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BPAA Biweekly Federal Policy Updates - March 8

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  • Bloomberg Government reports - Labor Department Unveils New Overtime Pay Requirements: The Labor Department March 7 unveiled a long-awaited proposal to make more workers eligible for overtime pay. Workers who make less than about $35,000 per year would be automatically eligible for time-and-a-half pay for all hours worked beyond 40 a week, under the Trump administration’s proposal. That’s up from the current threshold of $24,000, but not as high as the $47,000 mark proposed by the Obama administration in a stalled regulation.
    • The proposal doesn’t establish automatic, periodic increases of the salary threshold as the Obama proposal had. Instead, the department is asking the public to weigh in on whether and how the DOL might update overtime requirements every four years. The proposed rule also doesn’t tinker with the current “duties test,” a checklist used to determine whether workers making more than the salary threshold are supervisors, not entitled to overtime wages.

The salary threshold was last increased in 2004, during the George W. Bush administration. The DOL is using the same economic methodology used to reach that standard, which the department officials say should protect the proposal from litigation.

  • But the proposal is still likely to be a target of legal challenges from business groups concerned about rising payroll costs and worker advocates who say the department isn’t going far enough to expand overtime pay. The Obama proposal, blocked by a judge in a 2017 decision that’s still on appeal, was expected to make some 4 million workers newly eligible for overtime. The Trump administration says 1 million workers will be newly eligible under the proposed rule.
  • The overtime question has been watched closely by businesses in a wide range of industries. CBS Television Studios recently agreed to pay nearly $10 million to settle a class action for unpaid overtime. Bank of America Corp.Chipotle, and T-Mobile US Inc.are among other companies recently entangled in similar suits.
  • The department is seeking public comments on the rule. It’s in a race with the clock to review those comments within 60 days and publish a finalized version of the rule before the 2020 election, so that the regulation will be more difficult to scrap if a Democrat wins the White House. Read more about the proposed rule at Politico.
  • House $15 Minimum Wage Bill Moves to Floor Vote: The House Education and Labor committee March 6 advanced a bill to raise the federal minimum wage to $15 an hour for a full chamber vote. The panel approved the Raise the Wage Act (H.R. 582, S.150) along party lines. The bill, introduced by committee chairman Rep. Bobby Scott (D-Va.), would gradually raise the current $7.25-an-hour federal wage floor to $15 by 2024. It would also erase separate minimums for tipped and other workers. Democrats will need to drum up bipartisanship support for it clear the Republican-controlled Senate.
    • Republicans criticized the bill, saying it should be up to the states and companies to determine a wage floor. An across-the-board $15 wage would lead to job losses in parts of the nation, said the committee’s ranking member, Virginia Foxx (R-N.C.). “Going from a $7.25-an-hour federal minimum wage to a $15-an-hour minimum wage is, at best, a foolish policy proposal,” Foxx said. “At worst, it’s an intentionally dishonest political stunt that promises bigger paychecks to hardworking Americans when in reality it would result in significant job losses for millions of hourly workers around the country.”
    • Her comments were echoed by other Republicans like Rep. Rick Allen (Ga.) who said the matter shouldn’t be decided by Congress. “I believe that states, localities, and the business community are in the best position to work together to address wage issues within their state,” he said.
    • Some blue states are considering or have already passed laws to set a $15 hourly wage floor. California, Massachusetts, Illinois, New Jersey, and New York, as well as the District of Columbia, have passed $15 minimum wage legislation. States including Maryland and Pennsylvania are weighing efforts to raise the wage floor to that level. A total of 29 states and Washington, D.C., have minimum wages higher than the federal $7.25.
    • The bill rejected seven amendments proposed by the GOP minority. The amendments ranged from exempting small businesses with fewer than 10 employees to preventing state and local governments from enacting minimum wage increases that exempt union members. The bill heads to the House floor, where it will likely pass. But without provisions that would aid businesses and draw Republican support, the measure is unlikely to clear the Senate.
  • Press Release from the Committee on Education and Labor Republicans - A $15 an Hour Federal Minimum Wage: A Wolf in Sheep’s Clothing: Today, Committee Democrats held a markup on H.R. 582, the Raise the Wage Act. If enacted, this legislation to more than double the federal minimum wage to $15 an hour will result in millions of job losses for vulnerable Americans, small business closures, and significant losses to the U.S. economy.
    • During the markup, Republican Leader Virginia Foxx (R-NC) said: “H.R. 582 will hammer small businesses and mom and pop shops. It will push hundreds of thousands of able-bodied, talented individuals out of the workforce over the next decade. It will result in millions of jobs being eliminated for vulnerable members of the workforce like single working moms, workers without a high school diploma, and entry-level employees.”
    • During debate, Rep. Tim Walberg (R-MI) stated: “Republicans recognized that tax reform and regulatory relief would unleash historic economic growth, and it has. This legislation is a calculated move in the opposite direction of tangible, widespread economic progress for Americans in every community in this country. That’s why we should oppose it and get back to work that actually helps the people we represent.”
    • The consequences of raising the minimum wage to $15 an hour are not hypothetical. Hear Simone BarronHeidi Mann, and Joshua Chaisson share how a mandated $15 an hour minimum wage has directly disrupted their livelihoods.
  • Most U.S. economists (74 percent) don't support raising the hourly federal minimum wage to $15, according to a new online survey of 197 economists conducted by the right-leaning Employment Policies Institute. Some 77 percent said raising the minimum that high would eliminate jobs. But nearly half (46 percent) favored raising the minimum above its present level of $7.25. Read the study here.
  • National Restaurant Association comes out strongly against 'Raise the Wage Act': This week, the National Restaurant Association came out against H.R. 582, or the “Raise the Wage Act”, proposed legislation that would increase the federal minimum wage from the current $7.25 per hour to $15 per hour throughout the next five years.
    • According to the NRA, the bill would suppress new job creation in the restaurant industry — the second-largest private sector employer in the country. The organization also claims that mandating $15 an hour would impose undue harm on small business owners. Read more at Restaurant Dive.
  • Industry Pushes Back As Congress Eyes A $15 Minimum Wage: Although pundits say a proposal raising the federal minimum wage to $15 an hourhas a slim chance of getting through Congress, opponents are taking no chances, blasting the measure as a potential killer of jobs and small businesses such as restaurants. Still, their efforts have failed to derail the initiative, which was voted out of committee yesterday. The bill will be put  to a floor vote in the House of Representatives in the next few weeks.  It is expected to win passage there and then be defeated in the Senate. Read more at Restaurant Business.


  • ASCAP, BMI Propose Interim, Time-Limited Consent Decrees to DOJ: As the Justice Department ponders when, how and whether to lift consent decrees on how the major music licensing organizations can collect fees from broadcasters, cable operators and others, the aforementioned organizations have laid out a suggested road map for revision. Actually it is a plan for new, transitional, decrees on the way to eliminating them entirely. The decrees affect how those organizations collect fees from programmers and distributors for music in their content. In a letter to Justice, the heads of ASCAP and BMI jointly outlined the recommendation, which is essentially for an orderly transition to no decrees. "We believe that a free market with less government regulation is hands down the best way for music creators to be rewarded for their hard work and intellectual property," they said about that ultimate goal:
    • "[W]e’re recommending the DOJ replace the current BMI and ASCAP consent decrees with newly formed decrees that would protect all parties," wrote ASCAP CEO Elizabeth Matthews and BMI CEO Mike O’Neill. "Like all modern consent decrees, they would also include a sunset provision. Those new decrees would contain four key provisions:
      • "First, allow all music users to still gain automatic access to the BMI and ASCAP repertoires with the immediate right to public performance. However, this right should be contingent upon a fairer, more efficient, less costly and automatic mechanism for the payment of interim fees.
      • "Second, retain the rate court process for resolution of rate disputes, as recently reformed by the Orrin G. Hatch-Bob Goodlatte Music Modernization Act (MMA).
      • "Third, BMI and ASCAP will continue to receive non-exclusive U.S. rights from our writers and publishers, which allows licensees, songwriters, composers and publishers to still do direct deals if they so choose.
      • "Fourth, preserve the current forms of licenses that the industry has grown accustomed to beyond the traditional blanket license, such as the adjustable fee blanket license and the per- program license."
    • Read the full article here at Broadcasting Cable.


  • Tax Reform Unleashed The U.S. Economy: For a midterm report card on the economy under President Trump, take a look at two recent government reports. The Commerce Department reported Thursday that real gross domestic product grew by 3.1% from the fourth quarter of 2017 to the fourth quarter of 2018—the largest rise in 13 years. And last month the Congressional Budget Office reported that even if the current surge in economic growth isn’t sustained, the revenue residual from our current strong growth rate will pay for some 80% of the projected cost of the 2017 tax reform. While these reports reflect only the initial impact of the tax cuts and the deregulatory effort, any objective evaluation would give the administration’s economic program high midterm marks. Read more at The Wall Street Journal
  • What's Next For The State And Local Tax Deduction?: Tax reform became a reality at the end of 2017, but taxpayers are only now starting to see the impact as they prepare their 2018 tax returns. A host of new provisions will affect the taxes that Americans pay this tax season, including new lower tax rates, a higher standard deduction, and significant changes to many deductions and credits. One of the most hotly debated provisions of tax reform was the new limitation on itemized deductions for state and local taxes, often abbreviated as SALT. The new limit was especially painful in some key states, and that made many opponents argue toward restoring the deduction. Read more at The Motley Fool.
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