Mandatory Overtime: Hurting Working Women

June 19, 2014

Since the recession, fewer women have been participating in the labor force, says Diana Furchtgott-Roth, director of Economics21 at the Manhattan Institute.

  • Women's labor force participation rate has fallen from 76 percent before the recession to 74 percent today.
  • Employment for women between 25 and 54 years of age is 2 million short of pre-recession levels.

President Obama has proposed to extend mandatory overtime pay to several million additional Americans. Unfortunately, Furchtgott-Roth says, the new rules will make it even more difficult for women to participate in the labor force:

  • Overtime rules hurt women, because they reduce their flexibility.
  • Many women with families would prefer to exchange their extra work hours for time off. Doing so allows them to change their work schedules as they need, in order to take care of their children.
  • However, laws requiring overtime pay limit women from negotiating time off with their employers, because employers are legally required to pay them for those hours.

The Labor Department's new rules will only hurt women. On the other hand, the Working Families Flexibility Act of 2013, a bill that has been proposed in the House, would expand the number of employees that can receive time off instead of overtime pay:

  • The bill would allow employers to offer their workers the choice between overtime pay or 1.5 hours of time off per hour of overtime worked.
  • The bill allows employees to choose what is in their own best interest: greater pay, or greater flexibility.

Such a policy would not only help working women with families, but the added flexibility might encourage women who do not work to enter the workforce. Women, much more than men, seek flexibility in their work schedules, placing greater value on time spent with family. One quarter of women work only part time, for this very reason.

Source: Diana Furchtgott-Roth, "To Help Working Women, Set Them Free," Real Clear Markets, June 17, 2014

 

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