AHLA: DOL overtime rule will hurt hotels and limit employee opportunities

WASHINGTON (April 23, 2024) – American Hotel & Lodging Association (AHLA) Interim President & CEO Kevin Carey issued the following statement today after the Department of Labor (DOL) released its final overtime rule to raise the minimum salary threshold under which all employees must be paid overtime for any hours worked over 40 in a week.

“This rule is part of a growing list of aggressive federal regulatory efforts that are making it even harder for hoteliers to operate their businesses in this challenging environment. The impacts of this regulation will risk the elimination of jobs and make it more difficult for employees to pursue the existing pathways to success and career growth that the industry offers,” said AHLA Interim President & CEO Kevin Carey. “We fear many hoteliers will have no option other than to eliminate managerial jobs that are long-established paths to advancement. AHLA is reviewing all available options, including litigation, for defeating this ill-advised regulation.”

Background

DOL’s overtime rule would increase the salary threshold for employees to qualify as salaried executive, administrative, and professional employees who are exempt from overtime pay requirements under the Fair Labor Standards Act.

The rule is part of a wave of recent federal efforts making it harder for hoteliers to do business that also includes regulations to determine joint-employment and workers’ independent-contractor status.

Under the new overtime rule, the salary threshold will be increased from the current $35,568 to $43,888 on July 1, 2024, and then to $58,656 on January 1, 2025. The first increase is based on the department’s current methodology for setting the threshold, while the second increase uses the department’s new methodology of setting the threshold to the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census region.

This rule comes after DOL increased the minimum salary threshold by more than 50% to $35,568 just four years ago.

AHLA is leading coalition efforts with the Partnership to Protect Workplace Opportunity, a business coalition that opposes the DOL rule, and in March AHLA led an industry letter to Congress in support of legislation that would overturn the rule.

About AHLA

The American Hotel & Lodging Association (AHLA) is the largest hotel association in America, representing more than 30,000 members from all segments of the industry nationwide – including iconic global brands, 80% of all franchised hotels, and the 16 largest hotel companies in the U.S. Headquartered in Washington, D.C., AHLA focuses on strategic advocacy, communications support, and workforce development programs to move the industry forward. Learn more at www.ahla.com.

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