Next week’s Business Week has an article about the state of overtime laws in the U.S. From the first graf:
Do America’s decades-old overtime laws make sense anymore? Despite the litigation they are generating, there’s almost no political momentum to change them.
If the author means there’s no political momentum to repeal overtime laws, he’s probably correct, but wise old codgers like me remember in the deep dark past the great overtime regulation revolution of 2004. Those changes required a fair amount of political capital, too.
The crux of the argument is that overtime laws are not achieving their original policy aim:
Yet it’s generally accepted that overtime laws don’t achieve one of their main New Deal-era goals: increasing employment. The initial idea was that companies would choose to hire extra workers rather than pay existing ones time and a half. But that calculus doesn’t hold these days, given the enormous fixed costs of such things as benefits and training for each additional employee.
That may be true, but the original 70 year old policy aim, I submit, is irrelevant. In politics, anything you’ve given to some group that’s advantageous to them, they want to keep. Telling someone they don’t need their extra pay because it’s not creating more workers isn’t going to fly. That’s the politics of it. Policy-wise, there has to be negative implications to that kind of change to wages.
This article started out suggesting that overtime litigation was the concern–is there no common ground between business and labor on that aspect? If not, I suspect the sides are much, much closer than they would be on eliminating overtime.
What’s the solution?
