Full Version: New Overtime Rules
Browsing through USA Today, I noticed that the Bush administration's new overtime rules are going into effect this week - New overtime rules are mostly bad for employees.
The columnist gives us a little background information on historically why overtime pay was created:
The article then goes on to list some of the changes that will go into effect for all businesses with revenues over $500,000 a year. These mostly look like handouts to businesses to me, at the expense of labor.
Questions for debate:
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
The columnist gives us a little background information on historically why overtime pay was created:
QUOTE
A little history is in order: The federal regulations that govern overtime pay (the Fair Labor Standards Act) were certainly outdated. Most had not been changed since shortly after World War II. Clearly much has changed in the workplace since then and an overhaul of these regulations was needed.
So the U.S. Department of Labor set about updating who would, and would not, be eligible for overtime. It was an issue of importance to many people. Overtime pay serves two useful functions. First, it allows applicable employees to supplement their income. According to an analysis by the Economic Policy Institute, overtime pay accounts for up to 25% of weekly earnings of eligible employees, with the average amount being $161.
Secondly, overtime pay serves a useful position in the overall economy. By requiring overtime, the federal government crafts an incentive for busy employers to create new jobs; rather than pay overtime, a new employee can be brought on. So the old system helped in many ways.
So the U.S. Department of Labor set about updating who would, and would not, be eligible for overtime. It was an issue of importance to many people. Overtime pay serves two useful functions. First, it allows applicable employees to supplement their income. According to an analysis by the Economic Policy Institute, overtime pay accounts for up to 25% of weekly earnings of eligible employees, with the average amount being $161.
Secondly, overtime pay serves a useful position in the overall economy. By requiring overtime, the federal government crafts an incentive for busy employers to create new jobs; rather than pay overtime, a new employee can be brought on. So the old system helped in many ways.
The article then goes on to list some of the changes that will go into effect for all businesses with revenues over $500,000 a year. These mostly look like handouts to businesses to me, at the expense of labor.
Questions for debate:
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
From CNN:
From what I've read it looks like it was due, but has been left alone because it's such a hairy topic - every administration since Carter's has tried to rewrite the rules, but with little success.
It looks like it will have a positive effect on the lowest-paid workers - raising the minimum non-exempt status to 23,660 $ per year. That part seems good to me, as does the mandatory exemption status for anyone making over 100,000 a year. On the down side, I think the third test allows for a lot of abuse. CNN gives the example of a fast food employee who's delegated the responsibility of making fellow employee's work schedules but who doesn't have any authority to hire or fire - that employee would be automatically exempt under the third prong of the new law. It seems like the floodgates are now open for the Walmarts of the world to systematically cheat their mid-level employees out of time and a half.
I would set the non-exempt and exempt levels roughly where they did, possibly a bit higher on the low end and lower on the high end, but change the "administrative" section of the law to make it less vulnerable to corporate malfeasance.
QUOTE
First up is the "salary-basis" test. To be exempt from overtime, workers must be paid a set salary, not an hourly wage. This has long been the rule under federal overtime law. The new rules don't change this requirement.
The second criteria, called the "salary-level" test, has been amended. In order to be exempt from overtime, the new rules require that employees earn a minimum salary of $455 a week, or $23,660 a year. That's triple the prior minimum salary of $155 a week, or $8,060 a year.
White-collar employees who earn more than $100,000 a year are automatically exempt from overtime pay under the new law. That wasn't the case before, although many high-income workers have been exempt for other reasons besides their income level.
The third test is where the rules get considerably more complicated -- and controversial. The final prong is called the "duties" test. It tries to establish eligibility based on the type of work an employee performs every day. Under federal law, a worker whose job is deemed "administrative," "professional" or "executive" in nature does not qualify for overtime. The categories themselves won't change.
The second criteria, called the "salary-level" test, has been amended. In order to be exempt from overtime, the new rules require that employees earn a minimum salary of $455 a week, or $23,660 a year. That's triple the prior minimum salary of $155 a week, or $8,060 a year.
White-collar employees who earn more than $100,000 a year are automatically exempt from overtime pay under the new law. That wasn't the case before, although many high-income workers have been exempt for other reasons besides their income level.
The third test is where the rules get considerably more complicated -- and controversial. The final prong is called the "duties" test. It tries to establish eligibility based on the type of work an employee performs every day. Under federal law, a worker whose job is deemed "administrative," "professional" or "executive" in nature does not qualify for overtime. The categories themselves won't change.
QUOTE
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
From what I've read it looks like it was due, but has been left alone because it's such a hairy topic - every administration since Carter's has tried to rewrite the rules, but with little success.
QUOTE
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
It looks like it will have a positive effect on the lowest-paid workers - raising the minimum non-exempt status to 23,660 $ per year. That part seems good to me, as does the mandatory exemption status for anyone making over 100,000 a year. On the down side, I think the third test allows for a lot of abuse. CNN gives the example of a fast food employee who's delegated the responsibility of making fellow employee's work schedules but who doesn't have any authority to hire or fire - that employee would be automatically exempt under the third prong of the new law. It seems like the floodgates are now open for the Walmarts of the world to systematically cheat their mid-level employees out of time and a half.
QUOTE
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
I would set the non-exempt and exempt levels roughly where they did, possibly a bit higher on the low end and lower on the high end, but change the "administrative" section of the law to make it less vulnerable to corporate malfeasance.
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
I don't think it needed much reform to it. Its simple, for hourly workers if you work past 40 hrs a week, you get overtime. Employers have to pay more if they request workers to labor more than 40 hrs. Its a fair system.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
I think a somewhat positive affect on the lower-class workers, but then again, there were eligible for overtime anyway. For those in the middle, it will create a lot more tension between the employer and employee. I don't quite understand why someone who works in a fast-food chain who makes work schedules would be exempt from overtime. To me, this shows how out of touch the Bush administration is with the average worker.
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
I don't believe overtime needs any reform. The only reason I see reform is to make it easier for corporations to screw there workers out of the pay they deserve. This adminstration think all the problems are relating to lawsuits. The flaw in this thinking is they are assuming the workers are on the wrong side of the issue and the corporations actions are justifiable. But it seems like everything the Bush administration does or justify is for the purpose for pleasing big business under cover of helping Americans. Everyone should know by now if you are a worker, you are a enemy of Bush.
I don't think it needed much reform to it. Its simple, for hourly workers if you work past 40 hrs a week, you get overtime. Employers have to pay more if they request workers to labor more than 40 hrs. Its a fair system.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
I think a somewhat positive affect on the lower-class workers, but then again, there were eligible for overtime anyway. For those in the middle, it will create a lot more tension between the employer and employee. I don't quite understand why someone who works in a fast-food chain who makes work schedules would be exempt from overtime. To me, this shows how out of touch the Bush administration is with the average worker.
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
I don't believe overtime needs any reform. The only reason I see reform is to make it easier for corporations to screw there workers out of the pay they deserve. This adminstration think all the problems are relating to lawsuits. The flaw in this thinking is they are assuming the workers are on the wrong side of the issue and the corporations actions are justifiable. But it seems like everything the Bush administration does or justify is for the purpose for pleasing big business under cover of helping Americans. Everyone should know by now if you are a worker, you are a enemy of Bush.
This is going be a cut and paste job as I just posted this in another topic that was closed (Poll on new Labor Department Rules, in Regards to Overtime) because this one already existed, and I am feeling very lazy :-)
This issue came up in the Republican Party Section of this web site awhile back:
Overtime Pay - Republican Specific Debate on Overtime Pay
What bothered me the most (as I was a Republican at the time) was that so few Republicans bothered to even comment on this issue.
Even if the majority of companies do not bother to make any changes because of this new policy there will be some that will and those workers will be negatively effected due to no fault of their own (unless the voted for Bush). Considering how labor practices have been going lately, I would bet more companies would seek to take advantage of this then many might think.
For example: At my company the office personnel are not unionized. I don't know if this rule is new, or if they just decided to start following it. But as of a month or two ago, if you work over 40 hours in a week where you take a vacation day or get a paid holiday off you do not get overtime pay for the hours over 40 worked in that week. You used to, for 30 years or more according to some of the old old timers there, but not as of a few months ago. The company does not care that the employees feel robbed, they only care that the labor department says this is legal. What is worse, is that for some of those employees overtime is MANDATORY.
Companies are looking to cut costs everywhere they can so that that can still look good to investors without accounting tricks. The biggest expense at most companies is labor, so of course many will look to take advantage of this new savings option.
Where are the Family Values politicians on this issue? Less money at home means an even greater need for two income families. More work hours required by employers means even less parental involvement at home. How is this possibly good for our families or our nation?
The balance between company needs and workers needs in the past has always been met by making working employees over 40 hours a week cost more. With that extra cost gone there is nothing stopping a company from deciding to regularly schedule 50, 60 or more hours a week.
At the bare minimum, the Labor department should have added a maximum mandatory work week of 40 hours a week. Allowing employees to choose the extra hours.
The effect on the economy could be terrible. The extra expense of overtime pay was a reason for companies to hire more workers once their need for more production was seen to be at least semi-permanent.
Now, why deal with the labor laws, benefits costs, hiring procedures, etc when there is no extra cost to simply giving your current employees more hours? Better yet, no risk of having too many employees if your production needs are reduced. You just reduce the current employees hours back to 40 hours a week, or less.
It was already cheaper to pay overtime wages then to hire a new person with benefits and all the admin costs of payroll taxes and the like. Now, it would pretty much be bad business to do so until you were approaching 80 work weeks for your employees (at which time rising health issues and reduced productivity due to fatigue would become too expensive).
The result will likely be less employment opportunities and thus higher unemployment and more people on public assistance.
Let us also not forget that many workers who regularly get overtime SPEND THAT MONEY. Loss of that extra 1/2 time wage means a loss of consumer spending in the streets to the detriment of our economy. Many blue collar workers benefited from the Bush tax cuts, but the loss of overtime pay would negate that for many of them.
This could easily cost President Bush this Election. And if this is allowed to be implemented, it should. As a union member I can tell you that MANY union members (though few if any union leaders) are closet Republicans that quietly vote conservative every election. They ignore the union leadership rhetoric about the Republicans only caring about corporations. How can they ignore it now?
This issue will cost Bush a majority of the votes he could have counted on from Blue collar America, and many votes from lower wage white collar workers as well.
An interesting side note on this issue is that the group effected the least by this issue is the group making the most noise. That group being Unions.
Union Employees have contracts. In those contracts work hours, the work week, overtime, and an enormous amount of other things are detailed out.
This change at the labor department will not effect those contracts. So no union employee will be effected immediately. It could however, become a contract negotiation issue later down the road.
In a strange twist, This issue will breathe new life into unions. This change will strengthen unions, making them and their contracts more attractive to workers. It surprises me that the unions would fight it at all.
It will also weaken the Republican party. Many on this site have pointed out in the past how there are many union members are actually Rush Limbaugh conservatives. How many will remain with the Republicans after this?
There is simply no area that this policy make sense.
:::stepping down from soapbox:::
This issue came up in the Republican Party Section of this web site awhile back:
Overtime Pay - Republican Specific Debate on Overtime Pay
What bothered me the most (as I was a Republican at the time) was that so few Republicans bothered to even comment on this issue.
QUOTE
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
Even if the majority of companies do not bother to make any changes because of this new policy there will be some that will and those workers will be negatively effected due to no fault of their own (unless the voted for Bush). Considering how labor practices have been going lately, I would bet more companies would seek to take advantage of this then many might think.
For example: At my company the office personnel are not unionized. I don't know if this rule is new, or if they just decided to start following it. But as of a month or two ago, if you work over 40 hours in a week where you take a vacation day or get a paid holiday off you do not get overtime pay for the hours over 40 worked in that week. You used to, for 30 years or more according to some of the old old timers there, but not as of a few months ago. The company does not care that the employees feel robbed, they only care that the labor department says this is legal. What is worse, is that for some of those employees overtime is MANDATORY.
Companies are looking to cut costs everywhere they can so that that can still look good to investors without accounting tricks. The biggest expense at most companies is labor, so of course many will look to take advantage of this new savings option.
Where are the Family Values politicians on this issue? Less money at home means an even greater need for two income families. More work hours required by employers means even less parental involvement at home. How is this possibly good for our families or our nation?
The balance between company needs and workers needs in the past has always been met by making working employees over 40 hours a week cost more. With that extra cost gone there is nothing stopping a company from deciding to regularly schedule 50, 60 or more hours a week.
At the bare minimum, the Labor department should have added a maximum mandatory work week of 40 hours a week. Allowing employees to choose the extra hours.
The effect on the economy could be terrible. The extra expense of overtime pay was a reason for companies to hire more workers once their need for more production was seen to be at least semi-permanent.
Now, why deal with the labor laws, benefits costs, hiring procedures, etc when there is no extra cost to simply giving your current employees more hours? Better yet, no risk of having too many employees if your production needs are reduced. You just reduce the current employees hours back to 40 hours a week, or less.
It was already cheaper to pay overtime wages then to hire a new person with benefits and all the admin costs of payroll taxes and the like. Now, it would pretty much be bad business to do so until you were approaching 80 work weeks for your employees (at which time rising health issues and reduced productivity due to fatigue would become too expensive).
The result will likely be less employment opportunities and thus higher unemployment and more people on public assistance.
Let us also not forget that many workers who regularly get overtime SPEND THAT MONEY. Loss of that extra 1/2 time wage means a loss of consumer spending in the streets to the detriment of our economy. Many blue collar workers benefited from the Bush tax cuts, but the loss of overtime pay would negate that for many of them.
This could easily cost President Bush this Election. And if this is allowed to be implemented, it should. As a union member I can tell you that MANY union members (though few if any union leaders) are closet Republicans that quietly vote conservative every election. They ignore the union leadership rhetoric about the Republicans only caring about corporations. How can they ignore it now?
This issue will cost Bush a majority of the votes he could have counted on from Blue collar America, and many votes from lower wage white collar workers as well.
An interesting side note on this issue is that the group effected the least by this issue is the group making the most noise. That group being Unions.
Union Employees have contracts. In those contracts work hours, the work week, overtime, and an enormous amount of other things are detailed out.
This change at the labor department will not effect those contracts. So no union employee will be effected immediately. It could however, become a contract negotiation issue later down the road.
In a strange twist, This issue will breathe new life into unions. This change will strengthen unions, making them and their contracts more attractive to workers. It surprises me that the unions would fight it at all.
It will also weaken the Republican party. Many on this site have pointed out in the past how there are many union members are actually Rush Limbaugh conservatives. How many will remain with the Republicans after this?
There is simply no area that this policy make sense.
:::stepping down from soapbox:::
I'm a union member, and my contract states I get paid 1.5x my rate for hours worked over 42h a week (my regular schedule), however, FLSA only requires OT to be paid for firefighters when they work more than 53h per week. There's an old DC control board law, that wasn't overturned when DC got 'home rule' back, that prohibits DC from paying employees anything over the FLSA schedule...no big deal for everyone else and their 40h workweeks, but definitely hurting the firefighters. The DC law takes precedence over the Union contract. I assume this law will wind up hurting a lot of other DC employees, but I haven't heard anything about it.
I agree on the unionized closet republicans, I imagine a majority of firefighters vote republican on national elections anyway.
I agree on the unionized closet republicans, I imagine a majority of firefighters vote republican on national elections anyway.
QUOTE
I agree on the unionized closet republicans, I imagine a majority of firefighters vote republican on national elections anyway.
You might want to consider using the past tense on that from now on.
Another thing that bothers me about this whole thing was that when it was first announced they said they were going to delay implementation to allow for public redress.
Yet the AFL-CIO PAID for space in a Labor Department Auditorium to address this very issue and the Labor Department canceled the meeting. Last I knew, there was no new date set for it.
Anyone get a chance to tell the Labor Department what they thought about this? And groups, Organizations, unions, or Individuals get time with the labor department to voice their concerns. As best as I can tell the answer is no.
I know that while I was still a Registered, volunteering and donating Republican I wrote to every GOP member I could think of, from my Senators, to the RNC, to my local GOP leadership and even the whitehouse. I probably spent over $5.00 in postage alone. To date not one of these people bothered to respond to, or even acknowledge any of my concerns.
This issue, and that lack of response from the GOP was one of the key reasons I withdrew my name, my money and my time from the Republican Party.
Immigration policy, out of control spending, and their public desire to amend the constitution to keep rights away from one group of people (for the first time in history) were some of the other major players in that decision.
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
The handouts to business in the new rules are essentially codifying and sanctioning what the vast majority of employers were doing already.
I used to edit a trade publication for payroll professionals, and the old 'exempt' vs. 'non-exempt' rules were so poorly understood, and so badly applied that I had a state Wage & Hour investigator tell me that in 20 years, he had NEVER gone into a shop and not found at least one person who was wrongly classified as 'exempt.'
What helped employers in this was the widespead employee perception that those who did white-collar work of any responsibility were automatically exempt from OT. There was, and remains, a certain sort stigma attatched to being 'just' and hourly worker.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
I cant speak to the macroeconomic effects of the new policy, but at the micro- level, I trust that the new policy will be used by many employers to further muddy the waters on who's exempt from OT. Most workers had no idea what the exact rules were under the FLSA-- and they still wont'. That's cynical, but I think given past, widespread performance by employers, it's true.
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
I think the FLSA did need to be reformed. I would have handled it this way:
1. If you make over $100,000 a year in any combination of pay, bonuses, or value of stock options, you are automatically exempt.
2. Otherwise, if you work more than 40 hours, you get time-and-a-half for every hour thereafter, regardless of what you do for a living.
At least then people would know whether they were getting cheated by their bosses.
Would this cost employers money? Yup. Lots. And in 60 years or so, they might actually pay out the amount of money they've stolen from their employees since the FLSA went into effect in the 30s.
The handouts to business in the new rules are essentially codifying and sanctioning what the vast majority of employers were doing already.
I used to edit a trade publication for payroll professionals, and the old 'exempt' vs. 'non-exempt' rules were so poorly understood, and so badly applied that I had a state Wage & Hour investigator tell me that in 20 years, he had NEVER gone into a shop and not found at least one person who was wrongly classified as 'exempt.'
What helped employers in this was the widespead employee perception that those who did white-collar work of any responsibility were automatically exempt from OT. There was, and remains, a certain sort stigma attatched to being 'just' and hourly worker.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
I cant speak to the macroeconomic effects of the new policy, but at the micro- level, I trust that the new policy will be used by many employers to further muddy the waters on who's exempt from OT. Most workers had no idea what the exact rules were under the FLSA-- and they still wont'. That's cynical, but I think given past, widespread performance by employers, it's true.
3. If you believe overtime does need reform, what is the right answer here? Did the Bush administration nail it or would you have handled it a different way? Please explain your solution.
I think the FLSA did need to be reformed. I would have handled it this way:
1. If you make over $100,000 a year in any combination of pay, bonuses, or value of stock options, you are automatically exempt.
2. Otherwise, if you work more than 40 hours, you get time-and-a-half for every hour thereafter, regardless of what you do for a living.
At least then people would know whether they were getting cheated by their bosses.
Would this cost employers money? Yup. Lots. And in 60 years or so, they might actually pay out the amount of money they've stolen from their employees since the FLSA went into effect in the 30s.
1. Is the practice of overtime due for reform or does it still achieve the same results as before in a manner mutually beneficial to employees and employers?
I think that overtime regulations are due for reform in order to simplfy them and make sure that every eligible employee is in fact getting paid what they deserve. If you take a look at the Department of Labor page which covers hourly wages, you'll see that it is nigh impossible to dicpher who is eligible and who isn't with a reasonable degree of certainty.
There are three things to consider when looking at the complexity of these regulations.
1) There are probably many small and medium businesses who really don't fully understand these regulations and the impact on their work force causing them to be in violation of them and deny workers their pay.
2) There are probably quite a few businesses that do understand the regulations but decide to ignore them so that their can reduce their labor costs illegally.
3) Then you have the worker, who most certainly isn't going to understand the regulations without some kind of legal and/or expert counsel.
I definitely like Kyle Coyote's idea of simplfying things.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
It is going to have a negative impact on the economy and as OverlandSailor pointed out, it very possibly might negatively impact the Bush campaign by taking away votes from the working class.
As several people have said, overtime is good for a few things and as far as the economy is concerned it really breaks down to two major points:
1) There is a certain point where paying overtime no longer makes financial sense and the company should hire another person for the job. This threshold will be raised by eliminating overtime for some positions.
2) The people that earn overtime generally count on that as part of their salary and they also generally turn around and spend that money, boosting the economy.
I think that overtime regulations are due for reform in order to simplfy them and make sure that every eligible employee is in fact getting paid what they deserve. If you take a look at the Department of Labor page which covers hourly wages, you'll see that it is nigh impossible to dicpher who is eligible and who isn't with a reasonable degree of certainty.
There are three things to consider when looking at the complexity of these regulations.
1) There are probably many small and medium businesses who really don't fully understand these regulations and the impact on their work force causing them to be in violation of them and deny workers their pay.
2) There are probably quite a few businesses that do understand the regulations but decide to ignore them so that their can reduce their labor costs illegally.
3) Then you have the worker, who most certainly isn't going to understand the regulations without some kind of legal and/or expert counsel.
I definitely like Kyle Coyote's idea of simplfying things.
2. Will the Bush administration's new policy on overtime have a net positive or negative effect on workers and the economy?
It is going to have a negative impact on the economy and as OverlandSailor pointed out, it very possibly might negatively impact the Bush campaign by taking away votes from the working class.
As several people have said, overtime is good for a few things and as far as the economy is concerned it really breaks down to two major points:
1) There is a certain point where paying overtime no longer makes financial sense and the company should hire another person for the job. This threshold will be raised by eliminating overtime for some positions.
2) The people that earn overtime generally count on that as part of their salary and they also generally turn around and spend that money, boosting the economy.
I might have jumped the gun here. 
This is a fact sheet from the department of Labor that describes who is exempt:
DOL fact sheet
It seems that to qualify for the exemptions at least 60% of your work (depending on the exemption) needs to be in the same class as the exemption.
And, if I am reading this all correctly NO Blue Collar workers seem to be exempt from OT pay.
The a fact sheet from the department of Labor:
DOL Fact Sheet of Blue Collar workers
Assuming I read all of this correctly it would appear that blue collar workers have nothing to be concerned about, and a few in low wage categories might get OT where they were denied it before.
As for first responders:
It would seem to me that Federal labor law now states that First Responders are entitled to OT for hours worked over 40 per pay week. I don't believe local or state laws can change this, though I could be missing something.
Perhaps someone not opposed to these new rules could explain these issues a little better.
Now that the Rabid dog (me)
in this discussion has been "fixed" and has calmed down a bit maybe we can figure this thing out.
I think we really need to look at this to determine just how much of what we think this is about is just political rhetoric and how much is actually fact. I know I was fooled.
This is a fact sheet from the department of Labor that describes who is exempt:
DOL fact sheet
It seems that to qualify for the exemptions at least 60% of your work (depending on the exemption) needs to be in the same class as the exemption.
And, if I am reading this all correctly NO Blue Collar workers seem to be exempt from OT pay.
The a fact sheet from the department of Labor:
DOL Fact Sheet of Blue Collar workers
Assuming I read all of this correctly it would appear that blue collar workers have nothing to be concerned about, and a few in low wage categories might get OT where they were denied it before.
As for first responders:
QUOTE
Police officers, detectives, deputy sheriffs, state troopers, highway patrol officers, investigators, inspectors, correctional officers, parole or probation officers, park rangers, fire fighters, paramedics, emergency medical technicians, ambulance personnel, rescue workers, hazardous materials workers and similar employees (“first responders”) who perform work such as preventing, controlling or extinguishing fires of any type; rescuing fire, crime or accident victims; preventing or detecting crimes; conducting investigations or inspections for violations of law; performing surveillance; pursuing, restraining and apprehending suspects; detaining or supervising suspected and convicted criminals, including those on probation or parole; interviewing witnesses; interrogating and fingerprinting suspects; preparing investigative reports; and other similar work are not exempt under Section 13(a)(1) or the regulations and thus are protected by the minimum wage and overtime provisions of the FLSA.
sourceIt would seem to me that Federal labor law now states that First Responders are entitled to OT for hours worked over 40 per pay week. I don't believe local or state laws can change this, though I could be missing something.
Perhaps someone not opposed to these new rules could explain these issues a little better.
Now that the Rabid dog (me)
in this discussion has been "fixed" and has calmed down a bit maybe we can figure this thing out.I think we really need to look at this to determine just how much of what we think this is about is just political rhetoric and how much is actually fact. I know I was fooled.
QUOTE(overlandsailor @ Aug 24 2004, 08:13 PM)
It seems that to qualify for the exemptions at least 60% of your work (depending on the exemption) needs to be in the same class as the exemption.
One problem is with the very tools of analysis of the DOL.
At work last week, what did you spend 60% of your time doing? Wait.. before you answer, are you SURE it was not 59%? Is that the same sort of task that you spent 60% of your time on two weeks ago? How about next month?
People with varying job tasks in a hectic environment might be able to make educated guesses at those numbers, but... oh yes, the employees aren't doing the numbers-- it's the payroll department and perhaps utlimately the CFO. Does your payroll guy or gal really know what you do all day?
Further, it was perfectly possible under the old rules (I can't speak to the new ones on this just yet) for an employee to be exempt one week and non-exempt the next, solely based on job tasks. Ever hear of anyone getting this call from payroll? 'Hey, buddy, you get OT this pay period since we have you filling in for that underling who quit unexpectedly. Congrats.'
First responders must get paid overtime if they work more than 212 hours in a 28 day pay cycle if they are firefighters; 171 hours in a 28 day pay cycle if they are cops; and 160 hours in a 28 day pay cycle if they are EMS workers.
The law states that none of them are exempt from recieving overtime, however it does not change the number of hours required to work before receiving it.
Hopefully, if Kerry is elected, he will repay the IAFF by reassessing the average workweek of firefighters and reduce it from 53 to something closer to 40.
Personally, I don't mind (too much) getting regular pay for voluntarily working an overtime shift, but it's a pain the wallet to get paid straight time when you get held over for an hour because someone called in sick.
The law states that none of them are exempt from recieving overtime, however it does not change the number of hours required to work before receiving it.
Hopefully, if Kerry is elected, he will repay the IAFF by reassessing the average workweek of firefighters and reduce it from 53 to something closer to 40.
Personally, I don't mind (too much) getting regular pay for voluntarily working an overtime shift, but it's a pain the wallet to get paid straight time when you get held over for an hour because someone called in sick.
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First responders must get paid overtime if they work more than 212 hours in a 28 day pay cycle if they are firefighters;
That breaks down to 7.58 (rounded up) hours a day.
I understand the concept that you could possibly work 224 hours (16 hours a day) in 14 day period, be off the next two weeks and thus only get 12 hours of overtime (where others in the US would get 72 hours of OT a week). I am just curious how often this kind of thing happens?
I can see how irritating it would be, to work an extra 2 hours one week and not get paid OT for it. But, if you are regularly scheduled, wouldn't they have to send you home early to avoid the OT at the end of the month?
I'm just trying to understand this.
BTW I found a link for the rues you were referring too. link
There are two big problems I see with the new rules.
This effectively means anyone who manages people. If you are a blue collar mechanic and you happen to be a "shift supervisor" in charge of several mechanics, guess what? You do not have to be paid overtime anymore.
People think "management" is associated with high dollar jobs that are salaried and they forget that almost every single blue collar job has some kind of supervisor position where that person is in charge of people and in a lot of cases can advise on hire/fire decisions. These people just lost overtime.
So with this rule the DOL basically removed overtime for every single IT worker in the country. There are people that do get paid overtime now if they are in a support role like a system admin, database administrator, etc. They are frequently asked to work overtime when a new application is released or if there is a serious problem with their systems and they have to fix it.
When I was working in consulting we got paid overtime for any hours over 40 that we worked. The company increased the hour limit to 50 towards the end of my tenure there due to financial reasons, but now they could eliminate it all together if they wanted to.
I'm sure that some of the other rules will effect other jobs as well. It is clear to me though, that this is NOT a good thing for employees.
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Rule 4: Managers are not entitled to overtime if they oversee two or more people and have the authority to hire, fire, or recommend that someone be hired or fired.
This effectively means anyone who manages people. If you are a blue collar mechanic and you happen to be a "shift supervisor" in charge of several mechanics, guess what? You do not have to be paid overtime anymore.
People think "management" is associated with high dollar jobs that are salaried and they forget that almost every single blue collar job has some kind of supervisor position where that person is in charge of people and in a lot of cases can advise on hire/fire decisions. These people just lost overtime.
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Rule 7: Employees whose main duties are computer-related and involve the implementation, analysis, development, or application of computer systems or designs are also not eligible for overtime.
So with this rule the DOL basically removed overtime for every single IT worker in the country. There are people that do get paid overtime now if they are in a support role like a system admin, database administrator, etc. They are frequently asked to work overtime when a new application is released or if there is a serious problem with their systems and they have to fix it.
When I was working in consulting we got paid overtime for any hours over 40 that we worked. The company increased the hour limit to 50 towards the end of my tenure there due to financial reasons, but now they could eliminate it all together if they wanted to.
I'm sure that some of the other rules will effect other jobs as well. It is clear to me though, that this is NOT a good thing for employees.
overland, most firefighters work 24h shifts with either 2 days off (56h workweek); 2 days off plus one extra day off every cycle (48h workweek), or 3 days off (42h workweek). The places with the 42h workweek are usually cities, with busier fire companies, many of these cities work a 9-12h day shift and the balance on a night shift. Some firefighters in bedroom communities and suburbs work entirely daywork, from 8-12h a day, with volunteers working at night. These are the guys hurt most by these rules, I know of some in right-to-work states where these guys work 5 10h days a week as their regular shift.
The laws stem from A) at one time 53h was the average, when federal (not very busy) firefighters worked 72h workweeks and
many, if not most, firefighters are allowed to sleep at work (though, in the city, the residents calling are usually not so considerant). Again, those guys on day work are getting the short end of the stick.
So, the number of hours you work depend on your schedule, and most work well over 40h a week, over a 28d cycle. However, the nature of the business is such that someone always has to be at work, so there's usually extra hours to work, which is where the overtime comes in.
It seems these rules mean that a lieutenant in charge of 4 guys would be exempt from OT, despite the fact that he's doing pretty much the same job. Which would mean that most people would wind up taking a pay cut by getting promoted. I imagine it's be the same for any sort of shop where a foreman is in charge of a few other workers doing pretty much the same thing.
The laws stem from A) at one time 53h was the average, when federal (not very busy) firefighters worked 72h workweeks and
many, if not most, firefighters are allowed to sleep at work (though, in the city, the residents calling are usually not so considerant). Again, those guys on day work are getting the short end of the stick.So, the number of hours you work depend on your schedule, and most work well over 40h a week, over a 28d cycle. However, the nature of the business is such that someone always has to be at work, so there's usually extra hours to work, which is where the overtime comes in.
It seems these rules mean that a lieutenant in charge of 4 guys would be exempt from OT, despite the fact that he's doing pretty much the same job. Which would mean that most people would wind up taking a pay cut by getting promoted. I imagine it's be the same for any sort of shop where a foreman is in charge of a few other workers doing pretty much the same thing.
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Executive Exemption
Applicable to employees who have management as their primary duty; who direct the work of two or more full-time employees; who have the authority to hire and fire or make recommendations regarding decisions affecting the employment status of others; who regularly exercise a high degree of independent judgment in their work; who receive a salary which meets the requirements of the exemption; and who do not devote more than 20% of their time to non-management functions (40% in retail and service establishments).
Applicable to employees who have management as their primary duty; who direct the work of two or more full-time employees; who have the authority to hire and fire or make recommendations regarding decisions affecting the employment status of others; who regularly exercise a high degree of independent judgment in their work; who receive a salary which meets the requirements of the exemption; and who do not devote more than 20% of their time to non-management functions (40% in retail and service establishments).
Management exemptions are no longer based on title and are pretty cut and dried. If a Mechanic spends the majority of his shift (more then 20% of it) as a mechanic then he can not qualify for this exemption.
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Blue-Collar Workers
The exemptions provided by FLSA Section 13(a)(1) do not apply to manual laborers or other “blue-collar” workers who perform work involving repetitive operations with their hands, physical skill and energy. Such nonexempt “blue-collar” employees gain the skills and knowledge required for performance of their routine manual and physical work through apprenticeships and on-the-job training.
FLSA-covered, non-management employees in production, maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, construction workers and laborers are entitled to minimum wage and overtime premium pay under the FLSA, and are not exempt under Section 13(a)(1) of the FLSA nor the regulations at 29 CFR Part 541, no matter how highly paid they might be.
The exemptions provided by FLSA Section 13(a)(1) do not apply to manual laborers or other “blue-collar” workers who perform work involving repetitive operations with their hands, physical skill and energy. Such nonexempt “blue-collar” employees gain the skills and knowledge required for performance of their routine manual and physical work through apprenticeships and on-the-job training.
FLSA-covered, non-management employees in production, maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, construction workers and laborers are entitled to minimum wage and overtime premium pay under the FLSA, and are not exempt under Section 13(a)(1) of the FLSA nor the regulations at 29 CFR Part 541, no matter how highly paid they might be.
He it seems to state that anyone this simply does not apply to blue collar workers. In the same mechanic example, the mechanic, being a blue collar job (IE a job where work involves repetitive operations with their hands, physical skill and energy) is specifically outside the exemptions. Mechanics are actually specifically mentioned.
I understand you point about IT workers. Having never been one I don't know how things were prior to these new regs. I have two friends who are in IT, and who did not get OT prior to these new rules as their employer considered them learned professionals. I don't know if that was right, or if that was the norm across the country.
I think that there should be a single principle underlying all overtime regulation.
This principle is that if you put in extra hours above what you are contracted to do off your own bat, you don't get paid overtime (in fact, you don't get paid at all for these extra hours). This is about you managing your own work effectively, so it's your own choice and your own responsibility.
If the business asks that you to work extra hours above your contracted hours, they pay you at the rate detailed in your contract of employment. (Time and a half for normal working days, double or triple time if if it's a day you wouldn't normally expect to work - Sundays or public holidays for most people.)
Basically, the only person who cannot possibly get paid overtime under this rule of thumb is the top boss, head honcho, capo de tutti capi or however you like to think of him or her. In practice, most of the senior management team will not be eligible for overtime.
In most cases, the capacity for paid overtime should be "bought out" by the boss in the contract; i.e. they pay over the odds as a basic package to compensate for the fact that they expect you to work all the hours God sends trying to keep up with the workload they give you.
If it is not the norm for non-union workers to HAVE a contract of employment, The I humbly suggest that American business needs to wake up and smell the late 19th century. A contract doesn't necessarily do away with the Paleolithic "fire at will" principle used in some part of America, it just puts into writing that the boss can sack workers on a whip if they want to do so.
Of course, this is probably far too bureaucratic and socialist a concept for many to accept. I just can't help thinking that the productivity cow of loading as much as possible of the requirement for flexibility onto employees has been milked dry in the USA, and any further gains will have to be made by changing business, not the workforce.
The risk of continuing on this trajectory is that American workers will either start dropping like flies at their desks through overwork, while the bosses sink that important putt on the 15th; or that there will be a backlash. The problem with backlashes is that they tend to be extreme, so if American business doesn't want to be saddled with a French-style 35-hour legal mazimum work week at some future point, they'd better start playing a lot nicer with their employees now.
(My use of the French example is deliberate - extremes in either direction are just as bad both socially and economically.)
This principle is that if you put in extra hours above what you are contracted to do off your own bat, you don't get paid overtime (in fact, you don't get paid at all for these extra hours). This is about you managing your own work effectively, so it's your own choice and your own responsibility.
If the business asks that you to work extra hours above your contracted hours, they pay you at the rate detailed in your contract of employment. (Time and a half for normal working days, double or triple time if if it's a day you wouldn't normally expect to work - Sundays or public holidays for most people.)
Basically, the only person who cannot possibly get paid overtime under this rule of thumb is the top boss, head honcho, capo de tutti capi or however you like to think of him or her. In practice, most of the senior management team will not be eligible for overtime.
In most cases, the capacity for paid overtime should be "bought out" by the boss in the contract; i.e. they pay over the odds as a basic package to compensate for the fact that they expect you to work all the hours God sends trying to keep up with the workload they give you.
If it is not the norm for non-union workers to HAVE a contract of employment, The I humbly suggest that American business needs to wake up and smell the late 19th century. A contract doesn't necessarily do away with the Paleolithic "fire at will" principle used in some part of America, it just puts into writing that the boss can sack workers on a whip if they want to do so.
Of course, this is probably far too bureaucratic and socialist a concept for many to accept. I just can't help thinking that the productivity cow of loading as much as possible of the requirement for flexibility onto employees has been milked dry in the USA, and any further gains will have to be made by changing business, not the workforce.
The risk of continuing on this trajectory is that American workers will either start dropping like flies at their desks through overwork, while the bosses sink that important putt on the 15th; or that there will be a backlash. The problem with backlashes is that they tend to be extreme, so if American business doesn't want to be saddled with a French-style 35-hour legal mazimum work week at some future point, they'd better start playing a lot nicer with their employees now.
(My use of the French example is deliberate - extremes in either direction are just as bad both socially and economically.)
Hey, Julian, how about a 'card check' unionization rule, with the 'right to work', whereby, as an employee, you may refrain from joining the local, but you must pay a service fee (not full dues) to the union for collective bargaining costs, and you must abide by the collective bargaining agreement. This is how my local works (without the card check - we're already union, and have been for quite some time). As a point of fact, dues are like $20 a 2wk paycheck, the fee is like $12, and well over 95% of eligible employees are full members (they get a vote, can serve on committees, and get extra dental, optical, and legal plans).
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