Update on Overtime Pay

  1. plan expands eligibility for overtime pay

    by kirstin downey
    washington post staff writer
    tuesday, april 20, 2004; page a01

    http://www.washingtonpost.com/wp-dyn...referrer=email


    the labor department will allow workers who earn up to $100,000 a year to be eligible for overtime pay, a substantial shift upward from an earlier proposal that democrats had promised to make an issue in the presidential campaign.

    more low-wage workers would become automatically eligible for overtime under the final rules, due to be released today, according to labor department documents describing the regulation. police, firefighters, paramedics, emergency medical technicians and licensed practical nurses will also be assured of eligibility for overtime pay if they work more than 40 hours a week.

    the overtime rules, which haven't been revised in 50 years, have become a major subject of political dispute. the changes have been avidly sought by a wide coalition of business groups. but both houses of congress voted last year to block the bush administration's attempt to issue the rule because of controversy over the number of workers who might be adversely affected.

    a research organization that focuses on labor issues estimated that the proposed changes would cost up to 8 million workers their chance to earn overtime. labor secretary elaine l. chao has countered that the original rules would cost fewer than 1 million more highly paid workers their overtime checks, while expanding overtime eligibility to millions of lower-wage workers.

    the changes to be announced today amount to a more generous proposal for workers on both ends of the pay scale.

    "the final rule accomplishes exactly what we intended from the start, which is to preserve and protect overtime rights for white-collar workers," chao said in a statement last night. "we are pleased to see people recognize the significant gains to workers under our final rule. now there can be no doubt that workers win.''

    some business lobbyists said they had heard that substantial changes were being made in the rules, although they didn't know exactly what to expect. michael eastman, director of labor policy for the u.s. chamber of commerce, said he was disappointed that the labor department had increased overtime eligibility for "highly compensated" workers making $65,000 to $100,000 a year.

    "but we're hopeful there are other improvements in the regulations that will help us in other ways," eastman said. "politics is a process of compromise, and any changes over the current law are better than nothing."

    sen. tom harkin (d-iowa), a critic of the proposed rules, said in a statement last night: "the bush administration simply is not trustworthy on this issue, and i am beyond skeptical about these so-called revisions. this president has gone out of his way time and again to undercut working families' right to overtime pay for overtime work. . . . the senate will soon have the opportunity to stand up and be counted on this issue, and i look forward to the debate."

    the labor department received more than 75,000 letters during the public-comment phase of the process, and thousands more since, with many writers critical of the bush administration for making changes workers feared would cost them money or force them to work longer hours. employer groups and the administration had argued the rules were a much-needed update of regulations issued in 1938, when the u.s. economy was much different.

    the department's summary of the final rule said the changes could give up to 1.3 million low-wage "white collar" workers an additional $375 million in compensation each year. under the current rules, workers who earn less than $8,060 are automatically eligible for overtime -- a level set in the 1970s. the proposed rule had called for raising the cap to $22,100. under the final rule, however, workers who earn up to $23,660, or about $455 a week, will be automatically eligible for overtime.

    some 5.4 million salaried workers who are unsure of their eligibility will be guaranteed overtime rights under the final rule "regardless of their job duties," one labor document said.

    the new regulations will also make no changes to educational requirements or specialized training received in the military.

    some employers, veterans and many labor-activist critics had viewed the proposed regulations as permitting employers to view workers who had attended college or had received specialized military training as potentially exempt from overtime pay under an expanded professional exemption. the labor department had said that interpretation was erroneous, but the new language is expected to clarify the question and ensure that veterans, in particular, do not lose overtime pay.

    ross eisenbrey, vice president of the economic policy institute, the labor-backed research organization that has analyzed and criticized the labor department's proposal, said it sounded as though the department "had made some positive changes." but he said he would reserve judgment until he could review the actual regulations.

    2004 the washington post company
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  2. 9 Comments

  3. by   Energizer Bunny
    *sigh* Still not right in my eyes....although at least those of us that are the poorest are for once being listened to.
  4. by   NRSKarenRN
    Overtime-Pay Complaints End Up in Court More Often
    By Kirstin Downey
    Washington Post Staff Writer
    Saturday, April 10, 2004; Page D12

    http://www.washingtonpost.com/wp-dyn...-2004Apr9.html


    When Secretary of Labor Elaine L. Chao testified at a Senate hearing in January on the need to revamp the nation's overtime pay regulations, she said the outdated rules are costing companies nearly $2 billion a year because of what she termed "needless litigation."

    Many congressional Democrats, backed by worker activists and labor unions, say the expense of litigation is an excuse the Bush administration is using to push changes in the rules that will cost millions of employees their overtime pay. They have continued efforts to block the new rules, which the department is expected to make final any day now.

    Regardless of the debate over motives, it is clear that overtime has become a significant legal issue in recent years.

    Workers around the country are filing a record number of federal lawsuits alleging employers are breaking labor laws by asking them to work longer than 40 hours without proper pay. The Labor Department collected more than $212 million in back pay for workers last fiscal year, the most in a decade. And there have been some sizeable judgments and settlements in overtime suits in recent years.

    The number of federal lawsuits held steady at about 1,500 a year in the 1990s. It rose to 3,904 in 2002, then dropped off to 2,751 last year, according to the Administrative Office of the U.S. Courts. Similar surges are occurring in many state courts, especially in California, where the law is considered more favorable for workers.

    Last month, a California appeals court affirmed a $90 million verdict against Farmers Insurance Exchange that alleged the insurer had cheated 2,042 claims adjustors out of years of overtime pay by saying they were exempt managers. A company spokesman said the insurer would appeal to the California Supreme Court.

    Wal-Mart Stores Inc., the nation's largest retailer, is facing more than three dozen lawsuits alleging workers were paid less than they deserve under law, including suits in California, Florida, Massachusetts, Oregon, Indiana and Minnesota. In February, the Minnesota Supreme Court denied Wal-Mart's appeal of a lower-court ruling granting class-action status to more than 64,000 workers in that state who allege they were denied overtime pay and work breaks.

    In Oregon, a federal jury found the Bentonville, Ark.-based company owed back pay to 80 current and former employees. In late 2002, another Oregon jury ruled that the company made workers at 18 stores in the state work overtime without pay. Wal-Mart officials have said that it is company policy to pay workers for every minute they work and that the lawsuits have no merit.

    In 2001, Starbucks Corp. settled a state court case in California over store managers' overtime for $18 million. Perdue Farms Inc. settled a federal case in Delaware for $10 million in 2002. And Bank of America Corp. settled one in federal court in Washington state last year for $4.1 million.

    Many judges are granting the cases something akin to class-action status, allowing lawyers to solicit scores of present and former employees, making the cases more expensive to defend. Dollar General Corp. is being sued in Alabama, and the judge has opened the case to any of the chain's 6,700 store managers if they were "regularly" asked to work more than 50 hours a week. The company has said it did not violate the law.

    Meanwhile, the number of workers winning back pay because of administration action by the Labor Department jumped 30 percent last fiscal year, to more than 342,000. In November, for example, the department reached an agreement with T-Mobile USA Inc. to pay 20,500 workers some $4.8 million in back wages for "off-the-clock" work for which they weren't compensated.

    Attorneys who represent workers say lawsuits and enforcement actions are increasing because more employers are violating labor law more than in the past. One, Adam T. Klein, said that weak enforcement of labor laws under both the Clinton and Bush administrations has left the private bar "to pick up the slack."

    Brad Seligman, a lawyer who helps fund wage-and-hour lawsuits for workers, said the Labor Department is changing the overtime rules because workers are winning so often. "If these lawsuits are frivolous, why are the settlements and judgments so large? Companies are being caught with clear-cut violations of law that for years they've gotten away with."

    Attorneys who represent employers counter that the overtime rules are no longer suitable for a modern workplace.

    "The rules are so outdated they are a litigator's dream," said Larry Bridgesmith, an attorney who represents corporations. He said a court decision that allows workers to be notified they might be eligible for back pay had "increased the level of interest" among plaintiffs generally and made them eager to pursue claims.

    In some of the court cases, workers said they felt trapped by demands for increased productivity and longer work hours.

    Aldo Cruz, 35, of Hyattsville, a named plaintiff in a federal overtime lawsuit filed in the District last year against AIMCO, a rental-property company, said he worked from 8 a.m. to 5 p.m. each day as a maintenance technician at an apartment complex. He was regularly asked, he said, to be on call 24 hours straight, a period during which he would sometimes get 20 to 30 calls and was unable to get uninterrupted sleep.

    "They didn't pay you for what you worked for," Cruz said in a telephone interview. "It was, 'My way or the highway.' " The company denied the charges.

    Tammy McCutchen, wage and hour administrator at the Labor Department, and a former corporate attorney, said in a statement that the money companies spend defending overtime suits "is money that could be used to create jobs and put money in the pockets of workers. Clearer, up-to-date rules will better protect workers' overtime rights."





    2004 The Washington Post Company
  5. by   mattsmom81
    The Dept of Labor site makes it appear that RN's 'if hourly' will still be eligible for OT pay, but those who are salaried ie management will continue to not be eligible.

    http://www.dol.gov/esa/regs/complian...irpay/main.htm
  6. by   oramar
    notice the mention of the large numbers of letters from voters, some of those came from concerned nurses here
  7. by   VivaLasViejas
    Well, I think it's merely an election-year ploy......what's to keep Bush from messing with it again once the election is over?? (That's assuming he wins, which is NOT assured by any means.....) Despite what he's said about not listening to polls, he knows how angry people are over this issue, and yet he stood firm on it until the last possible minute.......now all of a sudden he's had a change of heart?! Yeah, right I don't believe it for a minute.

    Think about it. IF he's elected (Heaven forbid), he'll be a lame-duck President the second he's sworn in........he can't run again, and Cheney has about as much chance to take his place in 2008 as Ted Kennedy. What's to keep him from having another "epiphany" and revising the overtime bill yet again?

    It's nice to think our OT is safe for now, folks, but I wouldn't bet on keeping it much beyond January 2005 if Bush wins.
  8. by   BeachNurse
    Quote from mattsmom81
    The Dept of Labor site makes it appear that RN's 'if hourly' will still be eligible for OT pay, but those who are salaried ie management will continue to not be eligible.

    http://www.dol.gov/esa/regs/complian...irpay/main.htm
    This is the way that most salaried positions, nursing or not, operate. My husband and I both work salaried staff positions (neither are management) and do not get overtime. My husband works overtime every single day, and will get the occaisonal bonus for his efforts.

    I am in a grant-funded position (no bonuses) and make far less than most hospital nurses. Then again, this is my choice because I love what I do. In addition, I do not get "docked" if I am out 2-3 hours for a sick child or doctor's appointment.
    Last edit by BeachNurse on Apr 21, '04
  9. by   NRSKarenRN
    psna response
    april 21, 2004
    changes to flsa regarding overtime wages and nurses
    the pennsylvania state nurses association continuing to review impact on rns


    harrisburg, pa, april 21, 2004- just two months after pennsylvania state nurses association member (psna), patricia j. hefner, testified before the u.s. senate against a controversial final rule to change overtime provisions in the fair labor standards act (flsa), the bush administration has responded with new changes regarding federal overtime pay rules.

    the department of labor (dol) made the official announcement april 20,2004 stating that under the revised flsa rules, workers who earn up to $100,000 a year will be eligible for overtime pay, a jump in pay scale from the first proposed $65,000 cutoff range.

    in addition, under the final flsa rules, an increased amount of low-wage workers would become eligible for overtime pay - an increase from the previously proposed amount. more specifically, the new revisions allow for licensed practical nurses, police officers, fire fighters and emergency medical technicians to be eligible for overtime pay.

    "this is a testament that when nurses speak up, as a result of staying well-informed to changes impacting their ability to give quality care, our elected officials take notice," said michele p. campbell, msn, rnc, executive administrator of the pennsylvania state nurses association. "however, the pennsylvania state nurses association does not consider this the end. we still want to review the language within the flsa rules regarding registered nurses and how their overtime pay will be impacted - by no means should nurses stop paying attention to this issue."


    the dol reportedly received well over 75,000 letters commenting on the proposed changes to the rules last year.

    in a poll conducted by the psna in march/april 2004, staffing ratios and mandatory overtime continue to be among the top concerns in the minds of pennsylvania nurses.


    the psna continues to encourage all nurses to stay well-informed of how their ability to practice is impacted by decisions and implementations being made everyday by elected officials at the local, state and national levels.
    # # #

    ana response:
    4/21/04

    in response to vocal criticism from a wide array of groups,
    including the american nurses association (ana) and
    members of congress from both sides of the aisle, the
    bush administration has revised its proposed changes to the
    federal overtime pay rules.

    http://www.nursingworld.org/pressrel/2004/pr0420.htm
    Last edit by NRSKarenRN on Apr 22, '04
  10. by   ktwlpn
    Quote from NRSKarenRN
    [b][size=3]Overtime-Pay Complaints End Up in Court
    When Secretary of Labor Elaine L. Chao testified at a Senate hearing in January on the need to revamp the nation's overtime pay regulations, she said the outdated rules are costing companies nearly $2 billion a year because of what she termed "needless litigation."

    Many congressional Democrats, backed by worker activists and labor unions, say the expense of litigation is an excuse the Bush administration is using to push changes in the rules that will cost millions of employees their overtime pay.
    If the gov steps in and stops 'needless litigation" there will be lots of lawyers out of work....How ridiculous...next they will start cutting back on OSHA-keeping the employees safe must cost millions,too....It's all about the welfare of the big business entities.....
  11. by   Mkue
    Yesterday on CSPAN there were three Democrats who were upset with the revised overtime plan, one was Ted Kennedy. Although all three Congressmen admitted they had not read the entire revised plan that they held in their hands, they were upset about it. After reading through the revised plan it appears to me that hourly paid nurses aren't losing overtime pay. Is this true?

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