3/08 Shifting gears - Workers wonder how they'll be affected by new overtime rules, by Andrea Ahles, [Fort Worth] Star-Telegram.
Arlington dental hygienist Nancy Manion Blinn hasn't paid much attention to the debate surrounding the Labor Dept.'s proposed changes to overtime rules because it is unclear how it might affect her profession. Like most dental hygienists, Blinn is paid a daily rate and not necessarily an hourly rate. Currently, she splits her work week between a local pediatric dentist and Children's Medical Center of Dallas. "If I decided to come into [the medical center] five days a week, it would definitely be an issue," because she would most likely switch to an hourly rate and a 40-hour work week, she said.
How the first major revision of overtime rules since 1938 will affect millions of American workers is a question as the Labor Dept. plans to finalize the rules by the end of March. Will millions of U.S. workers benefit, or will they lose the right to make some extra cash when they work more than 40 hours in a week?
Supporters of the Bush administration's plan say the rules needed to be clarified. Opponents say the Labor Dept. is stripping many U.S. workers of their overtime benefits.
As the Labor Dept. gets closer to issuing its final rule changes, employee advocates are working to stop the
implementation of the new rules. Sen. Tom Harkin, D-Iowa, offered an amendment last week that would block the Bush administration from carrying out the changes even if the Labor Dept. issues its final overtime rules before the amendment is enacted into law. "The administration's new rules are a frontal attack on the 40-hour workweek, and they must be stopped," Harkin said in a statement.
Currently, federal law requires employers to pay eligible employees 1.5 times their hourly pay for every hour they work over 40 hours in a week. That law, part of the Fair Labors Standards Act of 1938, will not change. However, guidelines for eligibility for overtime rights will change with the Labor Dept.'s proposals.
Firefighters, police, nurses and military veterans have expressed concern that employers will use the new rules to exempt workers from overtime. But the Labor Dept. says the proposed rules should not affect those occupations. The new rules apply to white-collar workers only, and not to blue-collar workers - such as those in production, construciton and similar industries or occupations covered by collective bargaining aggreements - which are covered by a different set of federal regulations.
The Dept. says that the confusion that surrounds the existing overtime rules makes clarification necessary. In the past few years, several lawsuits have been filed against employers for not paying overtime to workers who were inappropriately exempted. Fort Worth-based RadioShack settled a case in California in 2002, paying $29.9 million to about 1,300 store managers who should have received overtime. And 2,400 California claims adjusters won more than $90 million from Farmers Insurance in 2001 for overtime pay.
Under the proposed rules, salaried workers who make $22,100 a year or less automatically qualify for overtime benefits, up from the previous salary minimum of $8,060. Both sides of the debate agree that this change will help low-income workers, and the Labor Dept. says 1.3 million workers will now qualify with this change. "The proposed rule is a good step in the right direction toward simplifying and clarifying a 50-year-old regulation that is written in terms that are hard for workers and for employers to understand what their obligations and rights really are," said Ron Bird, chief economist at the Employment Policy Foundation.
The new rules also establish a maximum salary threshold of $65,000, which would exempt most white-collar workers at that salary level from overtime benefits. And the rules also revise the definitions of "duties" that employers can use to exempt workers who earn salaries between $22,100 and $65,000 from overtime benefits.
For example, under the proposal, an exempt executive employee would have to manage the business, direct the work of two or more employees and have the authority to hire and fire employees.
To be classified as exempt from overtime benefits, an employee must meet the salary and the duties test, the Labor Dept. says. Employers cannot arbitrarily decide which workers qualify for overtime and which do not.
One of the classifications that the Labor Dept. may change is for "learned professional" employees. Currently, a worker can be classified as a learned professional if his job requires specialized knowledge that the worker obtained through a specific academic degree program, such as an electrical engineering degree.
The proposed changes say workers can obtain that knowledge through work experience or additional job training and do not necessarily need a college degree to be considered exempt.
These changes could cost paralegals, like Fort Worth resident Julie Sherman, the overtime pay that they receive when law firms are involved in time-consuming trials. Sherman, who works for a Fort Worth law firm, said she has worked as both a salaried paralegal and as an hourly employee in her current position. Although she enjoys earning the extra income, she said she preferred being salaried. As a single parent, Sherman said, she sometimes needs to take time off during the day for medical appointments or school activities and worries about making up those lost hours. "The additional pay is nice, but I will be the first to say that I like the flexibility of being a salaried professional," Sherman said. "As an hourly worker, I do feel like I punch a clock more."
Critics say the new "duties" definitions and the maximum salary limit will allow companies to assign exempt status to more hourly workers. The Employment Policy Institute estimates that 8 million U.S. workers will lose their overtime rights under these new definitions. "I expect that employers will reclassify their employees," said Ross Eisenbrey, vice president and policy director at EPI. "People on an hourly basis will be transferred to a salary basis and lose their right to overtime and be required to work longer hours at no additional pay." EPI identified several professions that are likely to be negatively impacted by the rule changes including cooks, retail managers, funeral directors and dental hygienists, such as Blinn.
Labor Dept. officials caution that the proposed changes may or may not be part of the final rules, which will be issued after the Dept. sifts through more than 78,000 comments submitted in response to the proposals. "The Dept. continues to work on developing a final rule that is based on the comments we have received and the debate we have heard," Labor Secretary Elaine Chao said during a congressional hearing in January.
Highlights of proposed overtime changes
The Dept. of Labor is expected to announce changes to federal overtime rules this month. The Dept. released proposed rule changes last year that included these recommendations:
- # Raising the minimum salary requirement to $425 a week from the current level of $155 a week. Salaried workers who make $22,100 a year or less would automatically qualify for overtime benefits.
- # Instituting a maximum salary threshold of $65,000. This would exempt the majority of white-collar workers making $65,000 or more a year regardless of the job.
- # Broadening the definitions of duties for executive, administrative and professional employees that would allow employers to exempt them from overtime benefits.
To be ruled exempt, an employee performing executive duties would have to manage the enterprise, direct the work of two or more employees and have the authority to hire and fire employees.
For those performing administrative duties, the proposal would replace the "discretion and independent judgment" test with a new requirement that employees must hold a "position of responsibility."
For those performing professional duties, the proposal exempts "learned professionals" as employees who gain special training or skills either on the job, through military training or by attending technical school or community college.
Source: Dept. of Labor
How many people will be affected by the rule changes?
The Dept. of Labor says: 1.3 million low-wage workers would gain overtime protections, while only 644,000 paid hourly workers would lose overtime benefits under the proposed new definitions of duties.
The Economic Policy Institute says: 8 million white-collar workers would lose their overtime benefits under the proposed rule changes, and only 700,000 salaried, low-income workers would benefit.
3/06 Website of the Week - Downsizing, by Asst. Editor Trevor Jackson (tjackson@bmj.com), British Medical Journal via BMJ Publishing Group Ltd. via ncbi.nlm.nih.gov
LONDON, U.K. - The internet is generally regarded as a democratic medium, a marketplace of information open to anyone with a mouse and a modem. It is surprising, then, that sites about the effects on health of organisational downsizing—the subject of a paper in this week's BMJ (p 555)—seem stacked more in employers' than in employees' favour. While there are several papers available online showing that downsizing can adversely affect health—search “the world's largest online library” (www.questia.com) or PubMed Central (www.pubmedcentral.nih.gov/) for these—campaigning sites seem scarce. Instead, searching on www.google.com brings up links sponsored by companies offering occupational health services to businesses to help them, for example, reduce cost of sickness absence or “rehabilitate” stressed or absent employees (www.healthmanltd.com/ and www.matrix-ms.com/).
However, there are some interesting online initiatives. Timesizing.com is a US-based site that campaigns to downsize the working week rather than the workforce (www.timesizing.com). Its philosophy is that if hours are cut a little for everyone, everyone stays employed. It is an intriguing and impressively constructed site that claims to offer the world's first dotcom political party (the man behind the site stood to be a Massachusetts senator in 2000).
[Actually, the man behind the website stood against Ted Kennedy to be a U.S. Senator from Massachusetts in 2000, possibly the first Canadian (dual) to run for U.S. Senate, having previously stood against Ted's nephew, Joe, to be a U.S. Representative from the Mass. 8th District in 1996 (possibly the first Canadian to run for U.S. Congress, House of Representatives) and in 1998 when Joe withdrew partway through the race with "Mr.Timesizing" as the major-party opponent and when "Mr.Timesizing" became the Lone Republican as ten Democrats jumped into the race to replace Joe.]
The Job Stress Network (www.workhealth.org/), the home page of the California-based Center for Social Epidemiology, brings together information about job strain and work stress, including downsizing.
General information about employees' health can be found on the sites of various associations of occupational health doctors, but few of these have anything specific on downsizing. However, the internet demonstrates how international an issue occupational health has become with countries linking up to share not only information but also web space. The Baltic Sea Network on Occupational Health and Safety (www.balticseaosh.net/index.shtml) is made up of the occupational health and safety institutions of Denmark, Estonia, Finland, Germany, Latvia, Lithuania, north west Russia, Norway, Poland, and Sweden. While its site contains only two references to downsizing, it is an impressive collection of general occupational health resources, with a useful links page.