PORTLAND — A new law raising the salary level at which workers can claim overtime would directly affect at least 16,000 people in Maine, drawing praise from labor groups and criticism from the state’s retail association and others.

The U.S. Department of Labor reported the law would directly affect 16,000 workers in Maine and 4.2 million nationwide, as the rule means salaried workers making up to $913 per week can qualify for overtime, up from the current level of $455. The rule takes effect Dec. 1, unless Congress intervenes.

The left-leaning Economic Policy Institute in a broader analysis estimated that about 46,000 workers in Maine would be affected, either by qualifying for time-and-a-half pay for working over 40 hours in a week, having hours scaled back to 40 hours while making the same pay or getting a raise to put them above the $913-a-week threshold.

Cynthia Phinney, president of the Maine AFL-CIO, praised the rule change in a statement Tuesday, saying it “restores the basic principle that an honest day’s work deserves a fair day’s pay.”

“Maine workers are putting in longer hours and still not getting ahead,” Phinney said. “One big reason is that many workers have been suffering from unfair federal overtime rules that have fallen woefully out of date.”

Meanwhile, the Retail Association of Maine, the Lewiston-Auburn Metro Chamber of Commerce and the state human resources industry group criticized the proposal’s impact on the state and urge Congress to intervene to postpone or slow the rule, which would double the current salary threshold for qualifying for overtime.

“If Congress doesn’t act, it will be irreversible,” Curtis Picard, executive director of the Retail Association of Maine, said.

Picard said Congress could also change the rule after Dec. 1, but that it would be practically irreversible because employer changes to comply would be difficult to unwind. Picard said he is headed to Washington, D.C., next week to help lobby on the issue.

Picard said his group opposes the rule change because it does not factor in regional cost of living differences and, for that reason, could have a disproportionate impact in Maine.

Matt Leonard, president and CEO of the Lewiston-Auburn Metropolitan Chamber of Commerce, said Wednesday that his group opposes the rule partly for the anticipated impact on educational institutions in the area and his group’s 116 nonprofit members, who he said would spend more on overhead under the rule.

“While businesses in the Lewiston-Auburn area work hard to provide competitive pay, just because an employee is eligible for overtime pay does not necessarily mean the employee will earn overtime pay,” Leonard wrote in an op-ed submission to the Bangor Daily News. “Should employers choose to allow extra hours, they first will need to find this money elsewhere in their budget in the middle of an existing budget cycle.”

“The L-A Metro Chamber of Commerce represents 116 nonprofits that, by their very nature, have limited budgets with which to provide critical services to our populations in need,” Leonard wrote. “… Businesses can choose to raise prices to compensate for higher overhead costs (although they often lose sales when they do) but nonprofits have to absorb the loss. Similarly, the rule also will affect the ability of Maine’s colleges and universities to maintain the status quo without raising tuition levels.”

Marcia Benner, the state director of the Society for Human Resource Management, said that her national organization opposes the bill because of the belief that it will put some workers back on hourly schedules, which she said are less flexible for employees.

Benner said she did not have an independent estimate of how many employees or employers would be affected by the change in Maine.

In a release Wednesday afternoon, Sen. Susan Collins (R-Maine) weighed in on the new rule.

“This new rule will be extremely damaging to small businesses, universities, nonprofit organizations, and service industries, particularly in rural states like Maine,” Collins said in a news release. “While I support an increase in the salary threshold, a huge and sudden increase like this could hurt workers and employers alike and limit the services provided by nonprofits and educational institutions.”

Maine Department of Labor Commissioner Jeanne Paquette said Tuesday that the department encourages employers to review the job duties and salary ranges of employees and will be available to help employers interpret the new rules.

“We encourage employers to take time during the implementation period to educate employees about what changes they might expect and ensure that all policies around using leave time, meal and rest break requirements, accessing email or taking calls after hours and other tasks are clear,” Paquette said.


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