Dive Brief:
- The U.S. House Representative passed the Regulatory Relief for Small Businesses, Schools and Nonprofits Act Thursday, which delays implementation of the Department of Labor's new overtime rule by at least six months, according to Politico.
- Construction groups including the Associated Builders and Contractors hailed the move against the DOL regulation, which was scheduled to take effect Dec. 1. President Barack Obama has threatened to veto any legislation that delays the new rule.
- The new rule, released in May, raises the exempt threshold for salaried workers from $23,660 to $47,476 per year.
Dive Insight:
The ABC, along with the National Association of Home Builders and other business groups, filed a lawsuit against the DOL earlier this month to stop the implementation of the overtime rule. Both the industry's action and an additional suit brought by 21 states both argued that the agency does not have the right to raise the minimum salary for exempted employees, as the rule dictates. Brian Turmail of the Associated General Contractors of America told Construction Dive in May that the threshold increase is unreasonable and that the rule would force employers to devote more resources to compliance, not result in higher wages.
When the rule was first announced in May, NAHB Chairman Ed Brady called the DOL action "sheer arrogance" in deciding to double the overtime salary cap. He said the move would force companies to put salaried employees on an hourly wage and that the mandated pay schedule did not consider the fact that different regions of the country have varied pay scales. Many industry groups have also argued that the rule would result in reduced hours and benefits in order to counteract the increase in pay.
This is just one of several rules that the construction industry has pushed back against, including OSHA's revised silica standard, the Davis-Bacon Act, as well as more regulatory action at local and state levels. The NAHB estimated that increased governmental requirements have added almost 25% to the cost of a new home. Industry groups have argued that these rules are impediments to new construction, which is especially critical in an environment of pervasive low inventory in many areas of the country.