Mid-Term Senate Races Matter: Heller’s High Water

U.S. Senator Dean Heller (R-NV) released the below statement after a right-leaning federal judge in Texas nullified the Obama Administration’s Department of Labor overtime rule.

“The former Obama Administration’s expansion of the federal overtime rule would have devastated Nevada’s business owners and job creators. Since the rule was issued last year, I have been strongly concerned about its impact because it would fundamentally change how employers compensate their workers, reducing Nevadans’ work hours and benefits. I’m pleased to see that a federal judge acknowledged the regulation’s harmful consequences and ruled it invalid today,” Heller said. “Today’s news is a relief for countless Nevada businesses and employers, and I commend Nevada Attorney General Adam Laxalt for his leadership in this fight.”

Heller has worked tirelessly at undermining the Obama-era overtime rule aimed at leveling the playing field for workers. Instead, he’s worked to bolster the bottom line of his corporate benefactors. Don’t believe me?  As evidence —

  • In February 2016 he wrote to Department of Labor Secretary Tom Perez about this rule and what he claimed would be its negative impacts on corporations in the state of Nevada.
  • In March 2016, he followed up with yet another letter highlighting his concerns over the new policy change.
  • In the Senate, Heller expressed concerns with his Senate colleagues by writing to Senate Appropriations Subcommittee on Labor, Health and Human Services, Education and related Agencies Chairman Roy Blunt and Ranking Member Patty Murray.

Heller also cosponsored S. 2707, the Protecting Workplace Advancement and Opportunity Act, in the 114th Congress, legislation that would have cancelled the proposed DOL regulation to increase the salary threshold for workers eligible to receive overtime pay and require impact studies for future proposals of related rules.

Protecting Workplace Advancement and Opportunity Act

S.2707 declared that the proposed or the final rule of the Department of Labor entitled “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees” shall cease to have any force or effect. The rule revises the “white collar” exemption of executive, administrative, professional, outside sales, and computer employees from minimum wage and maximum hour, or overtime, requirements of the Fair Labor Standards Act of 1938 (FLSA).

If the proposed rule is a final rule on the date of enactment of S.2707:

  • the Dept of Labor would have been prohibited from enforcing it based on conduct occurring before that enactment date,
  • an employee would not have any right of action against an employer for the employer’s failure to comply with the final rule at any time before that enactment date,
  • any regulations that were amended by the final rule would have been restored and revived as if the final rule had never taken effect, and
  • nothing in S.2707 would have been construed to create a right of action for an employer against an employee for the recoupment of any payments made to the employee before the enactment of this bill that were in compliance with that final rule.

It also specified that the Dept of Labor could promulgate any substantially similar rule only if it had completed certain required actions; but any new rule could not contain any automatic updates to the salary threshold for purposes of exemptions to minimum wage and maximum hour requirements under the FLSA (Fair Labor Standards Act).

The requirement that definitions applicable for such exemptions be defined and delimited from time to time by Labor regulations would have been construed to:

  • require Labor to issue a new rule through notice and comment rule-making for each change in any salary threshold it has proposed (creating more expensive and elongated rule-making processes); and
  • exclude any rule that would result in changes to any salary threshold for multiple time periods, including through any automatic updating procedure.

The Dept of Labor was also prohibited from promulgating any final rule that included any revision to duties tests for exemption from minimum wage and maximum hours requirements unless specific regulatory text for the provision was proposed in the proposed rule.

For clarity, here is the background on that “Final Rule” and what it did for WORKERS:

In 2014, President Obama directed the Department of Labor to update and modernize the regulations governing the exemption of executive, administrative, and professional (“EAP”) employees from the minimum wage and overtime pay protections of the Fair Labor Standards Act (“FLSA” or “Act”). The Department published a notice of proposed rulemaking on July 6, 2015, and received more than 270,000 comments. On May 18, 2016, the Department announced that it will publish a Final Rule to update the regulations. The full text of the Final Rule will be available at the Federal Register Site.

Although the FLSA ensures minimum wage and overtime pay protections for most employees covered by the Act, some workers, including bona fide EAP employees, are exempt from those protections. Since 1940, the Department’s regulations have generally required each of three tests to be met for the FLSA’s EAP exemption to apply:

  1. the employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed (“salary basis test”);
  2. the amount of salary paid must meet a minimum specified amount (“salary level test”); and
  3. the employee’s job duties must primarily involve executive, administrative, or professional duties as defined by the regulations (“duties test”).

The Department last updated these regulations in 2004, when it set the weekly salary level at $455 ($23,660 annually) and made other changes to the regulations, including collapsing the short and long duties tests into a single standard duties test and introducing a new exemption for highly compensated employees.

This Final Rule updates the salary level required for exemption to ensure that the FLSA’s intended overtime protections are fully implemented, and to simplify the identification of overtime-protected employees, thus making the EAP exemption easier for employers and workers to understand and apply. Without intervening action by their employers, it extends the right to overtime pay to an estimated 4.2 million workers who are currently exempt. It also strengthens existing overtime protections for 5.7 million additional white collar salaried workers and 3.2 million salaried blue collar workers whose entitlement to overtime pay will no longer rely on the application of the duties test.

* Key Provisions of the Final Rule *
The Final Rule focused primarily on updating the salary and compensation levels needed for EAP workers to be exempt. Specifically, the Final Rule:

  1. Set the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South, which is $913 per week or $47,476 annually for a full-year worker;
  2. Set the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally, which is $134,004; and
  3. Established a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

Additionally, the Final Rule amended the salary basis test to allow employers to use non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level. The Final Rule made no changes to the duties tests.

Effective Date
The effective date of the Final Rule is December 1, 2016. The initial increases to the standard salary level (from $455 to $913 per week) and HCE total annual compensation requirement (from $100,000 to $134,004 per year) will be effective on that date. Future automatic updates to those thresholds will occur every three years, beginning on January 1, 2020.

Frankly, it wouldn’t surprise me to see Senator Heller espouse and promote a nationwide move such as that just made by the Missouri GOP-led legislature which lowered the minimum wage from $10/hr to $7.70/hr (or, from $20, 800/yr to $16,016/yr for Missouri citizens.

Afterall, Senator Heller has made it exceedingly clear that he represents only his corporate benefactors and is a firm believer and double-downer in a failed trickle-down philosophy.

“Congress is ready to address tax reform, and that’s why I’m encouraged by the President’s comments today about bringing tax relief to all Americans. Nevada’s hardworking families and small business owners have been waiting for a simpler, fairer tax code for years now, and Congress and the White House are poised to make that happen,” Heller said. “I was honored to host Secretary Mnuchin earlier this week in Las Vegas for a meeting with Nevada employers and the message we received from these business leaders was clear – lowering rates will help boost the economy, create jobs and increase wages. As a member of the Senate Finance Committee, I’m looking forward to working with the Administration on this issue and having a seat at the table to make sure that the final product is what’s best for Nevada.”

Mid-term elections matter and we cannot let Dean Heller get re-elected to the Senate, nor can we let AG Laxalt get elected to the Governorship of Nevada.

Related Posts:

An Overdue Fix to Overtime

Businesses are blurring the distinction between hourly and salaried employees in order to bolster their bottom-line profits.
— by

Richard_KirschThere are a lot of ways that businesses are squeezing worker pay. Here’s a big one.

On the one hand, millions of Americans are stuck in low-paying part-time jobs that don’t offer them enough hours.

On the other, millions more are now routinely forced to work over 40 hours a week without getting a dime for their overtime labor. In many cases, that’s because employers are paying hourly wage workers as if they were salaried professionals.

There used to be a big distinction between hourly and salaried employees. That wasn’t by accident.

In 1938, Congress passed the Fair Labor Standards Act, which forced bosses to pay workers a minimum wage and time-and-a-half for any hours worked over 40 a week. That law was key to building America’s middle class.

Only a small percentage of employees — executives, administrators, and travelling salespeople, among others — were exempt from overtime.

Working Overtime
vasilennka/Flickr

 

Yet since figuring out who was eligible for overtime proved complicated, regulators settled on one rule that trumps them all: weekly salary. By having a clear rule on salary level, it’s much harder for employers to avoid paying overtime.

In 1975, for example, employers were required to pay overtime to anyone on a salary of less than $155 a week. That covered 7 out of 10 workers.

But that salary limit hasn’t kept up with inflation or changes in the workforce. As a result, many businesses have been putting anyone with even minor “management” responsibilities on salary.

For example, a federal court found that a clerk at a Dollar General store — who worked 50 hours or more a week stocking shelves and mopping floors — could be considered a salaried “manager,” since she was responsible for minding the store.

Today, if your salary is more than $455 a week — that’s just $23,660 a year — you can be forced to work long hours without any extra pay, let alone time-and-a-half. As a result, instead of 7 of 10 workers being eligible for overtime, now it’s only 1 in 10.

Last March, President Barack Obama told the Department of Labor to modernize the regulation covering who gets overtime. “Because these regulations are outdated,” he acknowledged, “millions of Americans lack the protections of overtime and even the right to the minimum wage.”

To restore this pillar of middle-class income, regulators should once again ensure that 7 out of 10 workers are covered. That’s the best way to close the loopholes that businesses will use to cheat workers out of overtime.

To do that, the Department of Labor should set the new cap to at least $1,327 a week, or $69,000 a year. That level would do what the law was intended to do — namely, to distinguish between workers and bosses.

As a result, 10 million workers would get more money in their wallets to spend boosting the economy in their communities.

In addition to increasing the weekly salary amount, the Labor Department should modernize the rules so that the so-called “managers” at fast food restaurants, clothing outlets, and discount stores — who may be responsible for supervising their co-workers but don’t have any real executive authority — get overtime as well.

Closing the overtime loophole could also increase the earnings of millions of part-time workers. Rather than paying time-and-a-half to employees they’re currently forcing to work unpaid overtime, many businesses are likely to increase the hours worked by part-time employees who are eager to work more.

Overtime pay is key to restarting the middle-class engine of our economy. It’s past time for the Department of Labor to act.

As long as it delays, millions of workers will continue to be cheated by big businesses out of a fair share of the wealth their labor helps to create.


Richard Kirsch is a senior fellow at the Roosevelt Institute and the author of Fighting for Our Health: The Epic Battle to Make Health Care a Right in the United States. He’s also a senior adviser to USAction. USAction.org.  Distributed via OtherWords.org.

GOP Targets Women With Ads For Bill That Would Weaken Overtime Pay

— by Bryce Covert on Apr 30, 2013 at 3:30 pm

In a bid for women’s support and votes, the GOP launched an aggressive ad campaign on “mommy blogs” on Tuesday. The ads will tout its deceptively titled Working Families Flexibility Act that would weaken overtime pay laws:

The banner ads will be featured on over 100 websites popular among women and geo-targeted to be viewed by residents in 20 Democratic-held congressional districts targeted by the GOP for 2014. […]

The $20,000 ad buy, running on sites including Ikeafans.com and MarthaStewart.com through Friday, will call on Democrats to vote with House Republicans next week on a bill to give hourly private sector workers more flexibility to choose between compensatory time and cash payment for overtime work.

“Tell Rep. Kyrsten Sinema you shouldn’t have to choose between work and family,” reads one ad set to run in Sinema’s suburban Phoenix district. “Will Rep. Collin Peterson stand up for working moms?” reads another that’s slated to run in Peterson’s western Minnesota district. The banner ads link to a petition site calling on lawmakers to support “more freedom for working moms.”

There’s no doubt that many Americans are overworked and in need of policies that better allow them to balance their families and their jobs. But the GOP’s solution is not much of a solution at all. Rather than giving workers the ability to accrue paid leave through regular working hours, it would instead allow workers and employers to trade traditional time-and-a-half pay for overtime hours for compensatory time off.

The Fair Labor Standards Act (FLSA) currently requires overtime for work over 40 hours, providing a disincentive to push employees to work long hours, which could diminish if they can offer comp time offered instead. The current law is also already difficult to enforce, as many workers claim they are denied time-and-a-half pay, and some employers may force their employees to use comp time instead. On top of all of this, employers may be able to deny requests to use comp time if they can claim it “unduly disrupts the operations of the employer” or that the request didn’t come in “within a reasonable period.”

There are other policies that Republicans could focus on if they are interested in promoting family friendly work solutions: They could support paid family and medical leave (currently only guaranteed as unpaid leave), paid sick days, and protections for workers who request flexible working conditions.


This material [the article above] was created by the Center for American Progress Action Fund. It was created for the Progress Report, the daily e-mail publication of the Center for American Progress Action Fund. Click here to subscribe.


H.R. 1406: Working Families Flexibility Act of 2013

Sponsor:  Rep. Martha Roby [R-AL2]

4/9/2013–Introduced.

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress.

Working Families Flexibility Act of 2013 –

  1. Amends the Fair Labor Standards Act of 1938 to authorize private employers to provide compensatory time off to private employees at a rate of 1 1/2 hours per hour of employment for which overtime compensation is required.
  2. Authorizes an employer to provide compensatory time only if it is in accordance with an applicable collective bargaining agreement or, in the absence of such an agreement, an agreement between the employer and employee.
  3. Prohibits an employee from accruing more than 160 hours of compensatory time.
  4. Requires an employee’s employer to provide monetary compensation, after the end of a calendar year, for any unused compensatory time off accrued during the preceding year.
  5. Requires an employer to give employees 30-day notice before discontinuing compensatory time off.
  6. Prohibits an employer from intimidating, threatening, or coercing an employee in order to:
    1. interfere with the employee’s right to request or not to request compensatory time off in lieu of payment of monetary overtime compensation, or
    2. require an employee to use such compensatory time.
  7. Makes an employer who violates such requirements liable to the affected employee in the amount of the compensation rate for each hour of compensatory time accrued, plus an additional equal amount as liquidated damages, reduced for each hour of compensatory time used.

Section 5 of this bill specifies that it will “sunset” or in other words, “expire” in a mere 5 years after the date of enactment.  If this is such a great idea, why are they proposing to spend a lot of money to jump through all the administrative hoops, just to do it for a very short period of time?  It’s like a monumental tease, something designed to rope you in, just before they pull the rug out from under your feet.