The media have it wrong; Bush is cutting overtime pay.
The Bush Administration has said that only workers earning less than $23,660 a year would be guaranteed the right to overtime pay. Everybody earning more than that amount could be caught up in several other changes to eligibility rules that take away overtime pay. For nine months, the Administration has been fighting tooth and nail to kill legislation approved by both houses of Congress that would do nothing more than prohibit overtime cuts. The Senate and House already voted once last year to prohibit overtime cuts, but the White House strong-armed Congress to prevent that overtime protection from becoming law.
The Bush Administration has been loudly exaggerating the benefits of a helpful but woefully inadequate change that would expand overtime coverage for some workers. This group is extremely small because most workers who might be helped don't need the help. They are already guaranteed overtime pay through other criteria, based on their job responsibilities.
The Bush overtime cuts will hurt the economy. By taking away workers' overtime rights, President Bush is discouraging job creation. He is encouraging businesses to overwork their existing staff (for no extra pay) rather than hire new workers. The overtime statute was originally intended to encourage job creation.
The new Bush overtime regulation is a pay cut for American workers. When workers are stripped of their overtime rights, their employers can now force them to work overtime for no extra pay. Overtime pay makes up one-fourth of the weekly earnings of workers who earn overtime, an average of $161 per week.
Over the past year, Administration officials have repeatedly misrepresented their proposal and its effects on workers. The Department of Labor (DOL) routinely claimed that only 644,000 people would lose overtime protection, when its own economic analysis concluded that an additional 1.5 to 2.7 million people would be affected.
We also know that DOL inflated the number of low-income workers who would benefit, and in fact DOL admits it has no way of knowing how many would benefit, if any.