[Congressional Record Volume 162, Number 89 (Tuesday, June 7, 2016)]
[Senate]
[Pages S3544-S3545]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ALEXANDER (for himself, Mr. Johnson, Mr. McConnell, Mr. 
        Barrasso, Mr. Boozman, Mr. Cassidy, Mr. Coats, Mr. Cochran, Ms. 
        Collins, Mr. Corker, Mr. Cornyn, Mr. Cotton, Mr. Crapo, Mr. 
        Cruz, Mr. Daines, Mr. Enzi, Mrs. Ernst, Mrs. Fischer, Mr. 
        Flake, Mr. Gardner, Mr. Graham, Mr. Hatch, Mr. Heller, Mr. 
        Hoeven, Mr. Inhofe, Mr. Isakson, Mr. Lankford, Mr. Lee, Mr. 
        McCain, Mr. Moran, Ms. Murkowski, Mr. Paul, Mr. Perdue, Mr. 
        Risch, Mr. Roberts, Mr. Rounds, Mr. Rubio, Mr. Scott, Mr. 
        Sessions, Mr. Shelby, Mr. Thune, Mr. Tillis, Mr. Vitter, Mr. 
        Wicker, and Mr. Sullivan):
  S.J. Res. 34. A joint resolution providing for congressional 
disapproval under chapter 8 of title 5, United States Code, of the rule 
submitted by the Department of Labor relating to defining and 
delimiting the exemptions for executive, administrative, professional, 
outside sales, and computer employees; to the Committee on Health, 
Education, Labor, and Pensions.
  Mr. ALEXANDER. Mr. President, I am here today to introduce a 
Congressional Review Act resolution of disapproval on the 
administration's so-called overtime rule. I am joined by Senator 
Johnson of Wisconsin on this effort and also 43 other Senators who are 
cosponsors.
  While President Obama is running around talking about keeping college 
costs down, his administration has put out this so-called overtime rule 
that could raise tuition by hundreds of dollars for millions of 
American college students or cause layoffs at our colleges and 
universities. In Tennessee, for example, colleges report to me that 
they may have to raise tuition by anywhere from $200 a student to $850 
a student in one case because of this rule.
  The administration's new rule is a radical change to our Nation's 
overtime rules. What they have done is doubled the salary threshold for 
overtime. Here is what that means. Hourly workers are usually paid for 
overtime work, but salaried workers generally don't earn overtime 
unless they are making below a threshold set by the Labor Department, 
as required by the Fair Labor Standards Act. Today that threshold is 
$23,660. This administration is raising it all at one time to $47,476. 
The administration calls this the overtime rule. I think we should call 
this the ``time card'' rule or the ``higher tuition'' rule. This means 
that a midlevel manager in Knoxville or Nashville who is making $40,000 
a year is going to have to go back to punching a time card.
  The rule affects 4.23 million workers nationwide and nearly 100,000 
in Tennessee. It is going to create huge costs for employers, including 
small businesses, nonprofits, such as the Boy Scouts, and colleges and 
universities. They have to decide whether to cut services, cut 
benefits, lay off or demote employees, or create more part-time jobs or 
do a little of all of that.
  The University of Tennessee says that if they increase everyone's 
salaries to meet the new threshold, they will have to increase tuition 
by over $200 per student on average, with some seeing as much as a $456 
increase.
  If they put all the salaried employees back on time cards, they will 
face big morale issues.
  Listen to this letter I received from a University of Tennessee 
employee:

       Currently, I am an exempt employee but I stand to fall 
     under the non-exempt status under the new standards. While 
     this may not seem like a major issue to many, I stand to lose 
     a substantial amount of benefits if my status changes. The 
     nature of my position does not ever cause me to work 
     overtime, as I work in an office from 8:30-4:30 daily and I 
     am salaried. If I am reclassified, it appears I will lose 96 
     hours of annual leave per year, as well as be subject to an 
     almost 100 hour lower cap on accrued annual leave.

  Another private college in Tennessee tells me it will cost them the 
equivalent of $850 a student if they don't lay off any employees.
  As employers, they also face the cascade of regulations that is 
coming from the Labor Department.
  This rule should be called the ``time card'' rule because they are 
going to pull millions of Americans who have climbed their way to 
salaried positions backwards--back to filling out a timecard and 
punching a clock, back to having fewer benefits, backwards in their 
careers, back to being left out of the room, back to being left off 
emails and even out of the discussion.
  Want to show your stuff at work? Want to get up early, leave late, 
climb the ladder, earn the American dream the way that so many 
Americans have before you? Tough luck. Employers are going to say: 
Don't come early. Don't stay late. Don't take time off to go to your 
kids' football game. Work your 8 hours and go home. I don't have enough 
money to pay you overtime.
  This rule says the Obama administration knows best. They know how to 
manage your career, your work schedule, your free time, and your 
income. They know better than you do.
  Today, somebody who makes a salary of less than $23,660 must be paid 
overtime. Almost everyone agrees that threshold is low and should begin 
to go up. Almost everyone said to the administration: It is time to 
raise the number, but don't go too high, too fast or you will create 
all kinds of destruction.
  They didn't listen, so now we are going to have these huge costs.
  Let's talk about employers. Let's remember that we are talking about 
nonprofits like Operation Smile, which is a charity that funds cleft 
palate operations for children. They say this rule will mean 3,000 
fewer surgeries a year. Then there is the Great Smoky Mountain Council 
of the Boy Scouts, my home council, which estimates $100,000 in added 
annual costs because during certain seasons, employees staff weekend 
campouts and recruitment events, which mean longer hours.
  Many Americans are discouraged by this economic recovery. Millions 
are still waiting for the recovery. But you don't grow the economy by 
regulations such as this.
  The National Retail Federation says the rule will ``curtail career 
advancement opportunities, diminish workplace flexibility, damage 
employee morale, and lead to a more hierarchical workplace.''

[[Page S3545]]

  The U.S. Chamber Commerce says: ``The dramatic escalation of the 
salary threshold, below which employees must be paid overtime for 
working more than 40 hours a week, will mean millions of employees who 
are salaried professionals will have to be reclassified to hourly wage 
workers.''
  There are 16 million Americans--including 320,000 Tennesseans--who 
are working part time while looking for full-time work or who are out 
of work entirely. They need a vibrant economy; they don't need 
Washington bureaucrats telling them how to manage their work schedule, 
their free time, and their income.
  I know this is a good-sounding rule, but it wrestles more and more 
control from the hands of Americans and small business owners and puts 
more power in Washington agencies.
  Many of these rules, like the overtime rule or the ``higher tuition'' 
rule or the ``time card'' rule--call it whatever you will--won't stand 
the test of time. They will end up in courts and they will lose, or 
another President will come along and fix what is broken. But in the 
meantime, how many millions of dollars and hours of time will be wasted 
as small business owners make excruciating decisions about how to 
implement these rules?
  My hope is that the Senate will vote to give this ``time card'' 
``higher tuition'' rule an early death before business owners and 
nonprofits and colleges and universities begin the task of implementing 
it by December.
  The PRESIDING OFFICER. The Senator from Wisconsin.
  Mr. JOHNSON. Mr. President, I rise first to say thank you to the 
Senator from Tennessee for leading this vote of disapproval on what is 
really a terrible rule. It is a solution looking for a problem.
  I spent 31 years running a manufacturing plant. It has been my 
experience that I have never had somebody in my operation ask to go 
from salary to hourly. I remember in 2004 when they tightened the rules 
and a number of people who worked for me were forced into hourly. None 
of them wanted to go. By the way, none of them received higher wages or 
a higher salary; they just lost flexibility--and that is exactly what 
is going to happen.
  Being an accountant, I would like to kind of go through the numbers. 
These are the Department of Labor's own calculations. They claim there 
would be $1.2 billion more wages paid to workers. That is what they 
claim the benefit is going to be, but they also admit that there will 
be $678 million in compliance costs to businesses just trying to figure 
out the rule, trying to implement it.
  What they are missing is, if wages--and I think that is a big ``if'' 
because I think what will end up happening is--you know, employers are 
competing in a global economy, and you can't just increase costs. So my 
guess, basically, is what is going to happen--and happened to my 
business in 2004--is they will just adjust. The workers won't get any 
more money. But let's just say $1.2 billion in wages is paid to 
workers. Well, that will be a cost to businesses. So as far as the 
overall benefit to the economy, wages might increase $1.2 billion, but 
business costs will increase $1.2 billion, and that nets to zero 
benefit to the economy. But there will still be a $678 million 
compliance cost to businesses, and, of course, that will be added to 
the already onerous regulatory burden on our economy.
  There are three different studies--the Small Business Administration, 
the Competitive Enterprise Institute, and the National Association of 
Manufacturers--putting the cost of complying with Federal regulation 
somewhere between $1.75 trillion to over $2 trillion per year. If you 
take the medium estimate of that and divide it by 127 million 
households, that is a total cost of compliance with Federal regulations 
of $14,800 per year, per household. The only larger expense to a 
household is housing. That is the cost of complying.
  Let me finish with another figure--$12,000 per year, per employee. 
That is the cost of just four Obama regulations to one Wisconsin paper 
manufacturer. I can't tell you which one because the CEO fears 
retaliation. Now, think of that for a minute. But just four Obama 
regulations are costing one paper manufacturer the equivalent of 
$12,000 per year, per employee.
  So if you are concerned about income inequality, if you are wondering 
why wages have stagnated, look no further than this massive regulatory 
burden, and of course the overtime rule is just one of those burdens. I 
would just ask everybody, would you rather have that $12,000 feeding 
the government in compliance costs or would you rather have that 
$12,000 in your paycheck feeding your family?
  Making a living is hard. Big Government just makes it a whole lot 
harder, and this overtime rule is just going to make it that much more 
incrementally harder.
  Mr. ISAKSON. Mr. President, I rise for a few minutes to compliment 
Chairman Alexander and Senator Johnson for their resolution of 
disapproval on the overtime rule.
  When I came into the Chamber, Lamar Alexander was making his speech, 
followed by Senator Johnson. I listened closely, because I got a phone 
call last week from Bryant Wright, the pastor at the Johnson Ferry 
Baptist Church in Marietta, GA. They are one of the largest Baptist 
churches in my State. They provide daycare. They provide early 
childhood development. They provide sports activities. They provide 
vacation Bible school--a 24/7 program for underprivileged kids.
  The unintended consequence of what I am sure is a well-intended 
regulation is that a 24-hour-a-day camp counselor at Johnson Ferry 
Baptist Church for their vacation Bible school will be paid regular pay 
for 8 hours and then have to be paid time and a half for the other 16 
hours of the day they are with the child under the application of the 
rule. You are going to price the Johnson Ferry Baptist Church out of 
the business of providing for underprivileged children. And what is 
going to happen? Those people are going to come to the government for 
the government to provide that service.
  So what this will do is take a church out of the business of helping 
human beings and put the government in the position of having more 
demand for taxpayers to fund services that would have been provided 
anyway.
  I commend Chairman Alexander. I commend Senator Johnson and others. I 
urge all my colleagues to join them in the resolution of disapproval in 
the overtime rule. It is wrong for America. Its consequences are 
unintended, but they are devastating. I urge everybody to vote in favor 
of it, and I appreciate Senator Alexander for his leadership in 
introducing that joint resolution.
  I yield the floor.

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