Tuesday, September 2, 2003

Overtime showdown draws near


Congress ready to act on revamping labor law

By John Eckberg
The Cincinnati Enquirer

Overtime pay could soon go the way of the office typewriter.

A new set of workplace rules that revise the Depression-era federal law on overtime is headed for a Capitol Hill showdown as soon as Wednesday.

At issue, besides the need for the rule, is precisely how many people it would affect.

Proponents of the change say it would take overtime from hundreds of thousands of American workers, while making 1.3 million low-wage workers eligible for it. Opponents say the number who would lose overtime is as high as 8 million.

Opponents have mailed a flotilla of material, claiming a revamped Fair Labor Standards Act would unfairly wipe out overtime for people employed in a spectrum of professions and crafts.

But the Bush administration adamantly rejects suggestions that the proposal would end overtime protections for occupations such as licensed practical nurses, restaurant chefs, police sergeants, paramedics and paralegals.

The rules propose to eliminate overtime for people who:

• Supervise two or more employees.

• Have the power to hire/fire.

• Hold "a position of responsibility."

It would extend overtime to people whose weekly wages are under $425. In the past, that ceiling was $155.

Leading the opposition are labor leaders, who insist rank-and-file workers would be irrevocably harmed.

But it also has found opposition from some who are not affiliated with a labor union.

"They are talking about putting money back in the pockets of people who need it least and denying it to people who need it most," said Jim Briscoe, a 40-year-old Milford resident.

Briscoe, who manages a hotel restaurant in Blue Ash, said there is no mystery why companies want the rule changes to apply to lower-wage workers, particularly now during what some claim is the worst hiring climate since the Great Depression.

When companies consider downsizing, he said, there is a budget safety net implicit in offering overtime to a handful of workers who are not at the top end of the salary scale.

"It's cheaper to have one guy and pay him overtime than hire two and pay them each a salary for a 40-hour week," Briscoe said.

Briscoe said that he would probably be hurt by anything that limits overtime, although overtime is not something he regularly receives, even though he is eligible. He rarely files for overtime because his company discourages it, he said.

What many people fail to realize is that there are plenty of workers who are already having trouble making ends meet, Briscoe said. "Lots of people have two jobs where I work," he said. "They have to have two jobs to survive."

Backers of the revision contend that only midlevel white-collar employees such as sales executives and supervisors - people who should not be getting overtime anyhow because they are in clear positions of authority - will be denied it if Congress allows the measure to become law sometime in 2004.

The goal is to restore clarity to the labor law and reduce the likelihood of litigation, said Michael J. Eastman, director of labor law policy at the U.S. Chamber of Commerce.

Chamber leaders point out that the U.S. General Accounting Office, the investigative arm of Congress, urged the Labor Department to update the regulations in 1999.

The challenge for many companies has been to interpret confusing regulations that were written to cover factory workers: For instance, how can a financial services firm determine who is and who is not a production worker?

"What's happened is that rules for manufacturing have been analogized to the service industry sector," Eastman said. "It's easy to determine who is a production worker in a widget factory; but for a loan officer, that's not an appropriate test."

The Greater Cincinnati Chamber of Commerce has not taken a position on the proposed revisions, said Doug Moormann, vice president/government affairs.

"It's not an issue that has come before our board. Certainly, this law is one that was enacted in 1930s, and we do believe laws need to keep pace with the changing nature of business and the changing nature of our economy," he said.

Doug Shelton, a Procter & Gamble Co. spokesman, said the company thinks some changes are in order.

"We think a review of the law is sensible and support a revision of the 1938 Fair Labor Standards Act. The workplace is very different from when the law was enacted."

Cincinnati firefighters probably have nothing to worry about from the proposal, said Joseph Arnold, vice president of Cincinnati Fire Fighters Union Local 48. The local has 810 people in the bargaining unit and 730 dues-paying members.

Because firefighters are covered by a collective bargaining agreement, that pact will take precedence over federal law, Arnold said.

"They're changing the rules, the definition of supervisor," he said. "If it goes through as drafted, it will adversely impact a large number of working families."

V. Daniel Radford, executive secretary of the Cincinnati AFL-CIO Labor Council, representing 90,000 worker families in Greater Cincinnati, said unions are going to the mat on this one.

"It's an all-out campaign," he said. "For some, overtime represents 5 or 6 percent of total income. Losing it will be a major financial problem, especially for families trying to make ends meet."

Labor unions also worry that any revision will weaken protection for all working Americans - not just union members, said Richard Hurd, professor of labor studies at the School of Industrial and Labor Relations at Cornell University in Ithaca, N.Y.

The measure allows employers to categorize more employees as exempt from overtime, he said.

"That creates a potential for abuse," he said. "Unions worry that workers will continue to work the same number of hours, but they'll be paid less because they no longer qualify for overtime."

Ross E. Eisenbrey, vice president and policy director of the Economic Policy Institute, a Washington think tank specializing in labor market policies, is convinced federal officials are attempting to manipulate workplace regulations to reduce the payroll for employers.

Eisenbrey also objects to the way the measure has worked its way through the federal bureaucracy.

For instance, no public hearings have been held. And while the federal government has received more than 76,000 comments from companies and associations, those remarks have been kept out of the public eye.

"If you work for a company like Boeing, say, you might want to know what Boeing says," Eisenbrey says. "But you can't find out unless you come to Washington, get an appointment to view the records, go into a little room and look for the comments in a ring binder.

"And then there's no alphabetical index. Instead, you have to leaf through all the comments until you maybe find what you're looking for."

Almost 52,000 of the comments, however, came from union members - who used the same form letter.

One Greater Cincinnati resident who commented was James Langendorf, a lawyer from Middletown who represents workers in civil-rights and wage claims. He suggested the regulation would undermine the tax cuts President Bush recently signed into law.

"It is my understanding that 25 percent of the average hourly workers' pay is overtime," Langendorf wrote. "How on earth will the economy be better served by reducing the take-home pay of 8 million hourly workers?"

---

Gannett News Service contributed to this report. E-mail jeckberg@enquirer.com




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