From new minimum wage rulings to proposed overtime changes to the Affordable Care Act, President Obama has made significant changes in the way companies in this country can do business. According to Rob Wilson, employment expert and CEO of Employco USA, “Obamanomics” could spell disaster for many employers.
“It started with Obamacare,” explains Wilson. “Since many companies couldn’t afford to offer their staff health insurance, they slashed employees’ hours and made them part-time instead of full-time, thereby forcing Americans to cobble together multiple part-time jobs in order to make ends meet. Now, companies face another issue: Overtime.”
Currently, the Obama administration is proposing changes to overtime regulations, changes which would offer more employees the chance to earn this extra income. However, not everyone thinks this is such a good plan.
Wilson says, “Economists don’t think the proposed plan is tenable in the long-term. Overtime wages are projected to be $1.3 billion. The FICA taxes associated with the OT wages alone is roughly $200 million (employer and employee combined). Plus, many people fear that employers will simply dump employees rather than face the prospect of paying multiple people overtime. Others will decrease their employees’ salaries in order not to lose money as a result of all the overtime they will have to pay. It’s a lose-lose for everyone.”