The hotel industry supports 8.3 million American jobs in communities across the country and offers desirable assets that attract employees from all walks of life, including flexible hours, career growth, training opportunities, and good-paying jobs and benefit packages. The majority of jobs offered in the hotel industry already have starting wages above the minimum wage, and employers currently have the flexibility to set salary parameters that foster a strong team environment, which allow for good benefits, higher pay, and workable schedules. The industry is ripe with opportunities and has a tremendous track record of providing the training and resources our employees need to move up through the ranks to more senior positions. AHLA embraces policies that encourage business growth, workforce flexibility, and an entrepreneurial spirit.
On September 24, 2019, the Department of Labor released its final rule to update our nation's federal overtime regulations which went into effect on January 1, 2020.
Some of the core provisions include:
- Salary threshold for administrative, executive, and professional employees (the “white collar” exemptions) will now be $684/week, or $35,568/year. This will replace the current threshold of $455/week or $23,660/year (in place since 2004)
- The Highly Compensated Employee threshold will go from $100,000 (in place since 2004) to $107,432.
- There are NO changes to the duties test.
- There are NO automatic updates (which was a focus for AHLA’s comments to the DOL – see attached).
- Employers may use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level, in recognition of evolving pay practices.
The final regulation will be effective January 1, 2020. This will give employers slightly more than 3 months to budget and plan accordingly.
AHLA supports policies and regulations that ensure a fair and equitable working environment for both employees and employers. We believe the new DOL overtime rule accomplishes just that, updating outdated salary levels making more employees eligible for overtime, while providing hoteliers much-needed clarity and certainty moving forward.
- 44.8 percent of all dollars spent to operate a hotel in the United States went to pay for labor-related costs, making it the single largest expense item for operators.
- 61 percent of the hotels in the U.S. are owned and operated by small or independent property owners.
- The majority of hotels pay a starting rate above the minimum wage for at least 90 percent of their entry level employees.
The significant increase in the salary threshold will have a profound negative impact on small and independent business owners who will face real challenges trying to implement this rule.
Members only resource offering high level bullet points on the key issues affecting our industry today.Members Only
Make your voice heard! Here you will have the exclusive access to innovative tools that will allow you to take immediate action on important legislative initiatives through concise emails delivered instantly to your Representatives urging their support of lodging-friendly positions.Take Action