Wicker: Controversial Labor Rules Are Poised to Have a Big Impact

Statement

A big-government agenda has always been the Obama Administration's approach. This intrusiveness has affected Americans' lives in very personal ways, from choosing a health-care provider to irrigating private property. Now the U.S. Department of Labor is further expanding the Administration's overreach with two controversial new rules that could have a major impact on Americans' careers and retirement planning.

Compliance Would Cost Miss. Universities Millions

One of the rules extends overtime pay requirements to entry-level salaried workers -- a regulatory burden that could severely impact the budgets of small businesses, nonprofits, and municipalities. The additional labor costs might force these organizations to provide fewer services or raise prices. Young people with their first full-time job could be reclassified as hourly workers, limiting opportunities for promotions. Some economic analysts doubt that employees will actually see their take-home pay increase.

The red tape comes with a hefty price tag. Municipalities from Saltillo to Gulfport expect to be affected. The University of Mississippi, Mississippi State University, the University of Southern Mississippi, and Jackson State University have all warned that the overtime rule, which goes into effect later this year, will cost millions of dollars. These added expenses could be passed on to students in the form of increased tuition.

A rule forcing overtime pay will not change the fact that wages have remained stagnant during the Obama Administration, rising by an average of only 0.4 percent per year. A better way to boost wages for everyone is to advance economic policies that not only empower job creators but also promote sustainable work, allowing Americans to pursue meaningful, fulfilling careers.

Senate Votes to Block Rule on Retirement Advice

The Senate plans to take action as early as next week against the overtime rule by introducing legislation that would invoke the "Congressional Review Act," which allows Congress to pass a resolution overriding executive regulation. Last month, the Senate was successful in passing a similar resolution to block the Department of Labor's fiduciary rule specifying who can give investment advice within private-sector pension plans.

The fiduciary rule, which would take effect next spring, is yet another example of federal intrusiveness into Americans' daily decision-making -- in this case, how to plan for retirement. Specifically, the rule incentivizes financial advisors to switch from a commission-based model to a fee-based system. The fees, however, could make it too costly for low- and middle-income Americans to seek personal financial advice. They could be forced to leave a financial advisor that they or their family have worked with for years.

All Americans, regardless of the size of their retirement savings, deserve access to quality financial advice. The fiduciary rule threatens to restrict this access for as many as 19 million Americans that use IRAs. It also risks affecting small business retirement plans that represent more than nine million U.S. households. Like the President's promise that Americans could keep their health-care plan, the promise of keeping the same financial advisor wears thin under the new rule.

I supported the resolution to block the Administration's fiduciary rule, and I remain opposed to labor rules that put a strain on our educational institutions, nonprofits, and municipalities. These cumbersome rules and regulations encroach on the pathways to career success and personal liberties that could truly make a difference in Americans' lives.

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