The Obama Administration has done some rule-making with the Department of Labor that could dramatically change pay scales for many workers. The changes are expected to go into effect by the end of the year, although there is not a specific date yet. What’s at stake is how employees are classified for compensation purposes. The rule-making would raise the salary threshold dramatically, making millions more employees eligible for overtime compensation. Currently, employees who earn up to $23,660 annually must be paid hourly. Some of those who earn more than $23,660 could be classified as exempt, and not eligible for overtime pay. With the new rule, that threshold would be increased to $50,440. Employees earning less than that amount would now be non-exempt and would be paid hourly. Employers would face difficult decisions on which employees may need to cut their hours to stay within budget. Many exempt employees today work more than forty hours per week, but the budget each year is set and based on the known salaries, not on how much an employee could make if he/she was paid hourly for the hours worked beyond the traditional forty each week. The U. S. Chamber of Commerce is leading the charge in Washington, DC to oppose this new rule, but with no luck so far. Think about your own company and what you pay your employees. How would you fare if this rule goes into effect? Beyond the pay issues already described, will there be impacts on employee benefits and flexibility in work hours? The Prescott Chamber will continue to monitor this plan and keep our members informed. We are discussing the possibility of a seminar or workshop for our members in conjunction with the Prescott Valley Chamber of Commerce. Watch for further details soon.
May 17 could be a critical turning point on the future of K-12 education in Arizona. On that day, voters will be given the opportunity to support an education financing package that would put $3.5 billion into Arizona schools over the next ten years, without raising taxes. It is truly a win-win proposal. The Prescott Chamber is proud to partner with other chambers, business groups, the Governor and several others that crafted this funding program. The increased funding will come from an increased payout from the State Land Trust which historically provides an annual payout of 2.5% of the permanent funds in the Trust. The new payout amount would increase to 6.9% for ten years. The Prescott Unified School District would receive more than $700,000 annually if this proposition is passed. PUSD would have control of the funds and how they would be used. Proposition 123 would also settle an ongoing lawsuit between public schools and the state legislature regarding K-12 funding. It’s been said before—today’s students are tomorrow’s employees and business owners. Investing in the future is a good thing and Prop. 123 deserves your support.