Contending that “hard work should be recognized and rewarded,” Michigan Gov. Gretchen Whitmer took action Thursday in a bid to assure that a substantially larger pool of Michigan workers will earn overtime pay than ever before.
Whitmer has directed the Department of Labor and Economic Opportunity to submit a request for rulemaking to expand the right to overtime pay to more Michigan workers. Changes in federal law are set to extend overtime pay rights to workers making up to $35,500, but even then less than one in six Michiganders will benefit, down from a peak of more than 60-percent of workers.
Saying, “In America, hard work should be recognized and rewarded,” Whitmer adds, “When I was growing up, that meant you got overtime if you worked more than 40 hours.” She went on to say, “President Obama took the first step towards restoring this right for millions of Americans five years ago, and if his proposed rule had taken effect, workers earning up to $51,000 today would be eligible for overtime pay. Instead, President Trump took a big step backwards when he implemented a rule that leaves 200,000 Michigan workers behind. That’s why today I’m directing the Department of Labor and Economic Opportunity to take action that will extend the right to overtime pay for thousands of Michigan workers. Strengthening paychecks is good for families, good for business, and good for our economy. It’s time to get it done.”
According to the United Way’s ALICE report on financially struggling households, families need an annual salary of $61,000 just to afford the basics and support a family of four. Families that live below the ALICE threshold struggle to pay for health care, childcare, car insurance, and healthy food for their children.
Jeff Donofrio is Director of the Michigan Department of Labor & Economic Opportunity. He says, “Governor Whitmer’s directive to increase overtime pay protections is good for workers and good for Michigan’s economy. This directive begins the rulemaking process, which will include feedback from businesses and key stakeholders, and we look forward to their participation as we move forward.”
Whitmer contends that increasing overtime pay protections is good for Michigan workers and businesses across the state.
Not everyone agrees, especially those in the business community. The NFIB argues strongly against the move, and you can see State Director Charlie Owens comments below.
In 2014, the Obama Administration sought to increase the overtime threshold to $47,476. Rather than supporting the original proposal, the Trump Administration abandoned the historic expansion and finalized their own level of just $35,568, which will leave nearly 200,000 Michiganders without access to overtime pay.
As a result, more and more states are expanding the right to overtime pay. California is raising its threshold to $62,400 by 2022. New York is raising its to $58,500 by dates between 2019 and the mid-2020’s varying by region. Washington State and Pennsylvania are finalizing agency rules to raise it to $79,872 by 2026, and $45,500 by 2022, respectively. Massachusetts has proposed raising it to $64,000 by 2022, and Maine to $55,000 by 2022.
Once the request for rulemaking is submitted, the process to finalize an overtime rule could take between 6 to 12 months.
To view the full request for rulemaking, click the link below:
Request-for-Rulemaking-2018-PA-337
Response was swift on multiple fronts:
- Heidi Shierholz, former Chief Economist at the U.S. Department of Labor says, “This morning Governor Whitmer announced a proposal to update Michigan’s overtime regulations. The Governor is stepping up for the hard-working people of Michigan and I applaud this move, particularly given that the Trump administration recently published a weak overtime rule that would leave almost 200,000 Michigan workers behind. The Governor’s proposal embodies the idea of a fair day’s pay for a long day’s work is the right move for Michigan families and the Michigan economy.”
- M. Patricia Smith, former U.S. Solicitor of Labor, United States Department of Labor and Senior Counsel, National Employment Law Project adds, “The National Employment Law Project applauds Governor Whitmer’s announcement that Michigan will raise its overtime threshold to protect the state’s middle class workers. Overtime pay has been eroding for decades allowing thousands of Michigan workers to be made to work long hours with no extra pay for their hard work and dedication. Michigan is joining the growing number of states that are stepping in to protect overtime pay now that the Trump Administration has rolled back stronger federal overtime protections leaving millions of U.S. workers behind. By moving to restore overtime protections Governor Whitmer can help restore the forty hour work week – and ensure when Michigan workers have to put in extra hours, they’re paid fairly.”
- Senator Jim Ananich, Senate District 27 notes, “Salaried workers who put in more than 40 hours per week at their jobs deserve a long-overdue raise. These are the folks that keep our businesses and offices running, and without guaranteed overtime pay, their hard work after hours comes at a great personal cost. Increasing the overtime threshold ensures employees are compensated fairly for their work, and I am glad to see Governor Whitmer leading the way to get this done.”
- Michigan NFIB Director Charlie Owens rides the opposite side of the fence saying, “We are disappointed that the governor has chosen to go around the Michigan legislature to try to impose a new wage mandate on small and family owned businesses through the rules process. If her efforts are successful, Michigan will be an outlier among other states because we will have an overtime rule that is more excessive than what the federal government has established. Her proposal would force thousands of small businesses to increase their costs and ultimately force small business owners to lay off employees. Unfortunately, the governor and her Democrat allies in the legislature seem intent on pursuing the same policies that were responsible for Michigan’s lost decade of economic malaise during the Granholm years. This will undo the hard work of the last eight years to pull Michigan out of the ditch and create a state with a small business friendly labor climate that is responsible for record employment and rising personal incomes.”
Stay tuned.
