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Salaried workers to go on the clock when rules change Dec. 1
Overtime requirement has small businesses sweating effect
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Gainesville and Hall County salaried workers are some out of more than 4 million Americans who soon will qualify for overtime pay under a new set of rules.

Georgia accounts for 157,605 workers, or 3.7 percent of the national workers affected according to the Department of Labor’s White House fact sheet.

When the changes go into effect Dec. 1, any workers who make less than $47,500 annually can’t be denied overtime pay if they work more than 40 hours a week.

This means one of three things for business owners: Either they raise everyone’s wages to the new threshold; pay their workers time-and-a-half for every hour over 40; or cut their hours to only 40 a week.

Workers in the retail industry may be especially affected.

From an employee’s point of view, the grass looks greener on the other side.

“My boyfriend works on call and works over 40 hours almost every week,” said a woman who works at one of the stores on the downtown Gainesville square who asked not to be identified for fear of reprisal.

She immediately called her boyfriend to tell him about the new law. Because he works as an embalmer for a funeral home and is the only certified person to do his job, his guess is his employer will start paying him for the extra hours he works.

“That’s going to be crazy when it goes into effect,” the woman said. “We don’t need to lose more small businesses, but I think we will.”

Another woman, who also preferred not to be identified, could see both sides of the story, both from an employee’s perspective and someone who has owned a small business.

“I think salaried people are kind of taken advantage of,” the woman said.

She specifically said some businesses would be especially hurt, such as crisis hotlines and nonprofits.

“Crises don’t just happen on a 9 to 5 basis,” she said.

Workers like her account for 55.6 percent of the affected pool, according to the Department of Labor’s White House fact sheet.

“It is just going to be so scary for some workers and some small businesses,” she said.

She also didn’t agree with the date the changes are going into effect, since it’s in the middle of the fiscal year.

“That was so dumb to change it to that day,” she said.

A man who works as the chief operating officer of a store downtown admires the intent of the new plan but doesn’t like the practicality.

“I haven’t seen any positive on the practicality,” he said.

For his hourly employees, it means far less time on the clock. With holiday season coming up, it may mean changes for his company as well.

“I can’t afford to pay them time and a half,” he said. “We’re not going to be able to go around it. I don’t know how it’s going to work.”

Hourly workers will still have mostly guaranteed overtime if they work 40 hours, but some who make minimum wage won’t ever see the pay.

Georgia Department of Labor statistics report the average weekly income in Hall County equates to $48,308 annually, which is above the new overtime threshold.

“This in essence is a minimum wage increase for the middle class,” said Judy Conti, federal advocacy coordinator for the National Employment Law Project, an advocacy group.

The rule change will raise pay by $1.2 billion a year over the next decade, the White House estimates.

But some companies may choose to reduce their employees’ hours to avoid paying the extra wages instead

The changes could increase paperwork and scheduling conflicts for small businesses. It may even force some to convert salaried workers to hourly ones. Doing so would help them more closely track working time.

“With the stroke of a pen, the Labor Department is demoting millions of workers,” said David French, a senior vice president for the National Retail Federation. “Most of the people impacted by this change will not see any additional pay.”

The overtime threshold was last updated in 2004 and now covers just 7 percent of full-time, salaried workers, administration officials said. That’s down from 62 percent in 1975.

The higher threshold will lift that ratio back to 35 percent, Labor Secretary Tom Perez said. He has spearheaded the administration’s effort and worked on formulating the rule for the past two years.

The new rule is intended to boost earnings for middle- and lower-income workers, Perez said, which have been stagnant since the late 1990s.

Overtime pay hasn’t gotten as much attention as nationwide efforts to increase the minimum wage, but it could have a broad impact.

The Associated Press contributed to this report.