At the beginning of 2016, the Department of Labor signed one of the most consequential update to the federal rules on overtime. The new rules doubled the salary threshold for guaranteed overtime pay, from $23,000 to $47,400. The rules went into effect in December, benefiting millions of employees who earlier made less than guaranteed overtime pay under the law when they work more than 40 hours a week.
What Do We Do About Overworked Nonprofit Workers?
Unfavorable reaction, however, came from an unexpected source: a nonprofit called the U.S. Public Interest Research Group (PIRG). The response brings to light the financial constraints nonprofits face today. Even though a lot of nonprofits support the new overtime rules, over 300,000 comments were posted to Regulations.gov, where nonprofits expressed their disapproval. Nonprofits including College and University Professional Association for Human Resources, Habitat for Humanity, and the YMCA of the USA.
“Doubling the minimum salary to $47,476 is especially unrealistic for nonprofit, cause-oriented organizations,” U.S. PIRG said in a statement. “To cover higher staffing costs forced upon us under the rule, we will be forced to hire fewer staff and limit the hours those staff can work - all while the well-funded special interests that we're up against will simply spend more.”
Are Nonprofit Workers Satisfied with their Jobs?
In a 2013 report, the Urban Institute surveyed over 4,000 nonprofits across the U.S. and found that a majority struggled with difficulty securing funding for the cost of their services, delays in payment for contracts, and other financial setbacks.
Moreover, a lot of nonprofits depend on government funding and have annual budgets of less than $1 million. While, they’re expected to perform like businesses, they do not get the same leeway that government-contracted businesses do. Many are expected to meet financial challenges by squeezing more work out of their nonprofit workers without a substantial increase in their pay. In fact, a lot of nonprofits choose to cut wages, benefits, and other costs to scale back to their operations. Nonprofit chiefs are reluctant to do that. So, in response to budget cuts, they try to squeeze more work out of their staffs without a substantial increase in their pay.
A lot of times, the highest amount of work is on the shoulders of the lowest-paid staff, who do unpaid overtime hours. Even then, some nonprofit workers are willing to stay in their jobs, where the working conditions violate labor laws that protect them. One major explanation is because they are committed to the cause and place the organization’s value above everything else. Another possible reason is that there is more competition for an overall fewer number of jobs.
The dissent over recent federal rules speaks volumes about the nonprofits culture where staffs’ needs are put behind mission-driven ambitions.