Sherk: President’s Proposals Could Hurt Workers [AUDIO]

Following the President's State of the Union address, we talked with James Sherk on the show about how new government regulations intended help workers could backfire. Sherk is a labor policy expert with the Heritage Foundation.

The first proposal is the President's plan to require businesses to offer seven days paid sick leave to their workers. As Sherk points out:

Businesses care about the total compensation they pay workers. They care much less about how that compensation splits between wages and benefits. Economists have repeatedly found that when the government requires businesses to offer a benefit, they do so – and take the cost out of workers’ pay.

Meanwhile, the second proposal actually could be even more damaging. The Labor Department is expected next month to unveil regulations to grant overtime pay to more salaried workers. Sherk says this likely would do nothing to increase a worker’s take-home pay:

Many employers compensate for increased overtime by simply lowering their workers’ base pay to keep total compensation intact. The regulations would also “effectively turn millions of salaried employees into hourly workers,” Sherk points out, since businesses would be forced to track precise hours worked. And this could mean that flex time, working from home, and other modern business arrangements would be off-limits.

Here's our full conversation with James Sherk: