverage.