By Chris Kaergard
PEORIA — A group of more than 40 representatives from business, higher education and not-for-profits gathered Friday for a roundtable discussion with U.S. Rep. Darin LaHood about a proposed federal rule that would more than double the pay level at which an employee can become salaried rather than hourly.
From employee flexibility to the need to serve clientele whose needs occur unpredictably and outside of business hours, the leaders who spoke during the session and at a news conference afterward unanimously expressed worries about the proposed Department of Labor rule that could be implemented within months.
The policy would raise the pay at which an employee could become salaried — and thus exempt from legal requirements to receive overtime pay — from $23,660 to $50,440, according to documents distributed at the event.
“Nobody thinks it would be beneficial to their university or their business or their (not-for-profit),” said LaHood, R-Peoria. “This is not something that people want. You implement a rule or pass a law when there’s a problem that needs to be solved. Nobody thinks this is a problem in central Illinois that needs to be solved.”
Representatives from businesses noted that salaries alone don’t necessarily represent the whole package for their employees, who have other company perks — use of a vehicle, a company-paid phone — that could diminish, along with schedule flexibility for family events if they have to move back to hourly levels.
But other, more unexpected impacts could come to not-for-profits, where required pay increases for staff — or overtime compensation to continue providing services at the same level — could be devastating, representatives warned.
“If this goes through, money that I would be spending to feed children that need food for the weekend and after-school snacks and meals, I wouldn’t have those dollars,” said Lesley Matuszak, the CEO of the Boys and Girls Clubs of Greater Peoria. “People would go hungry. … Hungry children cannot learn.”
Those who sign on at the comparatively lower salaries of not-for-profits understand what they’re getting into, said Mike Kennedy, who heads the Human Service Center.
“It would prohibit them from working the way they work right now, which is, you have a need this hour, they take care of it. It allows them the flexibility that if they work longer one day, they work less another day,” he said.
In fact, restrictions that such institutions could have to implement under the proposed rule — particularly with no new money for raises coming under state contracts that employ 40 there — would drive away workers, said Jim Runyon, executive vice president of Easter Seals of Central Illinois.
Some 85 percent of that staff is female.
“They’re attracted to this work because of the flexibility that being exempt gives them,” he said. “If I have to make them hourly folks, then I lose that attractiveness … to be moms and other busy folks to be able to say, ‘I’m going to set my meetings at 6 o’clock at night because maybe that’s best for the people I’m serving.’ … The ultimate impact will be that wait time, (difficulty of) accessibility to the families we’re serving, is going to increase.”
And, on the higher education front, the effects could be even more unpredictable.
“Much of it isn’t a typical 8 to 5 workday. It really is, in some cases, 24-7,” said Brent Paterson, the interim vice president of student affairs at Illinois State University. “In some cases it’s wavy work. In some parts of the semester it may be extremely busy … there are other times during the semester or between semesters where you may work a lot less.”
That could cause significant changes for the 400 employees at ISU who would be affected by the proposed change, especially in jobs such as academic adviser or college recruiter, where the work ebbs and flows, making it more difficult to fit into a 40-hour, no-overtime week sometimes, assistant vice president for human resources Tammy Carlson said.
“Academic advising doesn’t close at the end of the business day,” she said.
The school’s prospective cost — absent a broadened exemption for educational personnel outside classroom faculty — would be $3.8 million from the rule.
LaHood also is cosponsoring legislation that would require the Obama administration to put a halt to the rule’s implementation and require more analysis of its effects.
Chris Kaergard can be reached at 686-3255 and ckaergard@pjstar.com. Follow him on Twitter @ChrisKaergard.
