Wednesday's move followed a massive lobbying effort by organized labor that targeted moderate House Republicans.
The measure would let hourly workers who log more than 40 hours in a week choose between overtime pay or compensatory time off at a later date. Private companies are barred under the 1938 Fair Labor Standards Act from offering comp time as an option to millions of workers covered by the law.
Labor's success, however, could be short-lived. Republicans vowed to reschedule the vote after they "unravel the campaign of lies launched" by unions.
"Because of the campaign of lies waged by the leaders of organizations like the AFL-CIO, private sector working mothers and fathers continue to be denied the right to choose paid time off with their families instead of overtime pay - a right that has been enjoyed and cherished by federal workers and other government employees for years," said Rep. John Boehner, R-Ohio, chairman of the Education and Workforce Committee. "We fully expect that we'll have another opportunity to pass this measure during the 108th Congress."
Supporters say the bill provides flexibility to workers who increasingly are juggling demands of career and family. It would let workers accrue compensatory time off to attend parent-teacher conferences, school events or whatever they choose, with their employers' approval.
Labor leaders say the current overtime law acts as a protection to the 40-hour work week because companies wanting more work from their employees now must provide premium pay - and often think twice about it. They also argue that if the bill becomes law, employers will assign overtime only to workers who agree to choose comp time, even though the measure prohibits the practice.
"We're going to keep educating members of Congress and the general public about what's at stake," said Bill Samuel, the AFL-CIO's legislative director. "With more time to explain what's at stake, opposition will grow."
Organized labor has lost a lot of battles in the GOP-controlled Congress - especially the House, where leaders rule with an iron fist and defections are rare.
But this time, with the Republican leadership distracted with tax cuts, labor officials secured unwavering opposition to the bill from moderate Republicans who represent districts heavy with union membership, while holding most all the Democrats.
The measure passed in 1996 and 1997 with at least a dozen Republicans and Democrats crossing the aisle.
Labor officials hope to move their momentum from the fight to the Labor Department, where officials are drastically changing the criteria that determines which workers are eligible for overtime pay. The final regulation, which does not need approval by Congress, could be issued by fall.
By Leigh Strope