WASHINGTON (4/12/16)--A set of bills in both chambers of Congress requiring further analysis of the U.S Department of Labor’s (DOL) overtime rule have the full support of the Credit Union National Association (CUNA).
The Protecting Workplace Advancement and Opportunity Act (S. 2707/H.R. 4773) would require DOL to fully analyze the impact of its proposal to increase the threshold of overtime pay eligibility, which CUNA believes will have unintended negative consequences for credit unions, particularly smaller credit unions and those in non-metropolitan areas.
The DOL proposed changes to overtime pay in 2015, changes that would increase the threshold of overtime pay eligibility by more than twice the current rate. CUNA, in its comment letter filed in September 2015, said the proposal would make it extremely difficult for credit unions to comply with the rule.
CUNA President/CEO Jim Nussle outlined CUNA’s concerns in letters to Sens. Lamar Alexander (R-Tenn.) and Tim Scott (R-S.C.), who introduced S. 2707, as well as Reps. John Kline (R-Minn.) and Tim Walberg (R-Mich.), who introduced H.R. 4773.
“The department's rule as proposed will magnify the regulatory burdens and constraints credit unions already face, particularly since 35% of all credit unions have no employees making salaries over the DOL's proposed threshold,” the letters read. “Furthermore, the rule has the potential to negatively impact credit union members, particularly if the credit unions are forced to limit services as a result of changed employment situations or the inability to hire full-time employees.”
Roughly 35% of all U.S. credit unions do not have an employee who makes more than $50,000 per year. CUNA’s 2015-2016 Staff Salary Report shows that 46% of all credit union CEOs work at credit unions with $20 million or less in total assets.
Nussle added that further analysis of the DOL’s proposal is critical before the agency finalizes the rule, and the analysis required by the bills would be responsible for “providing the public with essential details that are missing from the proposed rule, as well as allowing additional public comment on these specific changes.”