ODESSA, TX (KWES) - President Obama announced Wednesday the Department of Labor will increase overtime pay.
A petition to President Obama on We the People back in February of this year reached its goal with over 113,000 signatures. The petition was to tell the Department of Labor to quickly implement the new overtime rule.
General Council Kenneth Besserman of the Texas Restaurant Association said this could increase the cost of labor to restaurants in the Permian Basin.
"Businesses, restaurants work on a very slim profit margin as it is, just 2-3%," said Besserman.
The Department of Labor's website said the overtime rule will raise the salary to 4.2 million employees. Full-time salaried workers in low regions will have their salary raised from $455 a week to $913 a week.
Employees who work over 40 hours will have their employers arrange an option for them. Employers can either pay workers time-and-a-half for overtime hours, raise their salaries to the new threshold, $47,476, or reduce the hours of their 40-hour work week.
The department said the new rule will not affect executive, administrative, or professional employees. But local businesses might be affected.
"Each business is different," said Besserman. "There's no easy solution that works for every business and every business's profit margins are a little bit different. Some allow overtime, some have very little so it may not affect them."
"It's going to hurt us, being a small business here in Odessa," said Fabela's Restaurant manager, Dulce Solis. She said the new rule might affect their food prices. "Being a manager, it worries us because we might have to raise prices or we might have to work around whatever we're going to have to pay the employees. We're going to have to get it from somewhere else."
She said management is going to look into the new rule to see if there are any changes that need to be made.
The new rule will take effect on December 1 so employers will have six months to prepare.