    [House Report 119-413]
    [From the U.S. Government Publishing Office]

    119th Congress }                                       { Report
                            HOUSE OF REPRESENTATIVES
      1st Session  }                                       { 119-413
    ======================================================================

                   EMPOWERING EMPLOYER CHILD AND ELDER CARE
                                  SOLUTIONS ACT

                                    _______

     December 18, 2025.--Committed to the Committee of the Whole House on
                the State of the Union and ordered to be printed

                                    _______

     Mr. Walberg, from the Committee on Education and Workforce, submitted
                                 the following

                                  R E P O R T

                                 together with

                                 MINORITY VIEWS

                            [To accompany H.R. 2270]

          [Including cost estimate of the Congressional Budget Office]

        The Committee on Education and Workforce, to whom was
    referred the bill (H.R. 2270) to amend the Fair Labor Standards
    Act of 1938 to exclude child and dependent care services and
    payments from the rate used to compute overtime compensation,
    having considered the same, reports favorably thereon with an
    amendment and recommends that the bill as amended do pass.
        The amendment is as follows:
      Strike all after the enacting clause and insert the
    following:

    SECTION 1. SHORT TITLE.

      This Act may be cited as the ``Empowering Employer Child and Elder
    Care Solutions Act''.

    SEC. 2. EXCLUSION OF CHILD AND DEPENDENT CARE IN COMPUTING OVERTIME
                        COMPENSATION.

      (a) In General.--Section 7(e) of the Fair Labor Standards Act of 1938
    (29 U.S.C. 207(e)) is amended--
              (1) in paragraph (2), by inserting ``payments or
            reimbursements for child or dependent care services;'' after
            ``by the employer;'';
              (2) in paragraph (7), by striking ``or'' at the end;
              (3) in paragraph (8)(D)(ii), by striking the period at the
            end and inserting ``; or''; and
              (4) by adding at the end the following:
              ``(9) the value of any child or dependent care services
            provided by an employer.''.
      (b) Effective Date.--The amendment made by subsection (a) shall apply
    with respect to overtime compensation required to be paid for workweeks
    beginning on or after the date of enactment of this Act.

                                    Purpose

        To amend the Fair Labor Standards Act of 1938 to exclude
    child and dependent care services and payments from the rate
    used to compute overtime compensation.

                                Committee Action

                                 117TH CONGRESS

    Second Session--Hearing

        On May 11, 2022, the Subcommittee on Workforce Protections
    held a hearing titled ``Standing Up for Workers: Preventing
    Wage Theft and Recovering Stolen Wages.'' Witnesses were Tammy
    McCutchen, Senior Affiliate, Resolution Economics, New Market,
    TN; Karen Cacace, Labor Bureau Chief, New York State Office of
    the Attorney General, New York, NY; Daniel Swenson-Klatt,
    Owner/Operator, Butter Bakery Cafe, Minneapolis, MN; and
    Francisco Esparza, Representative, United Brotherhood of
    Carpenters, Upper Marlboro, MD. Ms. McCutchen testified about
    excluding child care benefits from the regular rate of pay,
    among other topics.

    Legislative Action

        On July 14, 2022, Representative Elise Stefanik (R-NY)
    introduced H.R. 8388, the Empowering Employer Child and Elder
    Care Solutions Act, which was referred solely to the Committee
    on Education and Labor, but there was no action taken on the
    legislation.

                                 118TH CONGRESS

    Legislative Action

        On May 11, 2023, Representative Stefanik introduced H.R.
    3271, the Empowering Employer Child and Elder Care Solutions
    Act, which was referred to the Committee on Education and the
    Workforce, but there was no action taken on the legislation.

                                 119TH CONGRESS

    First Session--Hearing

        On March 25, 2025, the Subcommittee on Workforce
    Protections held a hearing titled ``The Future of Wage Laws:
    Assessing the FLSA's Effectiveness, Challenges, and
    Opportunities.'' Witnesses were Tammy McCutchen, Senior
    Affiliate, Resolution Economics, New Market TN; Paige Boughan,
    Senior Vice President and Director of Human Resources, Farmers
    and Merchants Bank, on behalf of SHRM, Westminster, MD; Andrew
    Stettner, Director of Economy and Jobs, The Century Foundation,
    Washington, DC; and Jonathan Wolfson, Chief Legal Officer and
    Policy Director, Cicero Institute, Austin, TX. Witnesses
    discussed H.R. 2270, the Empowering Employer Child and Elder
    Care Solutions Act, among other topics.

    Legislative Action

        On March 21, 2025, Representative Mark Messmer (R-IN)
    introduced H.R. 2270, the Empowering Employer Child and Elder
    Care Solutions Act, with Representatives Ashley Hinson (R-IA),
    John Moolenaar (R-MI), and Josh Harder (D-CA) as original
    cosponsors. The bill was solely referred to the Committee on
    Education and Workforce.

    Committee Passage of H.R. 2270

        On April 9, 2025, the Committee considered H.R. 2270 in
    legislative session and reported it favorably, as amended, to
    the House of Representatives by a recorded vote of 18-13.
    Representative Messmer offered an amendment in the nature of a
    substitute making a technical change to the bill, which was
    adopted by voice vote.

                                Committee Views

                                  INTRODUCTION

        The Fair Labor Standards Act of 1938 (FLSA) is the primary
    federal statute establishing standards for minimum wage,
    overtime pay, child labor, recordkeeping, and other wage-and-
    hour standards covering more than 140 million individuals,\1\
    including most private and public sector employees. Under the
    FLSA, employers must pay covered employees no less than the
    federal minimum wage of $7.25 for all hours worked and overtime
    pay of time-and-one-half an employee's regular rate of pay for
    hours worked in excess of 40 in a given workweek. These
    requirements are triggered whenever an employee is ``suffer[ed]
    or permit[ted] to work'' directly or indirectly for the benefit
    of an employer.\2\
    ---------------------------------------------------------------------------
        \1\U.S. Dep't of Lab., Wage & Hour Div., Small Entity Compliance
    Guide to the Fair Labor Standards Act's Exemptions for Executive,
    Administrative, Professional, Outside Sales, and Computer Employees
    (Apr. 24, 2024), https://www.dol.gov/agencies/whd/overtime/rulemaking/
    small-entity-compliance-guide.
        \2\29 U.S.C. Sec.  203(g).
    ---------------------------------------------------------------------------

                                  REGULAR RATE

        Overtime must be paid at one-and-one-half times the
    employee's regular rate of pay for each hour over 40 worked in
    a workweek. An employee's regular rate includes all payments
    made by the employer to or on behalf of the employee, with some
    statutorily mandated exclusions.
        The formula for computing the regular rate is the
    compensation in the workweek (except for statutory exclusions)
    divided by the total hours worked in the workweek. The
    following are exclusions from the regular rate:
               Gifts and payments in the nature of gifts on
            special occasions (may not be dependent on the number
            of hours worked);
               Payments for occasional periods when no work
            is performed due to vacation, holidays, illness,
            reimbursable business expenses, and other similar
            payments;
               Discretionary bonuses;
               Payments made pursuant to a profit-sharing
            plan or a thrift savings plan;
               Contributions to benefit plans such as life
            or disability insurance or other events that could
            cause significant financial hardship;
               Premium pay that is triggered due to reasons
            other than FLSA-mandated overtime, i.e., extra
            compensation for working on weekends, holidays, or days
            of rest; and
               Certain employee stock options.\3\
    ---------------------------------------------------------------------------
        \3\U.S. Dep't of Lab., Wage & Hour Div., Fact Sheet #56A: Overview
    of the Regular Rate of Pay Under the Fair Labor Standards Act (FLSA),
    https://www.dol.gov/agencies/whd/fact-sheets/56a-regular-rate.
    ---------------------------------------------------------------------------

                               FLSA MODERNIZATION

        On March 25, 2025, the Subcommittee on Workforce
    Protections held a hearing on ``The Future of Wage Laws:
    Assessing the FLSA's Effectiveness, Challenges, and
    Opportunities.'' Witnesses testified about how the FLSA, with
    no major legislative updates since its enactment 87 years ago,
    has failed to keep pace with the modern workforce. Witnesses
    also suggested legislative solutions to make the FLSA less
    rigid and remove employer disincentives that currently limit an
    hourly employee's ability to receive certain non-wage benefits.
    Witnesses further testified that the FLSA should alter outdated
    standards which prevent employers from providing benefits such
    as child care to employees.
        At the March 25, 2025, hearing, Ms. Tammy McCutchen, former
    U.S. Department of Labor Wage and Hour Division Administrator,
    testified that the way an hourly employee's regular rate for
    overtime pay is calculated has not been changed legislatively
    in 76 years, except for a 2000 update to exclude certain stock
    options from the regular rate.\4\ She recommended amending FLSA
    Section 7(e) to exclude other non-wage benefits from regular
    rate calculations to encourage employers to provide benefits
    and increase access to benefits for workers. She also testified
    that such a change would allow private sector employers to more
    easily provide child care for their employees.\5\
    ---------------------------------------------------------------------------
        \4\The Future of Wage Laws: Assessing the FLSA's Effectiveness,
    Challenges, and Opportunities: Hearing Before the Subcomm. on Workforce
    Protections of the H. Comm. on Educ. & Workforce, 119th Cong. (2025)
    (written statement of Tammy McCutchen, Senior Affiliate, Resolution
    Econ., at 3).
        \5\Id. (testimony of Tammy McCutchen, Senior Affiliate, Resolution
    Econ.) (``would free employers to provide child care'').
    ---------------------------------------------------------------------------
        At the same hearing, Mr. Jonathan Wolfson, former Assistant
    Secretary of Labor for Policy during the first Trump
    Administration, highlighted the need to remove barriers that
    allow employees to access to child care:

              Without employer-provided assistance, many workers
            struggle with the high costs of child and elder care.
            This financial strain often forces employees--
            particularly women--to reduce work hours or leave the
            workforce entirely. By removing barriers to employer-
            sponsored caregiving benefits, [H.R. 2270] would
            encourage more businesses to provide assistance,
            helping workers remain in their jobs while managing
            caregiving responsibilities. This bill could both
            support families and improve workforce participation,
            all while benefiting the businesses that hire workers
            who need these benefits.\6\
    ---------------------------------------------------------------------------
        \6\Id. (written statement of Jonathan Wolfson, Chief Legal Off. &
    Pol'y Dir., Cicero Inst., at 7).

        In addition, Ms. Emily M. Dickens from SHRM stated
    regarding the Empowering Employer Child and Elder Care
    Solutions Act that ``H.R. 2270 represents meaningful progress
    by encouraging employers to offer onsite or subsidized
    dependent care benefits through statutory recognition that such
    benefits are excluded from the `regular rate' calculation under
    the FLSA.''\7\
    ---------------------------------------------------------------------------
        \7\Letter from Emily M. Dickens, Chief of Staff, Head of Gov't
    Pol'y, & Corp. Sec'y, SHRM, to Chairman Tim Walberg & Ranking Member
    Bobby Scott, Comm. on Educ. & Workforce (Apr. 8, 2025) (on file with
    Comm.).
    ---------------------------------------------------------------------------

             EMPOWERING EMPLOYER CHILD AND ELDER CARE SOLUTIONS ACT

        On March 21, Representatives Mark Messmer (R-IN) and Josh
    Harder (D-CA) introduced H.R. 2270, the Empowering Employer
    Child and Elder Care Solutions Act, which was referred solely
    to the Committee on Education and Workforce. This bill amends
    FLSA Section 7(e) to exclude the value of employer-funded child
    or dependent care from the calculation of an eligible
    employee's overtime pay. Under current law, overtime hours must
    be paid at time-and-one-half of an employee's regular rate of
    pay. The regular rate is an average hourly rate that must
    include certain types of compensation, such as commissions,
    incentive pay, and certain non-cash payments. The bill
    specifies that an employer can provide or pay for child or
    dependent care services without the value of these services
    being included in this calculation.

                                   CONCLUSION

        Workers and businesses benefit from easy-to-understand
    wage-and-hour rules--and they struggle with impossible
    compliance burdens and red tape. Former Wage and Hour
    Administrator Tammy McCutchen stated at the March 25, 2025,
    Workforce Protections Subcommittee hearing: ``we need clear and
    simple rules that small businesses and workers can understand
    without an attorney or HR professionals.''\8\ Excluding child
    and dependent care from regular rate calculations is an
    important step toward modernizing the FLSA and making it work
    better for 21st century workers and families.
    ---------------------------------------------------------------------------
        \8\The Future of Wage Laws: Assessing the FLSA's Effectiveness,
    Challenges, and Opportunities: Hearing Before the Subcomm. on Workforce
    Protections of the H. Comm. on Educ. & Workforce, 119th Cong. (2025)
    (written statement of Tammy McCutchen, Senior Affiliate, Resolution
    Econ., at 3).
    ---------------------------------------------------------------------------

                               H.R. 2270 Summary

        H.R. 2270 amends the FLSA to exclude any child or dependent
    care services provided by the employer from regular rate
    calculations.

                      H.R. 2270 Section-by-Section Summary

    Section 1--Short title

        Names the bill the Empowering Employer Child and Elder Care
    Solutions Act.

    Section 2--Exclusion of child and dependent care in computing overtime
            compensation

        Section 2 amends FLSA Section 7(e) to expand the definition
    of ``regular rate'' to exclude payments or reimbursements for
    child or dependent care services or the value of any child or
    dependent care services provided by the employer. It also
    directs this change to apply to overtime compensation paid for
    workweeks beginning on or after the date of the bill's
    enactment.

             Statement of General Performance Goals and Objectives

        In accordance with clause (3)(c) of rule XIII of the Rules
    of the House of Representatives, the goal of H.R. 2270 is to
    exclude child and dependent care services and payments from the
    rate used to compute overtime compensation under the Fair Labor
    Standards Act of 1938.

                           Explanation of Amendments

        The amendment in the nature of a substitute is explained in
    the body of this report.

                  Application of Law to the Legislative Branch

        Section 102(b)(3) of Public Law 104-1 requires a
    description of the application of this bill to the legislative
    branch. H.R. 2270 amends the Fair Labor Standards Act of 1938
    to exclude child and dependent care services and payments from
    the rate used to compute overtime compensation for employees,
    including eligible employees of the legislative branch.

                           Unfunded Mandate Statement

        Pursuant to Section 423 of the Congressional Budget and
    Impoundment Control Act of 1974, Pub. L. No. 93-344 (as amended
    by Section 101(a)(2) of the Unfunded Mandates Reform Act of
    1995, Pub. L. No. 104-4), the Committee adopts as its own the
    cost estimate prepared by the Director of the Congressional
    Budget Office (CBO) pursuant to section 402 of the
    Congressional Budget and Impoundment Control Act of 1974.

                               Earmark Statement

        H.R. 2270 does not contain any congressional earmarks,
    limited tax benefits, or limited tariff benefits as defined in
    clause 9 of House rule XXI.

                                Roll Call Votes

        Clause 3(b) of rule XIII of the Rules of the House of
    Representatives requires the Committee Report to include for
    each record vote on a motion to report the measure or matter
    and on any amendments offered to the measure or matter the
    total number of votes for and against and the names of the
    Members voting for and against.

             Statement of General Performance Goals and Objectives

        In accordance with clause (3)(c) of House rule XIII, the
    goal of H.R. 2270, is to amend the Fair Labor Standards Act of
    1938 to exclude child and dependent care services and payments
    from the rate used to compute overtime compensation.

                        Duplication of Federal Programs

        No provision of H.R. 2270 establishes or reauthorizes a
    program of the Federal Government known to be duplicative of
    another Federal program, a program that was included in any
    report from the Government Accountability Office to Congress
    pursuant to section 21 of Public Law 111-139, or a program
    related to a program identified in the most recent Catalog of
    Federal Domestic Assistance.

              Statement of Oversight Findings and Recommendations
                                of the Committee

        In compliance with clause 3(c)(1) of rule XIII and clause
    2(b)(1) of rule X of the Rules of the House of Representatives,
    the committee's oversight findings and recommendations are
    reflected in the body of this report.

                           Required Committee Hearing

        In compliance with clause 3(c)(6) of rule XIII the
    following hearing held during the 119th Congress was used to
    develop or consider H.R. 2270: On March 25, 2025, the Committee
    on Education and Workforce Subcommittee on Workforce
    Protections held a hearing on ``The Future of Wage Laws:
    Assessing the FLSA's Effectiveness, Challenges, and
    Opportunities.''

                   New Budget Authority and CBO Cost Estimate

        With respect to the requirements of clause 3(c)(2) of rule
    XIII of the Rules of the House of Representatives and section
    308(a) of the Congressional Budget Act of 1974 and with respect
    to requirements of clause 3(c)(3) of rule XIII of the Rules of
    the House of Representatives and section 402 of the
    Congressional Budget Act of 1974, the Committee adopts as its
    own the cost estimate for the bill prepared by the Director of
    the Congressional Budget Office.

        Summary of legislation: On April 9, 2025, the House
    Committee on Education and the Workforce ordered reported four
    bills and one joint resolution. This document provides
    estimates for two of those bills, H.R. 2262 and H.R. 2270. Both
    bills would amend the Fair Labor Standards Act (FLSA), which
    establishes minimum wage, overtime pay, and other standards
    affecting most private and public-sector employees.
               H.R. 2262, the Flexibility for Workers
            Education Act, would exclude time spent on certain
            activities from counting as work time under the FLSA.
            Under current law, attendance at activities such as
            lectures and training programs do not need to be
            counted as work time if attendance is voluntary and
            outside of employee's working hours, the activity is
            unrelated to the employee's job, and the employee did
            not perform any productive work. H.R. 2262 would remove
            the criteria that the activity be unrelated to the
            employee's job.
               H.R. 2270, the Empowering Employer Child and
            Elder Care Solutions Act, would exclude payments or
            reimbursements for child and dependent care services
            from the computation of overtime compensation under the
            FLSA.
        Estimated Federal cost: The costs of the legislation fall
    within budget function 500 (education, training, employment,
    and social services).
        Basis of estimate: For this estimate, CBO assumes that the
    bills will be enacted before the end of fiscal year 2025. This
    estimate does not include any effects of interactions among the
    bills. If both bills were combined and enacted as a single
    piece of legislation, the estimated costs would be different,
    but the total increase in the deficit would still be less than
    $500,000 over the 2025-2035 period.
        Both H.R. 2262 and H.R. 2270 amend the FLSA. That law
    authorizes the Department of Labor (DOL) to impose and collect
    civil monetary penalties from employers that violate it. Such
    penalties are recorded in the federal budget as revenues, and a
    portion can be spent without further appropriation. DOL
    typically collects less than $10 million per year in civil
    monetary penalties for FLSA violations.
        Enacting each of the bills would result in fewer entities
    being subject to those penalties. CBO estimates that the
    reduction in amounts collected would be small and that the
    decrease in revenues and direct spending, and the resulting net
    increase in the deficit would be less than $500,000 over the
    2025-2035 period.
        Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
    Act of 2010 establishes budget-reporting and enforcement
    procedures for legislation affecting direct spending or
    revenues. CBO estimates that enacting each of the bills would
    decrease direct spending and revenues by less than $500,000
    over the 2025-2035 period.
        Increase in long-term net direct spending and deficits: CBO
    estimates that enacting H.R. 2262 and H.R. 2270 would not
    significantly increase net direct spending in any of the four
    consecutive 10-year periods beginning in 2036.
        CBO estimates that enacting H.R. 2262 and H.R. 2270 would
    not significantly increase on-budget deficits in any of the
    four consecutive 10-year periods beginning in 2036.
        Mandates: Neither bill contains an intergovernmental or
    private-sector mandate as defined in the Unfunded Mandates
    Reform Act.
        Estimate prepared by: Federal costs: Meredith Decker;
    Revenues: Joshua Shakin; Mandates: Erich Dvorak.
        Estimate reviewed by: Elizabeth Cove Delisle, Chief, Income
    Security Cost Estimates Unit; Joshua Shakin, Chief, Revenue
    Projections Unit; Kathleen FitzGerald, Chief, Public and
    Private Mandates Unit; Christina Hawley Anthony, Deputy
    Director of Budget Analysis.
        Estimate approved by: Phillip L. Swagel, Director,
    Congressional Budget Office.

                            Committee Cost Estimate

        Clause 3(d)(1) of rule XIII of the Rules of the House of
    Representatives requires an estimate and a comparison of the
    costs that would be incurred in carrying out H.R. 2270.
    However, clause 3(d)(2)(B) of that rule provides that this
    requirement does not apply when, as with the present report,
    the Committee adopts as its own the cost estimate for the bill
    prepared by the Director of the Congressional Budget Office.

             Changes in Existing Law Made by the Bill, as Reported

      In compliance with clause 3(e) of rule XIII of the Rules of
    the House of Representatives, changes in existing law made by
    the bill, as reported, are shown as follows (existing law
    proposed to be omitted is enclosed in black brackets, new
    matter is printed in italics, and existing law in which no
    change is proposed is shown in roman):

                        FAIR LABOR STANDARDS ACT OF 1938

               *       *       *       *       *       *       *
                                 maximum hours

      Sec. 7. (a)(1) Except as otherwise provided in this section,
    no employer shall employ any of his employees who in any
    workweek is engaged in commerce or in the production of goods
    for commerce, or is employed in an enterprise engaged in
    commerce or in the production of goods for commerce, for a
    workweek longer than forty hours unless such employee receives
    compensation for his employment in excess of the hours above
    specified at a rate not less than one and one-half times the
    regular rate at which he is employed.
      (2) No employer shall employ any of his employees who in any
    workweek is engaged in commerce or in the production of goods
    for commerce, or is employed in an enterprise engaged in
    commerce or in the production of goods for commerce, and who in
    such workweek is brought within the purview of this subsection
    by the amendments made to this Act by the Fair Labor Standards
    Amendments of 1966--
              (A) for a workweek longer than forty-four hours
            during the first year from the effective date of the
            Fair Labor Standards Amendments of 1966,
              (B) for a workweek longer than forty-two hours during
            the second year from such date, or
              (C) for a workweek longer than forty hours after the
            expiration of the second year from such date,
    unless such employee receives compensation for his employment
    in excess of the hours above specified at a rate not less than
    one and one-half times the regular rate at which he is
    employed.
      (b) No employer shall be deemed to have violated subsection
    (a) by employing any employee for a workweek in excess of that
    specified in such subsection without paying the compensation
    for overtime employment prescribed therein if such employee is
    so employed--
              (1) in pursuance of an agreement, made as a result of
            collective bargaining by representatives of employees
            certified as bona fide by the National Labor Relations
            Board, which provides that no employee shall be
            employed more than one thousand and forty hours during
            any period of twenty-six consecutive weeks, or
              (2) in pursuance of an agreement, made as a result of
            collective bargaining by representatives of employees
            certified as bona fide by the National Labor Relations
            Board which provides that during a specified period of
            fifty-two consecutive weeks the employee shall be
            employed not more than two thousand two hundred and
            forty hours and shall be guaranteed not less than one
            thousand eight hundred and forty hours (or not less
            than forty-six weeks at the normal number of hours
            worked per week, but not less than thirty hours per
            week) and not more than two thousand and eighty hours
            of employment for which he shall receive compensation
            for all hours guaranteed or worked at rates not less
            than those applicable under the agreement to the work
            performed and for all hours in excess of the guaranty
            which are also in excess of the maximum workweek
            applicable to such employee under subsection (a) or two
            thousand and eighty in such period at rates not less
            than one and one-half times the regular rate at which
            he is employed; or
              (3) by an independently owned and controlled local
            enterprise (including an enterprise with more than one
            bulk storage establishment) engaged in the wholesale or
            bulk distribution of petroleum products if--
                      (A) the annual gross volume of sales of such
                    enterprise is less than $1,000,000 exclusive of
                    excise taxes.
                      (B) more than 75 per centum of such
                    enterprise's annual dollar volume of sales is
                    made within the State in which such enterprise
                    is located, and
                      (C) not more than 25 per centum of the annual
                    dollar volume of sales of such enterprise is to
                    customers who are engaged in the bulk
                    distribution of such products for resale;
    and if such employee receives compensation for employment in
    excess of twelve hours in any workday, or for employment in
    excess of fifty-six hours in any workweek, as the case may be,
    at a rate not less than one and one-half times the regular rate
    at which he is employed.
      (e) As used in this section the ``regular rate'' at which an
    employee is employed shall be deemed to include all
    remuneration for employment paid to, or on behalf of, the
    employee, but shall not be deemed to include--
              (1) sums paid as gifts; payments in the nature of
            gifts made at Christmas time or on other special
            occasions, as a reward for service, the amounts of
            which are not measured by or dependent on hours worked,
            production, or efficiency;
              (2) payments made for occasional periods when no work
            is performed due to vacation, holiday, illness, failure
            of the employer to provide sufficient work or other
            similar cause; reasonable payments for traveling
            expenses, or other expenses, incurred by an employee in
            the furtherance of his employer's interests and
            properly reimburseable by the employer; payments or
            reimbursements for child or dependent care services;
            and other similar payments to any employee which are
            not made as compensation for his hours of employment;
              (3) sums paid in recognition of services performed
            during a given period if either, (a) both the fact that
            payment is to be made and the amount of the payment are
            determined at the sole discretion of the employer at or
            near the end of the period and not pursuant to any
            prior contract, agreement, or promise causing the
            employee to expect such payments regularly; or (b) the
            payments are made pursuant to a bona fide profit-
            sharing plan or trust or bona fide thrift or savings
            plan, meeting the requirements of the Secretary of
            Labor set forth in appropriate regulations which he
            shall issue, having due regard among other relevant
            facts, to the extent to which the amounts paid to the
            employee are determined without regard to hours of
            work, production, or efficiency; or (c) the payments
            are talent fees (as such talent fees are defined and
            delimited by regulations of the Secretary) paid to
            performers, including announcers, on radio and
            television programs;
              (4) contributions irrevocably made by an employer to
            a trustee or third person pursuant to a bona fide plan
            for providing old-age retirement, life, accident, or
            health insurance or similar benefits for employees;
              (5) extra compensation provided by a premium rate
            paid for certain hours worked by the employee in any
            day or workweek because such hours are hours worked in
            excess of eight in a day or in excess of the maximum
            workweek applicable to such employee under subsection
            (a) or in excess of the employee's normal working hours
            or regular working hours, as the case may be;
              (6) extra compensation provided by a premium rate
            paid for work by the employee on Saturdays, Sundays,
            holidays, or regular days of rest, or on the sixth or
            seventh day of the workweek, where such premium rate is
            not less than one and one-half times the rate
            established in good faith for like work performed in
            nonovertime hours on other days;
              (7) extra compensation provided by a premium rate
            paid to the employee, in pursuance of an applicable
            employment contract or collective-bargaining agreement,
            for work outside of the hours established in good faith
            by the contract or agreement as the basic, normal, or
            regular workday (not exceeding eight hours) or workweek
            (not exceeding the maximum workweek applicable to such
            employee under subsection (a)), where such premium rate
            is not less than one and one-half times the rate
            established in good faith by the contract or agreement
            for like work performed during such workday or
            workweek; [or]
              (8) any value or income derived from employer-
            provided grants or rights provided pursuant to a stock
            option, stock appreciation right, or bona fide employee
            stock purchase program which is not otherwise
            excludable under any of paragraphs (1) through (7) if--
                      (A) grants are made pursuant to a program,
                    the terms and conditions of which are
                    communicated to participating employees either
                    at the beginning of the employee's
                    participation in the program or at the time of
                    the grant;
                      (B) in the case of stock options and stock
                    appreciation rights, the grant or right cannot
                    be exercisable for a period of at least 6
                    months after the time of grant (except that
                    grants or rights may become exercisable because
                    of an employee's death, disability, retirement,
                    or a change in corporate ownership, or other
                    circumstances permitted by regulation), and the
                    exercise price is at least 85 percent of the
                    fair market value of the stock at the time of
                    grant;
                      (C) exercise of any grant or right is
                    voluntary; and
                      (D) any determinations regarding the award
                    of, and the amount of, employer-provided grants
                    or rights that are based on performance are--
                              (i) made based upon meeting
                            previously established performance
                            criteria (which may include hours of
                            work, efficiency, or productivity) of
                            any business unit consisting of at
                            least 10 employees or of a facility,
                            except that, any determinations may be
                            based on length of service or minimum
                            schedule of hours or days of work; or
                              (ii) made based upon the past
                            performance (which may include any
                            criteria) of one or more employees in a
                            given period so long as the
                            determination is in the sole discretion
                            of the employer and not pursuant to any
                            prior contract[.]; or
              (9) the value of any child or dependent care services
            provided by an employer.
      (f) No employer shall be deemed to have violated subsection
    (a) by employing any employee for a workweek in excess of the
    maximum workweek applicable to such employee under subsection
    (a) if such employee is employed pursuant to a bona fide
    individual contract, or pursuant to an agreement made as a
    result of collective bargaining by representatives of
    employees, if the duties of such employee necessitate irregular
    hours of work, and the contract or agreement (1) specifies a
    regular rate of pay of not less than the minimum hourly rate
    provided in subsection (a) or (b) of section 6 (whichever may
    be applicable) and compensation at not less than one and one-
    half times such rate for all hours worked in excess of such
    maximum workweek, and (2) provides a weekly guaranty of pay for
    not more than sixty hours based on the rates so specified.
      (g) No employer shall be deemed to have violated subsection
    (a) by employing any employee for a workweek in excess of the
    maximum workweek applicable to such employee under such
    subsection if, pursuant to an agreement or understanding
    arrived at between the employer and the employee before
    performance of the work, the amount paid to the employee for
    the number of hours worked by him in such workweek in excess of
    the maximum workweek applicable to such employee under such
    subsection--
              (1) in the case of an employee employed at piece
            rates, is computed at piece rates not less than one and
            one-half times the bona fide piece rates applicable to
            the same work when performed during nonovertime hours;
            or
              (2) in the case of an employee performing two or more
            kinds of work for which different hourly or piece rates
            have been established, is computed at rates not less
            than one and one-half times such bona fide rates
            applicable to the same work when performed during
            nonovertime hours; or
              (3) is computed at a rate not less than one and one-
            half times the rate established by such agreement or
            understanding as the basic rate to be used in computing
            overtime compensation thereunder: Provided, That the
            rate so established shall be authorized by regulation
            by the Secretary of Labor as being substantially
            equivalent to the average hourly earnings of the
            employee, exclusive of overtime premiums, in the
            particular work over a representative period of time;
    and if (i) the employee's average hourly earnings for the
    workweek exclusive of payments described in paragraphs (1)
    through (7) of subsection (e) are not less than the minimum
    hourly rate required by applicable law, and (ii) extra overtime
    compensation is properly computed and paid on other forms of
    additional pay required to be included in computing the regular
    rate.
      (h)(1) Except as provided in paragraph (2), sums excluded
    from the regular rate pursuant to subsection (e) shall not be
    creditable toward wages required under section 6 or overtime
    compensation required under this section.
      (2) Extra compensation paid as described in paragraphs (5),
    (6), and (7) of subsection (e) shall be creditable toward
    overtime compensation payable pursuant to this section.
      (i) No employer shall be deemed to have violated subsection
    (a) by employing any employee of a retail or service
    establishment for a workweek in excess of the applicable
    workweek specified therein, if (1) the regular rate of pay of
    such employee is in excess of one and one-half times the
    minimum hourly rate applicable to him under section 6, and (2)
    more than half his compensation for a representative period
    (not less than one month) represents commissions on goods or
    services. In determining the proportion of compensation
    representing commissions, all earnings resulting from the
    application of a bona fide commission rate shall be deemed
    commissions on goods or services without regard to whether the
    computed commissions exceed the draw or guarantee.
      (j) No employer engaged in the operation of a hospital or an
    establishment which is an institution primarily engaged in the
    care of the sick, the aged, or the mentally ill or defective
    who reside on the premises shall be deemed to have violated
    subsection (a) if, pursuant to an agreement or understanding
    arrived at between the employer and the employee before
    performance of the work, a work period of fourteen consecutive
    days is accepted in lieu of the workweek of seven consecutive
    days for purposes of overtime computation and if, for his
    employment in excess of eight hours in any workday and in
    excess of eighty hours in such fourteen-day period, the
    employee receives compensation at a rate of not less than one
    and one-half times the regular rate at which he is employed.
      (k) No public agency shall be deemed to have violated
    subsection (a) with respect to the employment of any employee
    in fire protection activities or any employee in law
    enforcement activities (including security personnel in
    correctional institutions) if--
              (1) in a work period of 28 consecutive days the
            employee receives for tours of duty which in the
            aggregate exceed the lesser of (A) 216 hours, or (B)
            the average number of hours (as determined by the
            Secretary pursuant to section 6(c)(3) of the Fair Labor
            Standards Amendments of 1974) in tours of duty of
            employees engaged in such activities in work periods of
            28 consecutive days in calendar year 1975; or
              (2) in the case of such employee to whom a work
            period of at least 7 but less than 28 days applies, in
            his work period the employee receives for tours of duty
            which in the aggregate exceed a number of hours which
            bears the same ratio to the number of consecutive days
            in his work period as 216 hours (or if lower, the
            number of hours referred to in clause (B) of paragraph
            (1)) bears to 28 days;
    compensation at a rate not less than one and one-half times the
    regular rate at which he is employed.
      (l) No employer shall employ any employee in domestic service
    in one or more households for a workweek longer than forty
    hours unless such employee receives compensation for such
    employment in accordance with subsection (a).
      (m) For a period or periods of not more than fourteen
    workweeks in the aggregate in any calendar year, any employer
    may employ any employee for a workweek in excess of that
    specified in subsection (a) without paying the compensation for
    overtime employment prescribed in such subsection, if such
    employee--
              (1) is employed by such employer--
                      (A) to provide services (including stripping
                    and grading) necessary and incidental to the
                    sale at auction of green leaf tobacco of type
                    11, 12, 13, 14, 21, 22, 23, 24, 31, 35, 36, or
                    37 (as such types are defined by the Secretary
                    of Agriculture), or in auction sale, buying,
                    handling, stemming, redrying, packing, and
                    storing of such tobacco,
                      (B) in auction sale, buying, handling,
                    sorting, grading, packing, or storing green
                    leaf tobacco of type 32 (as such type is
                    defined by the Secretary of Agriculture), or
                      (C) in auction sale, buying, handling,
                    stripping, sorting, grading, sizing, packing,
                    or stemming prior to packing, of perishable
                    cigar leaf tobacco of type 41, 42, 43, 44, 45,
                    46, 51, 52, 53, 54, 55, 61, or 62 (as such
                    types are defined by the Secretary of
                    Agriculture); and
              (2) receives for--
                      (A) such employment by such employer which is
                    in excess of ten hours in any workday, and
                      (B) such employment by such employer which is
                    in excess of forty-eight hours in any workweek,
            compensation at a rate not less than one and one-half
            times the regular rate at which he is employed.
    An employer who receives an exemption under this subsection
    shall not be eligible for any other exemption under this
    section.
      (n) In the case of an employee of an employer engaged in the
    business of operating a street, suburban or interurban electric
    railway or local trolley or motorbus carrier (regardless of
    whether or not such railway or carrier is public or private or
    operated for profit or not for profit), in determining the
    hours of employment of such an employee to which the rate
    prescribed by subsection (a) applies there shall be excluded
    the hours such employee was employed in charter activities by
    such employer if (1) the employee's employment in such
    activities was pursuant to an agreement or understanding with
    his employer arrived at before engaging in such employment, and
    (2) if employment in such activities is not part of such
    employee's regular employment.
      (o)(1) Employees of a public agency which is a State, a
    political subdivision of a State, or an interstate governmental
    agency may receive, in accordance with this subsection and in
    lieu of overtime compensation, compensatory time off at a rate
    not less than one and one-half hours for each hour of
    employment for which overtime compensation is required by this
    section.
      (2) A public agency may provide compensatory time under
    paragraph (1) only--
              (A) pursuant to--
                      (i) applicable provisions of a collective
                    bargaining agreement, memorandum of
                    understanding, or any other agreement between
                    the public agency and representatives of such
                    employees; or
                      (ii) in the case of employees not covered by
                    subclause (i), an agreement or understanding
                    arrived at between the employer and employee
                    before the performance of the work; and
              (B) if the employee has not accrued compensatory time
            in excess of the limit applicable to the employee
            prescribed by paragraph (3).
    In the case of employees described in clause (A)(ii) hired
    prior to April 15, 1986, the regular practice in effect on
    April 15, 1986, with respect to compensatory time off for such
    employees in lieu of the receipt of overtime compensation,
    shall constitute an agreement or understanding under such
    clause (A)(ii). Except as provided in the previous sentence,
    the provision of compensatory time off to such employees for
    hours worked after April 14, 1986, shall be in accordance with
    this subsection.
      (3)(A) If the work of an employee for which compensatory time
    may be provided included work in a public safety activity, an
    emergency response activity, or a seasonal activity, the
    employee engaged in such work may accrue not more than 480
    hours of compensatory time for hours worked after April 15,
    1986. If such work was any other work, the employee engaged in
    such work may accrue not more than 240 hours of compensatory
    time for hours worked after April 15, 1986. Any such employee
    who, after April 15, 1986, has accrued 480 or 240 hours, as the
    case may be, of compensatory time off shall, for additional
    overtime hours of work, be paid overtime compensation.
      (B) If compensation is paid to an employee for accrued
    compensatory time off, such compensation shall be paid at the
    regular rate earned by the employee at the time the employee
    receives such payment.
      (4) An employee who has accrued compensatory time off
    authorized to be provided under paragraph (1) shall, upon
    termination of employment, be paid for the unused compensatory
    time at a rate of compensation not less than--
              (A) the average regular rate received by such
            employee during the last 3 years of the employee's
            employment, or
              (B) the final regular rate received by such employee,
    whichever is higher
      (5) An employee of a public agency which is a State,
    political subdivision of a State, or an interstate governmental
    agency--
              (A) who has accrued compensatory time off authorized
            to be provided under paragraph (1), and
              (B) who has requested the use of such compensatory
            time,
    shall be permitted by the employee's employer to use such time
    within a reasonable period after making the request if the use
    of the compensatory time does not unduly disrupt the operations
    of the public agency.
      (6) The hours an employee of a public agency performs court
    reporting transcript preparation duties shall not be considered
    as hours worked for the purposes of subsection (a) if--
              (A) such employee is paid at a per-page rate which is
            not less than--
                      (i) the maximum rate established by State law
                    or local ordinance for the jurisdiction of such
                    public agency,
                      (ii) the maximum rate otherwise established
                    by a judicial or administrative officer and in
                    effect on July 1, 1995, or
                      (iii) the rate freely negotiated between the
                    employee and the party requesting the
                    transcript, other than the judge who presided
                    over the proceedings being transcribed, and
              (B) the hours spent performing such duties are
            outside of the hours such employee performs other work
            (including hours for which the agency requires the
            employee's attendance) pursuant to the employment
            relationship with such public agency.
    For purposes of this section, the amount paid such employee in
    accordance with subparagraph (A) for the performance of court
    reporting transcript preparation duties, shall not be
    considered in the calculation of the regular rate at which such
    employee is employed.
      (7) For purposes of this subsection--
              (A) the term ``overtime compensation'' means the
            compensation required by subsection (a), and
              (B) the terms ``compensatory time'' and
            ``compensatory time off'' mean hours during which an
            employee is not working, which are not counted as hours
            worked during the applicable workweek or other work
            period for purposes of overtime compensation, and for
            which the employee is compensated at the employee's
            regular rate.
      (p)(1) If an individual who is employed by a State, political
    subdivision of a State, or an interstate governmental agency in
    fire protection or law enforcement activities (including
    activities of security personnel in correctional institutions)
    and who, solely at such individual's option, agrees to be
    employed on a special detail by a separate or independent
    employer in fire protection, law enforcement, or related
    activities, the hours such individual was employed by such
    separate and independent employer shall be excluded by the
    public agency employing such individual in the calculation of
    the hours for which the employee is entitled to overtime
    compensation under this section if the public agency--
              (A) requires that its employees engaged in fire
            protection, law enforcement, or security activities be
            hired by a separate and independent employer to perform
            the special detail,
              (B) facilitates the employment of such employees by a
            separate and independent employer, or
              (C) otherwise affects the condition of employment of
            such employees by a separate and independent employer.
      (2) If an employee of a public agency which is a State,
    political subdivision of a State, or an interstate governmental
    agency undertakes, on an occasional or sporadic basis and
    solely at the employee's option, part-time employment for the
    public agency which is in a different capacity from any
    capacity in which the employee is regularly employed with the
    public agency, the hours such employee was employed in
    performing the different employment shall be excluded by the
    public agency in the calculation of the hours for which the
    employee is entitled to overtime compensation under this
    section.
      (3) If an individual who is employed in any capacity by a
    public agency which is a State, political subdivision of a
    State, or an interstate governmental agency, agrees, with the
    approval of the public agency and solely at the option of such
    individual, to substitute during scheduled work hours for
    another individual who is employed by such agency in the same
    capacity, the hours such employee worked as a substitute shall
    be excluded by the public agency in the calculation of the
    hours for which the employee is entitled to overtime
    compensation under this section.
      (q) Any employer may employ any employee for a period or
    periods of not more than 10 hours in the aggregate in any
    workweek in excess of the maximum workweek specified in
    subsection (a) without paying the compensation for overtime
    employment prescribed in such subsection, if during such period
    or periods the employee is receiving remedial education that
    is--
              (1) provided to employees who lack a high school
            diploma or educational attainment at the eighth grade
            level;
              (2) designed to provide reading and other basic
            skills at an eighth grade level or below; and
              (3) does not include job specific training.

               *       *       *       *       *       *       *

                                 MINORITY VIEWS

                                  INTRODUCTION

        H.R. 2270, the Empowering Employer Child and Elder Care
    Solutions Act, would allow employers to pay their workers less
    overtime than they are owed by excluding child and dependent
    care services and payments from the rate used to compute
    overtime compensation. It would contradict the basic premise,
    going back to 1938, that employers should be disincentivized
    from requiring employees to work overtime hours. As a result,
    it would--in the name of incentivizing child and elder
    subsidies--actually drive up workers' child and elder costs.

                                   BACKGROUND

    Underlying Law
        The Fair Labor Standards Act of 1938 (FLSA) is the core
    federal workplace standards law governing minimum wage,
    overtime, oppressive child labor, and other fundamental
    workplace standards.\1\ FLSA is enforced by both the Wage and
    Hour Division (WHD) of the U.S. Department of Labor (DOL) as
    well as private litigants.\2\
    ---------------------------------------------------------------------------
        \1\Pub. L. No. 75-718, 52 Stat. 1060 (1938) (codified at 29 U.S.C.
    Sec. 201 et seq.).
        \2\Id. Sec. 16.
    ---------------------------------------------------------------------------
        Section 7 of FLSA establishes maximum work week provisions
    at 40 hours per week.\3\ Any employer who requires employees to
    work in excess of 40 hours per week is required to pay an
    overtime premium of 1.5 times the employees' regular rate of
    pay.\4\ FLSA includes many exemptions\5\ and special provisions
    for particular workplaces.\6\ For convenience, this discussion
    will use the term ``employee'' to mean non-exempt employees and
    will focus on the paradigmatic case of hourly workers in
    typical private-sector jobs.
    ---------------------------------------------------------------------------
        \3\Id. Sec. 7(a)(1).
        \4\Id.
        \5\See, e.g., id. Sec. Sec. 13(a)(1) (bona fide executive,
    administrative, and professional employees), 13(a)(5) (aquaculture and
    fishing employees), 13(a)(6) (many kinds of agricultural and livestock
    workers), 13(b) (interstate transportation workers).
        \6\See, e.g., id. Sec. 7(j) (permitting hospital and care
    facilities to apply overtime on a 14-day rather than seven-day work
    period), 7(k) (special rules for public-sector employees in fire
    protection and policing), 7(m) (seasonal exemption for tobacco-related
    workers), 7(o) (special compensatory time option for public employers).
    ---------------------------------------------------------------------------
    Regular Rate
        Pursuant to FLSA, the overtime premium of ``time and a
    half'' is not merely 1.5 times the hourly wage but, instead,
    1.5 times the ``regular rate at which [the employee] is
    employed.''\7\ The regular rate ``include[s] all remuneration
    for employment,'' other than eight exceptions specified in
    section 7(e), including Christmas bonuses, paid time off,
    profit-sharing payouts, insurance or retirement benefits,
    Sunday or holiday work premiums, and stock options.\8\
    ---------------------------------------------------------------------------
        \7\Id. Sec. 7(a)(1). Additionally, the term ``wage'' is itself
    broad, defined as ``includ[ing] the reasonable cost, as determined by
    the [WHD] Administrator, to the employer of furnishing such employee
    with board, lodging, or other facilities, if such board, lodging or
    other facilities are customarily furnished by such employer to his
    employees,'' subject to some exclusions. Id. Sec. 3(m).
        \8\Id. Sec. 7(e).
    ---------------------------------------------------------------------------
        Within this list of exceptions, section 7(e)(2) specifies
    several payments paid to or on behalf of the employee that are
    excluded from the calculation of the regular rate.\9\ It
    includes occasional periods where the employee does not work
    due to vacation, holiday, sickness, the employer's failure to
    provide sufficient work, or other similar causes; reasonable
    payments for travel expenses the employee incurs for business
    travel; and other ``similar payments to an employee which are
    not made as compensation for [their] hours of employment.''\10\
    ---------------------------------------------------------------------------
        \9\Id. Sec. 7(e)(2).
        \10\Id.
    ---------------------------------------------------------------------------
        The entire universe of rules, read together, can seem
    daunting, but the complexity reflects the varieties of forms of
    employment, payment practices, and industry and occupational
    customs in the nation's economy. The overtime pay calculation
    boils down elegantly nonetheless:

              Total compensation in the workweek (except for
            statutory exclusions)  Total hours worked in the
            workweek = Regular Rate for the workweek.\11\
    ---------------------------------------------------------------------------
        \11\Wage & Hr. Div., Fact Sheet #56A: Overview of the Regular Rate
    of Pay Under the Fair Labor Standards Act (FLSA), U.S. Dep't of Lab.
    (Dec. 2019), https://www.dol.gov/agencies/whd/fact-sheets/56a-regular-
    rate.

        Some ``perks'' may be excluded by law, but a general
    principle applies: ``When a payment is a wage supplement, even
    if not directly related to employee performance or hours
    worked, it is still compensation for `hours of employment' and
    must be included in the regular rate.''\12\
    ---------------------------------------------------------------------------
        \12\Id.
    ---------------------------------------------------------------------------
    How Child and Dependent Care Benefits Are Considered in Regular Rate
        During the Reagan Administration, a WHD Opinion Letter
    explained that child care benefits, whether provided onsite or
    by a subsidy payment to the employee, are included in the
    regular rate. Presented with the scenario of an employer
    contracting for child care services and employees who receive
    the service paying for it by way of a paycheck deduction and/or
    receiving an employer subsidy, WHD concluded that such services
    should be incorporated into the regular rate of pay for
    purposes of overtime calculations. That a third-party
    contractor might be involved was irrelevant; as WHD explained,
    ``where an employer is directed by an employee to pay a sum for
    the benefit of the employee to a third party, such payment will
    be considered the same as payment to the employee, if the
    employer does not directly or indirectly derive any profit or
    benefit from the transaction.''\13\
    ---------------------------------------------------------------------------
        \13\Wage & Hr. Div., U.S. Dep't of Lab., Op. Ltr. No. FLSA-642
    (Jan. 23, 1983), https://www.dol.gov/sites/dolgov/files/WHD/opinion-
    letters/legacy/ol_1983-01-23_a.pdf.
    ---------------------------------------------------------------------------
        More recently, in the text accompanying a 2020 final rule
    on regular rate calculations, the Trump Administration
    distinguished between occasional, irregular, or emergency child
    care benefits and regularly provided benefits. In the
    explanatory matter, WHD considered the latter under FLSA
    Sec. 7(e)(2), which excludes from regular rate calculations the
    value of work travel reimbursements, payments made for
    occasional periods of nonwork such sick days, and ``other
    similar payments . . . not made as compensation for . . . hours
    of employment'':

              Several commenters [representing employer groups]
            asked [DOL] to clarify that childcare services or
            subsidies are excludable from the regular rate. . . .
            [DOL] has taken a broad view of what is considered to
            be a ``wage'' under 3(m) of the FLSA and as such, some
            payments for childcare services or subsidies may be
            considered a wage. Payments for childcare services or
            subsidies are excludable from the regular rate . . . to
            the extent such payments are not wages under section
            3(m). For instance, routinely-provided childcare
            qualifies as an in-kind reimbursement for ``expenses
            normally incurred by the employee for his own
            benefit,'' which are wages that must be included in the
            regular rate. However, emergency childcare services
            provided by employers as an important component of
            their work-life support packages do not meet this test
            and may be excluded from the regular rate, if such
            services are not provided as compensation for hours of
            employment. Emergency care is provided in the case of
            unforeseen circumstances, such as when schools or
            daycares are closed for bad weather or when a child is
            sick. If these payments are not tied to the quality or
            quantity of work performed, they are properly excluded
            from the regular rate under section 7(e)(2)'s ``other
            similar payments'' clause.\14\
    ---------------------------------------------------------------------------
        \14\Regular Rate Under the Fair Labor Standards Act, 84 Fed. Reg.
    68,736, 68,751 (Dec. 16, 2019).

        The Majority has not offered any explanation for diverging
    from the fundamental premise of the overtime provisions as they
    were written in 1938, interpreted with clarity in 1983, and
    persuasively explained as recently as 2020.

                        SHORTCOMINGS OF THE LEGISLATION

    Encouraging Excessive Work
        The enactment of FLSA's overtime provision in 1938 was the
    culmination of a decades-long effort to reduce overwork in the
    pre-1938 economy, particularly in the industrial sectors, where
    10- to 12-hour shifts were once routine.\15\ Labor movements
    rallying for limiting working hours and days were given a boost
    in their efforts due to labor shortages during World War I that
    gave workers more leverage to demand fewer hours and shorter
    work weeks, even leading to a brief ``golden age'' for American
    workers that included widespread adoption of the 8-hour work
    day.\16\ Post-World War I, industrialists attempted to roll
    back these gains and increase workers' hours but were met with
    fierce opposition from workers.\17\ Among the most commonly
    stated rationales for finally securing the 40-hour work week in
    FLSA were: (1) guaranteeing work/life balance--``[e]ight hours
    for work, eight hours for rest, eight hours for what you
    will;'' and (2) addressing the unemployment crisis of the Great
    Depression by incentivizing employers to hire additional
    workers to fill the gap left by shrinking shifts from 10 or 12
    hours to eight.\18\
    ---------------------------------------------------------------------------
        \16\Id.
        \17\Id.
        \18\Gillian Brockell, That Time America Almost Had a 30-Hour
    Workweek, Wash. Post (Sept. 6, 2021), https://www.washingtonpost.com/
    history/2021/09/06/40-hour-work-week-fdr/.
        \15\Dave Roos, The Origins of the Five-Day Work Week in America,
    History (Jan. 29, 2025), https://www.history.com/articles/five-day-
    work-week-labor-movement.
    ---------------------------------------------------------------------------
        The overriding purpose of FLSA's overtime provisions is not
    to reward excessive work but, instead, to discourage employers
    from demanding it. Any bill that exempts forms of compensation
    from the regular rate chips away at the disincentive that makes
    the 40-hour work week the rule rather than the exception.
    Perverse Incentives
        Although it is framed in terms of encouraging employers to
    offer more child and elder care support benefits, H.R. 2270
    would ultimately make it easier for employers to pay out less
    in overtime to workers precisely when--because the work week
    has stretched beyond 40 hours--workers are driven to need more,
    and more expensive, care. For these workers, care costs are
    likely to increase substantially.\19\
    ---------------------------------------------------------------------------
        \19\Who Provides Child Care During Nontraditional Hours?, Child
    Care Aware of America, https://info.childcareaware.org/hubfs/
    Who%20provides%20child%20care%20during%20
    nontraditional%20hours.pdf (last visited Apr. 17, 2025).
    ---------------------------------------------------------------------------
        That's assuming that care services are even available at
    all. As of 2018, 51 percent of Americans were living in child
    care deserts, defined as areas with little to no licensed child
    care capacity.\20\ For those who do have access, only eight
    percent of child care centers are open early (before 7:00 a.m.)
    or late (after 6:00 p.m.).\21\ Although regulated family child
    care homes (a small and declining share of the child care
    industry) ``tend to have more flexible hours than centers, two-
    thirds do not serve families during these hours.''\22\ Workers
    pushed into overtime hours may, as a result, turn to informal
    and unlicensed care options, but such options are not eligible
    for public child care assistance funds on which low-wage
    workers rely.\23\ Unlicensed child care options also come with
    safety risks to the child.\24\
    ---------------------------------------------------------------------------
        \20\Rasheed Malik, Katie Hamm & Leila Schochet, America's Child
    Care Deserts in 2018, Ctr. for Am. Progress (Dec. 6, 2018), https://
    www.americanprogress.org/article/americas-child-care-deserts-2018/.
        \21\Gina Adams et al., To Make the Child Care System More
    Equitable, Expand Options for Parents Working Nontraditional Hours,
    Urban Inst. (Jan. 14, 2021), https://www.urban.org/urban-wire/make-
    child-care-system-more-equitable-expand-options-parents-working-
    nontraditional-hour.
        \22\Id.
        \23\Id.
        \24\Danielle DaRos, I-Team: The Risks of Unregulated Childcare, CBS
    12 News (Sept. 17, 2024), https://cbs12.com/news/local/i-team-the-
    risks-of-unregulated-childcare-palm-beach-county-riviera-beach-health-
    department-daycare-tuesday-september-17-2024; Unlicensed Daycare
    Operator Charged with Aggravated Battery to a Child: Crystal Lake
    Police, NBC Chicago (Apr. 19, 2024), https://www.nbcchicago.com/news/
    local/unlicensed-daycare-operator-charged-with-
    aggravated-battery-to-a-child-crystal-lake-police/3415880/; Tony Sloan,
    Nashville Woman Charged in Death of 6-Month-Old Left in Her Unlicensed
    Daycare, News Channel 5 Nashville (Mar. 27, 2025), https://
    www.newschannel5.com/news/nashville-woman-charged-in-death-of-6-month-
    old-left-in-her-unlicensed-daycare.
    ---------------------------------------------------------------------------
        As the costs of care increase and become more unaffordable
    for more families, the burden of providing care services will
    fall disproportionately on women.\25\ The early days of the
    COVID-19 pandemic are a cautionary tale: when school closures
    and the collapse of child care infrastructure increased
    families' child care burdens, more women than men were forced
    to leave the labor force,\26\ and many of these working mothers
    never returned to the workforce full-time.\27\ The impact has
    been disproportionately felt in industries traditionally
    powered by women, including health care, education, and child
    care.\28\ For the child care industry in particular, the
    existing crisis triggered by the COVID-19 pandemic has devolved
    into a vicious cycle--absent accessible child care, mothers
    cannot return to work even if they want to, and the child care
    workforce will shrink further, making child care even less
    accessible.\29\
    ---------------------------------------------------------------------------
        \25\Nathan M. Stall et al., Unpaid Family Caregiving--The Next
    Frontier of Gender Equity in a Postpandemic Future, JAMA Health Forum
    (June 9, 2023), https://jamanetwork.com/journals/jama-health-forum/
    fullarticle/2805890.
        \26\Christine Michel Carter, Five Years Later, Working Mothers
    Continue to Leave the Workforce, Forbes (Mar. 29, 2025), https://
    www.forbes.com/sites/christinecarter/2025/03/29/five-years-later-
    working-mothers-continue-to-leave-the-workforce/.
        \27\Id.
        \28\Id.
        \29\Id.
    ---------------------------------------------------------------------------
    A Mirage of Benefits
        To the extent that the bill actually incentivizes employers
    to provide child and dependent care subsidies or services, it
    is not clear that employers would make a meaningful investment.
    Nothing in the bill requires employers to provide care benefits
    commensurate to the actual cost of such care. A worker might
    accept a meager care subsidy as better than nothing even if it
    falls significantly short of the cost of care. The employer,
    meanwhile, would be able to enjoy 1.5 times as much in avoided
    overtime pay expenses.
        Any talk of child care or elder care in relation to this
    bill is just a mirage. This bill does not address the cost of
    dependent care and has no mechanism to bring that cost down.
    Better Solutions
        If the Majority is serious about tackling child and elder
    care costs for working families, better solutions are
    available. The Majority could start by looking at existing law,
    which already sets up modest incentives for child and dependent
    care. Employers who provide child care services directly can
    deduct fringe benefits as an ordinary cost of doing business,
    and there are additional tax preferences for these child and
    dependent care benefits.\30\ Simply expanding these tax code
    incentives could make a meaningful difference without
    encouraging overwork.
    ---------------------------------------------------------------------------
        \30\Internal Rev. Svc., Pub. 503, Child And Dependent Care Expenses
    (2024), https://www.irs.gov/publications/p503; Linda Smith et al.,
    Bipartisan Pol. Ctr., The Employer-Provided Child Tax Credit (45F)
    (Nov. 2022), https://bipartisanpolicy.org/download/?file=/wp-content/
    uploads/2022/11/WEB_BPC_ECI-45F-Explainer_R01.pdf; Gov't Accountability
    Off., GAO-22-105264, Employer-Provided Child Care Credit: Estimated
    Claims and Factors Limiting Wider Use (Feb. 2022), https://www.gao.gov/
    assets/gao-22-105264.pdf.
    ---------------------------------------------------------------------------
        But there is clearly a need to do more. The Child Care for
    Working Families Act, slated to be reintroduced again this
    Congress, would ensure families across America can find and
    afford the child care they need, dramatically expand access to
    high-quality preschool programs, and boost wages for early
    childhood workers.\31\ Under the legislation, which Ranking
    Member Scott and Sen. Patty Murray (D-WA) have introduced every
    Congress since 2017, the typical family in America will pay no
    more than $10 a day for child care--with many families paying
    nothing at all--and no eligible family will pay more than 7% of
    the family's income on child care.
    ---------------------------------------------------------------------------
        \31\See, e.g., H.R. 2976, 118th Cong. (2023).
    ---------------------------------------------------------------------------
    Republican Attacks on Working Families
        Although likely to be sold as demonstrating the softer side
    of the Republican Majority, this bill is a fig leaf barely
    covering the Republicans' naked assault on working families.
        Head Start and other early child education programs on
    which many working families rely are under attack. On April 1,
    2025, five of 12 regional offices for the Office of Head Start,
    within the Department of Health and Human Services (HHS), were
    abruptly closed.\32\ The offices play a critical role,
    assisting grantees with grant management, compliance with
    health and safety regulations, and fiscal planning.\33\ In the
    wake of the abrupt office closures, with grantees left
    wondering whom to contact regarding grant renewals, the
    National Head Start Association voiced its ``deep[] concern[]
    about the potential disruption to vital services for eligible
    children and families across the country.''\34\
    ---------------------------------------------------------------------------
        \32\Moriah Balingit, Mass Layoffs Rattle Head Start Leaders Already
    on Edge Over Funding Problems, AP (Apr. 2, 2025), https://apnews.com/
    article/head-start-office-closures-hhs-trump-
    00b1a6b33ef918cb66e59b7ffb07ac1.
        \33\NHSA Expresses Deep Concern Over Administration Shuttering
    Regional Offices, Nat'l Head Start Assoc'n (Apr. 1, 2025), https://
    nhsa.org/press_release/nhsa-expresses-deep-concern-over-administration-
    shuttering-regional-offices/.
        \34\Id.
    ---------------------------------------------------------------------------
        This comes after mass layoffs at the Administration for
    Children and Families (ACF), also within HHS, which have
    reduced staff by as much as 38 percent in recent weeks.\35\
    ACF's Office of Child Care administers the Child Care
    Development Fund (CCDF), which provided child care subsidies
    for 1.8 million children in fiscal year 2021 (the most recent
    year for which data is available).\36\ CCDF subsidies play a
    crucial role in defining health and safety requirements for
    child care providers across states, ensuring parents have
    transparent information about the child care choices available
    to them, and helping eligible families make ends meet.\37\
    Attacks on CCDF and the ability of Head Start to administer
    services constrain already limited capacity for oversight and
    risk leaving children less safe and affordable child care out
    of reach for families in need.
    ---------------------------------------------------------------------------
        \35\Jonathan Cohn, Trump's Next Target: Poverty-Stricken Kids, The
    Bulwark (Apr. 6, 2025), https://www.thebulwark.com/p/trump-next-target-
    poverty-stricken-kids-hhs-head-start-early-childhood-child-care-
    education-programs-federal-cuts.
        \36\Id.; Nina Chen, Off. of the Assistant Sec'y for Plan. &
    Evaluation, Off. of Hum. Servs. Pol'y, Estimates of Child Care Subsidy
    Eligibility & Receipt for Fiscal Year 2021 (Sep. 11, 2024), https://
    aspe.hhs.gov/reports/child-care-eligibility-fy2021.
        \37\Office of Child Care, Admin. for Children & Fams. (Mar. 7,
    2024), https://acf.gov/office-child-care.
    ---------------------------------------------------------------------------
        The layoffs presage complete elimination of these programs.
    The news media recently published a leaked document that
    appears to be the Office of Management and Budget's
    ``passback'' instructions to the Department for Health and
    Human Services as it prepares its components of the President's
    annual budget submission.\38\ In it, Head Start is proposed to
    be completely eliminated, along with many other valuable
    programs supporting working families.
    ---------------------------------------------------------------------------
        \38\See Jeremy Faust, Scoop: Leaked PDF Outlines Major HHS
    Restructuring Proposal (Authenticity Now Confirmed). ``The Safety Nets
    Are Being Blown Up Right and Left.'', Inside Med. (Apr. 16, 2025),
    https://insidemedicine.substack.com/p/scoop-leaked-pdf-outlines-major-
    hhs.
    ---------------------------------------------------------------------------
        Medicaid also has a target on its back. The budget
    resolution passed by both the House and the Senate--supported
    by nearly the entire House Republican Conference\39\--directs
    the House Energy and Commerce Committee to cut $880 billion
    over ten years, which is expected to primarily come from cuts
    to Medicaid.\40\ Medicaid is a vital source of health coverage
    in the United States--including for workers--covering 1 in 5
    people and 41 percent of births nationally.\41\ Medicaid cuts
    will negatively impact people across the country, with
    disproportionate impacts for poorer states as well as
    individuals in rural areas and Black, Latino, and Indigenous
    people.\42\ Moreover, Medicaid is the largest payer for long-
    term care services for seniors.\43\ At the same time that
    Republicans are purporting to care about access to elder care,
    they are threatening the very program that pays for this care,
    only to extend tax cuts for the top 1 percent.\44\
    ---------------------------------------------------------------------------
        \39\H. Con. Res. 14, 119th Cong. (2025).
        \40\Sharon Parrott, House Republican Budget Would Mean Higher
    Costs, Less Help for Families, More Tax Windfalls for Wealthy, Ctr. on
    Budget & Pol'y Priorities, at 2 (Feb. 12, 2025), https://www.cbpp.org/
    sites/default/files/2-12-25bud-stmt.pdf.
        \41\Alice Burns et al., 10 Things to Know About Medicaid, KFF (Feb.
    18, 2025), https://www.kff.org/medicaid/issue-brief/10-things-to-know-
    about-medicaid/.
        \42\See Parrott, supra note 40.
        \43\See Burns, supra note 41.
        \44\See Parrott, supra note 40.
    ---------------------------------------------------------------------------

                                   CONCLUSION

        For the reasons stated above, Committee Democrats
    unanimously opposed H.R. 2270 when the Committee on Education
    and Workforce considered it on April 9, 2025. We urge the House
    of Representatives to do the same.

                                       Robert C. ``Bobby'' Scott,
                                               Ranking Member.
                                       Joe Courtney,
                                       Suzanne Bonamici,
                                       Mark Takano,
                                       Mark DeSaulnier,
                                       Summer Lee,
                                       John Mannion,
                                       Yassamin Ansari,
                                               Members of Congress.

                                      [all]