ARLINGTON, Va.--(BUSINESS WIRE)--The following statement is attributed to Gary Shapiro, president and CEO, Consumer Electronics Association (CEA)®, regarding today's House Small Business Subcommittee on Investigations, Oversight and Regulation hearing on "The Consequences of DOL's One-Size-Fits-All Overtime Rule for Small Business and their Employees:"
"We praise the Committee for holding a hearing on the Department of Labor's (DOL) proposal to impair the current exemption for executive, administrative, professional, outside sales and computer employees from the overtime requirements under the Fair Labor Standards Act. DOL is proposing an unprecedented 113 percent increase in the minimum salary to qualify as an exempt employee, from $455 per week ($23,660 per year) to $970 per week ($50,440 per year) next year. This radical change in the law would severely damage American startup companies and hurt innovation.
"The proposal will make it more difficult and expensive for Americans to start companies, hire employees and create competitive products and service markets where we face global competition. The new rule will plunder the unique U.S. competitive advantage of a flexible workforce that delivers innovative products to market quicker than our global competitors. It will deny many new graduates the opportunity to obtain their first full-time job. Clearly the economic impact has not been adequately thought through. Congress should strongly urge the DOL to reconsider this damaging proposal."
What Startups Are Saying
- "What startups can't offer in salary, they offer in leadership opportunities by creating an environment that rewards personal responsibility, drive, dedication and resilience," said Jake Sigal, CEO, Tome Software, a Detroit-based startup launched in 2014. "We should encourage companies to immerse young workers in environments of high productivity and resilient work, not punish them. The first years of a company are very hard and most startups fail. This proposal would accelerate the failure rate, by limiting startups' access to talent and capacity to grow."
- "This proposal will reduce the number of employees a startup can afford to hire, slowing down its growth and putting the company at risk of never turning the corner," said Ximena Hartsock, co-founder and president, Phone2Action, a digital, grassroots platform based in Washington, DC. "Ironically, while the intent of this proposal is to boost jobs, in reality what it will do is reduce the capacity of small companies to create new jobs."
- "Many startup companies include an equity component in their offers, as they're unable to pay higher salaries," said Justin Baros, head of talent, ChatID. "In addition, many early stage employees proactively request to take a lower salary in exchange for a more significant ownership stake in their company."
The Consumer Electronics Association (CEA) is the technology trade association representing the $285 billion U.S. consumer electronics industry. More than 2,000 companies enjoy the benefits of CEA membership, including legislative and regulatory advocacy, market research, technical training and education, industry promotion, standards development and the fostering of business and strategic relationships. CEA also owns and produces CES – The Global Stage for Innovation. All profits from CES are reinvested into CEA’s industry services. Find CEA online at CE.org, InnovationMovement.com and on social.
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