1. End of Summer Brings New Regulations for Manufacturers
With summer coming to a close, the manufacturing industry is gearing up to deal with two new
regulations from the federal government that have the potential to seriously disrupt the industry.
The United States Department of Labor issued a proposal that would increase the salary
threshold for mandatory overtime. Current regulations require employers to pay overtime to all
hourly workers and salary workers who make less than $23,660. The new regulations would
more than double the salary threshold to $50,440. This increase could have drastic effects on the
manufacturing industry, especially small businesses. The regulation will result in many salary
workers being reclassified as hourly in order to offset costs. Salary workers enjoy the benefit of
working flexible hours, but if reclassified restrictions could be put in place as well as workers
seeing their hours cut.
One Voice, a partnership between the Precision Metalforming Association (PMA) and the
National Tooling and Machining Association (NTMA) filled comments to the Department of
Labor on September 4th regarding the DOL’s proposal. One Voice described the new regulations
as a “disincentive” for manufactures saying, “Employers will either hire more part-time
employees, outsource those functions, or increase their automations – all resulting in fewer
manufacturing jobs in the U.S.”
Another regulation, this time from the U.S. Environmental Protection Agency, is threatening the
manufacturing industry. By Oct. 1 the EPA is expected to soon roll out new regulations that
would require deductions in ground-level ozone.
The rules would limit emissions to between 65 and 70 parts per billion. The agency said they are
open to hearing comments on lowering the limit to 60 ppm. The EPA argues that the costs to
businesses will be offset by the money people will save from lower healthcare costs.
According to a study paid for by the National Association of Manufacturers (NAM), stricter
ozone regulations “could be the costliest in U.S. history.” The study suggests that the cost to
businesses could exceed over $1 trillion between 2017 and 2040. This means billions of dollars
in compliance costs and the loss of thousands of jobs per year. The manufacturing industry also
faces the question of how they will be able to abide by such drastic reductions which are
currently implausible with current technology.
Republican Gov. Scott Walker expressed his objections to the EPA in a letter saying the “costly
mandates” have “little regard to their cost, impact on the economy or even how the standard will
be achieved.”
NTMA’s team in Washington will continue their advocacy efforts for small and medium sized
manufacturers in the media and with policymakers as these regulations come into effect.