Overtime Work – Department Of Labor Extends Overtime Work Rights To millions Of Salaried Workers
The Obama Administration announced that the Department of Labor will implement a new rule extending overtime pay rights to millions of American salaried workers on Wednesday. Whether this is good, bad or neutral usually depends on your economic views which is likely highly correlated to your political views and your views on minimum wage (I would guess). I have no opinion as I do not know enough on this topic, but here is what analysts are saying:
Morgan Stanley notes:
Up-and-Coming Small- and Mid-cap Portfolio Managers #MICUS (Morningstar Conference)
Wage growth is on a solidly, albeit slow, upward path. A more pronounced acceleration in wage growth will depend importantly on further gains in our diffusion index, as well as evidence that the broadening out of wages is touching more higher-paying sectors of the labor market.
Dougherty notes in a recent report on Good Times Restaurants
Solid unit level performance offset by softer SSS. GTIM delivered mixed results in Q2 with previously announced SSS at BD and Good Times (GT) missing estimates due to a negative impact from weather along with a drag from the Easter shift. Total sales of $15.3M, up 75% YOY, were in-line with our estimate. We were pleased that adjusted EBITDA of $0.5M beat our $0.2M estimate led by lower food costs, particularly at the GT concept, offset by higher payroll costs from minimum wage pressures in Colorado. The company continued their streak of positive SSS with 0.5% in Q2 for GT and 1.9% for BD. GT positive comp comes in light of lapping a 8.2% comp in Q2 LY as well as a slow start to the year across the full service dining segment.
See the following visualizations which highlight how different states and demographic groups will benefit from the new rule.