April was a big month for making life better for Americans. The Biden-Harris administration announced new rules on over-time pay, non-compete clauses, nursing home staffing, and Net Neutrality.
The US Department of Labor (DOL) updated the Fair Labor Standards Act (FLSA)'s overtime pay requirements. The rule increases the minimum salary threshold for businesses to avoid paying over-time to salaried workers to $43,888 on July 1, 2024, and then to $58,656 on January 1, 2025. Then starting in 2027, the threshold will automatically increase every three years to reflect changes in average earnings. Salaried workers who earn above the salary threshold may still be eligible for overtime pay if they do not primarily perform management-related duties as long as they earn less than about $151,000. As you might expect from a Republican in the pocket of big business Rep. Virginia Foxx of North Carolina claimed; "If the administration's goal with this rule is to improve the standard of living for workers, then it's failing miserably." Unions and worker advocacy groups praised the Biden administration for restoring overtime protections that it said had been "gutted" by the Trump administration.
The Labor Department estimates that 4 million lower-paid salary workers who are exempt under current regulations will become eligible for overtime protections in the first year under the new rule. An additional 292,900 higher-compensated workers are also expected to get overtime entitlements. That’s a lot of Americans who will either be paid more or will have more time to spend with their families.
On April 23 the Federal Trade Commission (FTC) issued a final rule banning non-compete clauses nationwide. Non-compete agreements restrict employees who leave a job from working in that field for a specific time period in a certain geographic area. The commission voted to approve the final rule 3-2. If you guessed that the 3 Democratic appointees were the ones who voted yes while the 2 Republican appointees voted no give yourself a cigar. The FTC determined that non-compete clauses violate Section 5 of the FTC Act, which prohibits “unfair or deceptive acts or practices in or affecting commerce.” The final rule is set to become effective in late August. The only exceptions are for senior executives defined as workers earning more than $151,164 annually and who are in policy-making positions. Senior executives comprise less than 0.75% of all workers.
The FTC estimated 30 million Americans, roughly 20% of workers, are bound by non-compete agreements. This is an important ruling as “Non-compete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once non-competes are banned,” according to FTC Chair Lina M. Khan in a press release. “The FTC’s final rule to ban non-competes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”
Of course the day after the announcement, the U.S. Chamber of Commerce and several other business groups sued the FTC in Texas federal court in an attempt to block the rule. This is typical judge shopping where the lawyers suing look for a judge likely to take their side.
As you might expect if it is good for workers big business will push back and their Republican lap dogs will bark up a storm. Just don’t let anyone tell you that the Biden-Harris administration isn’t making things better for the average American. It’s the Trump cult Republicans who aren’t interested in making life better.
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