Published Aug 22, 2004
Myths and Facts on the Bush Administration's New Overtime Regulation
MYTH: Under the Bush Administration's new overtime laws, very few if any workers making between $23,660 and $100,000 a year will lose overtime eligibility.
FACT: The new Bush Administration overtime laws are written such that many workers who currently earn overtime pay in this pay range are likely to lose it. For example:
Concurrent Duties--Under the old rule, an employee who spent a substantial amount of his or her time on nonexempt work but who also performed some exempt supervisory duties generally remained eligible for overtime pay (under old rule 541.116). Under the new rule, that person will generally be an exempt executive, and not eligible for overtime pay. (New section 541.106)
EXAMPLE--An assistant manager in fast-food, grocery or retail may spend most of his or her time performing "line" duties, like burger flipping or ringing up customers, but still be "in charge" of other workers at the same time. Under the old rule, many of these workers still received overtime pay. Under the new rule, they may very well lose their overtime pay, even if they make as little as $23,660 a year--a wage that qualifies a family for food stamps.
Salary Basis Test--The old rule required an employer to pay a worker a salary in order to deprive the worker of the right to overtime pay. The new rule (541.604) defines salary as an hourly wage, so long as the employer guarantees a minimum wage that bear a loose relationship to hourly compensation.
EXAMPLE--Registered nurses (RNs) are very likely to lose their overtime pay rights. RNs' work satisfies the duties test for professionals, but they are paid hourly, and they don't have much freedom to come and go. If they come in to work late, they are docked an hour's pay, for example. They used to receive overtime pay for the many hours of overtime they are required to perform. Under the new rule, they are likely to lose that right.
There are many other examples of how workers in this salary range are likely to lose overtime pay rights. In general, the final overtime regulation will have an especially large impact on workers with minimal supervisory or "leadership" responsibilities, workers who perform minimal amounts of administrative work, workers with special skills, and certain kinds of employees in the computer field.
MYTH: The new Bush Administration overtime law merely clarifies murky law, thus eliminating unnecessary lawsuits. The law is part of its "proven commitment to protecting workers' rights."
FACT: The new Bush Administration overtime law, in fact, lays out in the regulation exemptions which corporations have not been able to win in the courts. For example:
Journalists--There has been a lot of litigation over whether journalists have the right to receive overtime pay. Courts ruled both ways, based on the facts of each case, and many decisions prohibited journalists from losing the right to overtime. The Bush Administration points to the cases in which journalists have lost the right to overtime as the basis for their new rule, which now makes it much harder for journalists to get overtime pay. In fact, there's a big difference between court cases in a limited number of jurisdictions and the new Bush Administration federal rule, which broadens the exemption nationwide for all journalists. (New section 541.302)
Insurance claims adjusters--Again, court cases on whether insurance claims employees receive overtime pay have gone both ways--some courts have said they are exempt and other have said they should receive overtime pay. This is a very heavily-litigated field, and corporations have not been able to win a blanket victory. The Bush Administration has handed them that victory by changing the nationwide regulation to specify that these employees are generally disqualified from receiving overtime pay. (New Section 541.203(a)) A quarter of insurance claims adjusters make less than $35,000 a year.
MYTH: The Bush Administration merely updated the rules to reflect today's modern workplace, but did not strip workers of overtime pay rights.
FACT: The Bush Administration could have supported the Harkin Amendment which allows them to make any updates to the rules, as long as no worker loses overtime pay. In fact, the Bush Administration has made it MORE difficult for many workers in the structure of today's workplace to receive overtime pay.
Team leaders--Many workplaces are moving toward having a team leader structure under which co-workers oversee one another's work. In the old overtime law, the only people disqualified from receiving overtime pay were "staff" who oversaw "special projects." The new Bush Administration overtime law changes that language so that people who do "line" work--whether it's turning out hamburgers or ringing up sales--and who oversee "major projects" will be likely to lose overtime pay rights. "Special projects" implied that there was a definite start and end to the project, whereas the new "major projects" could go on indefinitely, thus knocking many team leaders out of overtime pay rights.
MYTH: The Bush Administration has cut back on the number of lawsuits which will arise over overtime pay.
FACT: The 500 plus page rule and preamble is very likely to lead to MORE, not LESS, litigation. The rule is, at best, ambiguous. It essentially invites employers to push on these ambiguities, forcing workers who lose overtime pay to challenge their new status in court.
Copyright © 2004 AFL-CIO
Hellllllo Nurse, BSN, RN
Excerpt from Dept of Labor website:
Registered nurses who are paid on an hourly basis should receive overtime pay. However, registered nurses who are registered by the appropriate State examining board generally meet the duties requirements for the learned professional exemption, and if paid on a salary basis of at least $455 per week, may be classified as exempt.
Licensed practical nurses and other similar health care employees, however, generally do not qualify as exempt learned professionals, regardless of work experience and training, because possession of a specialized advanced academic degree is not a standard prerequisite for entry into such occupations, and are entitled to overtime pay.
Here is a cut-and-paste of the DOL wesite page that the except was taken from:
August 22, 2004 DOL Home > ESA > WHD > FairPay > Fact Sheets By Occupation
FairPay Fact Sheets by Occupation Under the Fair Labor Standards Act (FLSA)
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Fact Sheet #17N: Nurses and the Part 541 Exemptions Under the Fair Labor Standards Act (FLSA)
The FLSA requires that most employees in the United States be paid at least the federal minimum wage for all hour worked and overtime pay at time and one-half the regular rate of pay for all hours worked over 40 in a workweek. However, Section 13(a)(1) of the FLSA provides an exemption from both minimum wage and overtime pay for employees employed as bona fide executive, administrative, professional and outside sales employees. Section 13(a)(1) and Section 13(a)(17) also exempts certain computer employees. To qualify for exemption, employees must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week.
To qualify for the learned professional employee exemption, all of the following tests must be met:
The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
The employee's primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
The advanced knowledge must be in a field of science or learning; and
The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
Where to Obtain Additional Information
The Department of Labor provides this information to enhance public access to information on its programs. This publication is for general information and is not to be considered in the same light as official statements of position contained in the regulations. For more information regarding the Fair Labor Standards Act, visit the Wage and Hour Division's Web site at http://www.wagehour.dol.gov or call our toll-free help line, available 8 a.m. to 5 p.m. in your time zone, at 1-866-4US-WAGE (1-866-487-9243).
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One of the oh so many reasons I like working where there is a union contract in place.
Spidey's mom, ADN, BSN, RN
I was just on another thread about this titled "Black Monday" . . . . . and all I have to say is
S A L A R I E D :balloons:
So, stevielynn, doesn't that mean that if you work 40 hours or 60 hours, you still are paid the same? Not even flat time for the "overtime?"
Chris, take a look at the thread in the General Nursing Discussions forum. Quotes from the Dept of Labor website say that the new rules apply to "salaried" employees (who haven't been getting OT pay anyway). The new rules do not apply to employees who are paid hourly. Most nurses are paid hourly.
Sounds like most nurses aren't going to be affected.
Most are paid hourly--and the new rules do not apply.
The ones who are paid salaries don't get overtime anyway, so they aren't affected.
Guess I don't understand what the flap is about, nursing wise. No problem! :)
Sounds like most nurses aren't going to be affected. Most are paid hourly--and the new rules do not apply. The ones who are paid salaries don't get overtime anyway, so they aren't affected. Guess I don't understand what the flap is about, nursing wise. No problem! :)
Actually, that's not necessarily the case. The ANA has stated that the language is so vague and contradictory, that employers could opt out of overtime if they wanted to.
I guess we'll have to wait and see what happens to people's overtime checks.
The new law won't affect me because I won't work overtime without overtime pay. I realy don't see what everyone is excited about. As long as the majority of nurses refuse to work overtime without the extra pay then hospitals will have no choice but to continue paying it.
Unless you are covered by a Union contract, an employer can change you from hourly compenstion to salary any time they wish to. There goes your OT rights. That said I don't think in the current job market environment that many employers will take advantage of this abiliity. Once the shortage doesn't exist, especially in a local environment you will see employers make the change. There is just to much money to be saved. And if your institution is in a financial difficulty the pressure to change will be enormous.
BBFRN, BSN, PhD
I can't say this enough: They have redefined SALARIED. It CAN include hourly wages now- especially for those who meet the new standards of OT exemption (read RNs).
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