NEW YORK—A proposal to give millions of U.S. workers a raise is forcing restaurant owner Michelle Shriver to make some hard choices.
The Obama administration’s proposed change in overtime regulations could lead Shriver to put salaried managers on shifts, limiting their hours and making it more difficult to run her six Tropical Smoothie Cafes. Shriver says she can’t afford the overtime she'd have to pay under the proposal.
“Anything you do that relates to wages or salaries is going to cause us to re-evaluate how we staff or run our business,” says Shriver, who has cafes in Nevada and Colorado.
The plan issued by the Labor Department last month would raise from $455 a week to $970 the threshold at which salaried workers must be paid overtime. Some small business owners say that it would force them to change how they pay staffers, cut their hours, or eliminate perks like bonuses because they don’t have the money for overtime for employees who routinely work 45 or 50 hours a week. The proposed change would be particularly hard on owners who rely on managers to oversee their day-to-day operations. It could also force some owners to raise prices or cut the services.
