[Congressional Record Volume 169, Number 186 (Thursday, November 9, 2023)]
[Senate]
[Pages S5439-S5440]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                           Labor Regulations

  Mr. THUNE. Mr. President, as I have said before, when it comes to the 
actions of government, it is often legislation that grabs the biggest 
headlines. But it is equally important to focus on what a Presidential 
administration is doing with its regulatory power--something I was 
reminded of again last week when I signed on to a letter headed by 
Senator Cassidy on the Biden administration's proposed new overtime 
rule. Because in the modern regulatory state, Presidents have a 
tremendous amount of power to affect our economy and Federal policy 
through regulation.
  Today, I would like to take a couple of minutes to talk about some 
labor regulations coming out of the Biden administration that are 
likely to prove detrimental to workers, business owners, and our 
economy.
  Let me start, as I mentioned, with the Biden administration's 
proposed new overtime rule. This proposal would impose a 55-percent 
increase in the exemption threshold for providing overtime pay for 
covered employees.
  Currently, employers are required to pay covered employees making 
less than $35,568 per year overtime if they work more than 40 hours per 
week. Under the Biden administration's proposed new rule, employers 
would be required to pay overtime to covered employees making less than 
$55,068. As I said, a massive 55-percent increase in the exemption 
threshold.
  So what would be the effects of this proposed rule? It would likely 
result in some combination of higher prices, fewer job opportunities, 
and lower base pay for employees because employers--and I am thinking 
particularly of small businesses that are always going to be hit 
hardest by regulations like this--are going to be forced to look for 
ways to offset what could be a substantial increase in costs.
  Indeed, many small businesses will have to find some way of 
offsetting this cost increase if they want to stay profitable. So 
businesses large and small are likely to compensate either by 
increasing prices on their goods or services, reducing the number of 
positions that they have available, or lowering the base pay to create 
room to pay overtime wages. Needless to say, none of these are 
attractive options for workers, consumers, or businesses.
  Consumers are currently stretched to their limit with price hikes in 
the Biden economy, and lower base pay or fewer available positions are 
not attractive options for American workers.
  By the way, you don't have to take my word for it on that lower base 
pay. The head of President Biden's own Council of Economic Advisers has 
previously noted:

       The costs of increase [overtime] coverage would ultimately 
     be borne by workers as employers set base wages taking 
     expected overtime pay into account.

  It would be nice if this were the only bad labor rule coming out of 
the Biden administration, but it is not. Among

[[Page S5440]]

other bad regulations, there is also the independent contractor rule, 
which the Biden Labor Department is likely to finalize soon. It is 
referred to as the ``independent contractor rule,'' but in many ways, 
that is a misnomer because this rule is likely to substantially reduce 
the number of independent contractors.
  How? By replacing the previous administration's independent 
contractor rule, which would have provided clear guidelines for 
determining whether a worker classifies as an independent contractor, 
with a vague, sweeping new rule that could end up with many workers 
being reclassified as employees.
  Independent contractors, who range from computer programmers to 
freelance editors to Uber and Lyft drivers, generally value independent 
contracting thanks to things like the flexibility and opportunity that 
this path provides.
  Indeed, a 2017 survey from the Bureau of Labor Statistics found that 
fewer than 1 in 10 independent contractors would prefer traditional 
employee status. But thanks to the Biden administration, many of them 
may be forced into employee status.
  The rule will threaten workers in the gig economy, which is made up 
of platforms like Uber, Lyft, DoorDash, and TaskRabbit, that allow 
workers to pursue full-time work with a platform or simply augment 
their income from a regular 9-to-5 position.
  The bad ideas don't end with the independent contractor rule. There 
is also the joint employer rule the National Labor Relations Board 
recently finalized--yet another move from the Biden administration to 
use the power of the Federal Government to advantage unions.
  The joint employer rule substantially changes the standard of what 
constitutes a joint employer, which comes into play in a major way with 
franchising. To put this in practical terms, this rule means that 
companies could end up being considered joint employers of employees at 
franchised locations of their business, which could force both the 
company and the local franchise owners to negotiate with unions, or 
make both the company and local franchise owners liable for unfair 
labor practices that potentially only one party is responsible for.

  The result is likely to be that companies cut back on franchising or 
increase oversight or control of their franchisees, which would disrupt 
one of the most accessible paths to business ownership for Americans 
looking to run their own businesses.
  In comments after the new joint employer rule was proposed, the 
International Franchise Association noted:

       The proposed rule will needlessly upend the franchise 
     business model and close the door to opportunity for hundreds 
     of thousands of Americans, especially women, people of color, 
     veterans, and first-time business owners.

  But, apparently, that doesn't matter to the Biden administration, as 
long as union bosses are benefiting.
  On the economic front, President Biden is perhaps most famous for 
helping to kick off the worst inflation crisis in 40 years with the so-
called American Rescue Plan. But as these rules and regulations 
demonstrate, the President is continuing to build on that negative 
economic legacy with regulations that will diminish economic 
opportunities for workers and entrepreneurs and likely continue to 
drive up prices for consumers.
  In other words, business as usual in the Biden administration: The 
President imposes his Big Government policies, and the American people 
end up paying the price.
  I yield the floor.
  I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. TUBERVILLE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.