Edwards Denounces New Overtime Rules

[SnyderShrugged]

Edwards Denounces New Overtime Rules

Saturday, August 21, 2004

•Transcript: Edwards Responds to President's Address

WASHINGTON — In blasting new overtime rules that take effect Monday, Democratic vice presidential nominee John Edwards (search) says he can't understand why the Bush administration wants to undermine a system that rewards workers who toil long hours.

"If you work hard, then you should be rewarded for that effort," Edwards said Saturday in the Democrats' weekly radio address. "It is a time-honored tradition. It is what built this country.

"Why would anyone support this new rule which could mean a pay cut for millions of Americans who have already seen their real wages drop again this year?"

Democrats, labor unions and worker advocates tried unsuccessfully to block the new regulations — the first overhaul of government overtime rules in more than 50 years. The liberal Economic Policy Institute in Washington predicts 6 million workers will lose overtime pay, and only a few will get new rights to premium pay after 40 hours.

The administration and business groups counter that the old regulations were outdated and confusing, and were sparking lawsuits against employers by workers challenging their eligibility for the pay.The Labor Department (search) says no more than 107,000 workers will lose overtime eligibility from the changes, but about 1.3 million will gain it.

I don't get why the laft would protest this plan? It seems to match up with their "protect the poor" plans by opening up OT to previously inelligible people. The new elligibility is for low wage earners and it is taking away OT from some who really should be cobsidered salary anyway. I believe this is for those that are over $100,000K per yr.

It seems as if Edwards is simply in campaign mode and will not give merit to any plan from the GOP. It's funny that it violates the Left principles to go against this though.

[Hitman56]

Without knowing what the new rules exactly entail, I'll tell you why the left would be against this. It sounds like another corporate handout. This seems to take money out of the pocket of the workers who do all the actual work in companies and puts it in the pocket of those who are already beyond wealthy.

As for the labor department's estimate: I don't believe anything this administration says anymore.

[SnyderShrugged]

Originally posted by Hitman56

Without knowing what the new rules exactly entail, I'll tell you why the left would be against this. It sounds like another corporate handout. This seems to take money out of the pocket of the workers who do all the actual work in companies and puts it in the pocket of those who are already beyond wealthy.

As for the labor department's estimate: I don't believe anything this administration says anymore.

Interesting note,

On one hand you say that you know nothing about the plan, on the other you claim it sounds like a corporate handout? How can you feel that way without knowing anything specific about it?

So how about you just use the potential model that I listed at the end of the post (notice who I have stated that I believe it to be an approximation of the plan) and base your judgement upon that?

If the OT overhaul is intended to create more OT options for the working poor and those that may lose it are all high income (over 100K without OT included) Then do you still feel that it's a corporate handout? Would you feel that OT is a crucial neccessity for those earning over 100K a year?

What is your rationale for stateing that it's a handout whatsoever?

If you feel that it's still somehow a handout, how would you differentiate it from the way OT is handled today?

I look forward to your response, and if you happen to come accross any of the plan specifics (I'm looking too, all I have heard so far was verbal on the networks) please poist them so we all can have an educational debate based on facts and not assumption.

Thanks!

[SnyderShrugged]

According to many links that I have viewed, the new plan and it's specifics has few holes in it that can be argued against. Notice that edwards never went into any detail as to how this would be bad, only that it was bad.

This one seemed to be the most comprehemsive in explanation of the plan.

http://www.heritage.org/Research/Labor/wm535.cfm

New Overtime Regulations: Modernizing Outdated Rules or Eroding Worker Protections?

by Kirk A. Johnson, Ph.D., and Paul Kersey

WebMemo #535

July 14, 2004 | printer-friendly format |

The Economic Policy Institute (EPI) has released a report[1] on the final overtime rules published by the U.S. Department of Labor (DoL) last April[2]. EPI has argued before that, if adopted, these overtime regulations would mean “lower pay [and] longer hours for millions of workers”[3]. These charges are simply untrue. The new regulation will, in fact, improve overtime protections for employees.

The current regulation is antiquated.

Before a worker may be considered exempt for overtime, there are three tests that must be met. First, the “salary-basis” test specifies that a worker must be paid on a set salary; hourly employees who work more than 40 hours in a given work week are generally eligible for overtime. Second, the “salary-level” test determines that any worker who earns less than a certain salary is automatically eligible for overtime, regardless of his or her job. Finally, a “duties test” allows certain executive, administrative, and professional employees to be exempt from overtime based on the kind of work they do.

The salary test has not been updated in nearly 30 years, and the duties test has gone even longer without any significant changes. One consequence of the lack of updated rules is that the minimum salary needed for a worker to be exempted from overtime is an absurdly low $155 per work week. The new regulation would raise the salary test to $455 per work week: any worker paid less than $455 per work week (or $23,660 per year) would automatically receive overtime protection, regardless of job duties.

The new rules mainly simplify the duties tests, but make few substantive changes.

Under the current rules, there are both short duties tests and long duties tests to determine whether or not an employee is exempt from overtime. Which test is administered depends on the employee’s salary level. But because of the failure to update the regulation, the long test has become irrelevant and the “short test” applies to all workers earning more than $13,000 per year. Under the new final rules, a single “standard test” for each occupational category (administrative, executive, and professional employees) replaces all of the old tests.

The new rules are particularly valuable for low-level supervisors. Under the current “short test,” an “assistant manager” who regularly supervises two other employees could be designated exempt from overtime. Under the new rules, supervisors must have the authority to hire and fire, or their suggestions in that arena must be given “particular weight” in addition to the other managerial duties. This is a significant tightening of the executive duties test that will result in fewer exemptions.

Similarly, for administrative and other office employees, employers will find it more difficult to deny overtime under the new rules. The regulation dictates that the employee, as part of his or her job duties, must exercise “discretion and independent judgment with respect to matters of significance.”

The new duties test for professional employees will have little, if any, effect on who receives overtime. The current rules state that the primary duty of a professional is “work requiring knowledge of an advanced type” that is “customarily acquired by a prolonged course of specialized intellectual instruction and study,” which is the same language used in the new rule. Both the old rule and the new rule make a narrow exception for cases where substantial experience exists, such as an attorney who did not attend law school. That type of worker may still be considered a professional.

The new regulation means more employees will be eligible for overtime, not fewer.

In their new study, EPI would have policymakers believe that some 6 million white-collar employees would lose overtime protection were the new overtime regulation adopted. This is based on the flawed premise that many hourly workers would be converted to a salary-basis and denied overtime. Because the overtime rules are either the same or change so minimally, employers who would be inclined to attempt this would have already done so.

According to a forthcoming analysis by The Heritage Foundation, nearly 1.3 million currently exempted workers who earn between $155 and $455 per week would receive overtime protection under the new regulation that they do not enjoy now. Because the new regulation makes it more difficult to exempt administrative and executive employees, more workers would be eligible for overtime protections.

The only workers who may lose overtime protections because of the new regulation are certain individuals earning more than $100,000 per year. Most of these workers are executives or professionals who are not eligible for overtime, anyway. Even if all of these highly paid employees lost their overtime protection—which is unlikely—only about 272,000 workers would lose overtime, according to this same Heritage study. A more reasonable estimate would be that around 100,000 highly compensated workers may lose their overtime.

Conclusion

The new overtime regulation is a welcome modernization from the outdated rules that employers must currently use. Contrary to the Economic Policy Institute’s assertions, the new regulation would ensure that more employees enjoy overtime protections, not fewer.

Kirk A. Johnson, Ph.D., is Senior Policy Analyst in the Center for Data Analysis, and Paul Kersey is Bradley Visiting Fellow in Labor Policy, at The Heritage Foundation.

[Thiebear]

This looks to be an update to the old system and not bad on that definition.

This is that triagulation attempt again.. If Edwards proposed this he'd be dancing around the ring with gold gloves one... It would have been a dream accomplishment..

I work 50+ hours a week and I'm on call 365 days a year so Its time to start digging and see if anything applies......

[SnyderShrugged]

I noticed a defitite lack in responses from those with a ceratain political affiliation?

hmmm

[Nerm]

Originally posted by skin-n-vegas

Interesting note,

On one hand you say that you know nothing about the plan, on the other you claim it sounds like a corporate handout? How can you feel that way without knowing anything specific about it?

So how about you just use the potential model that I listed at the end of the post (notice who I have stated that I believe it to be an approximation of the plan) and base your judgement upon that?

If the OT overhaul is intended to create more OT options for the working poor and those that may lose it are all high income (over 100K without OT included) Then do you still feel that it's a corporate handout? Would you feel that OT is a crucial neccessity for those earning over 100K a year?

What is your rationale for stateing that it's a handout whatsoever?

If you feel that it's still somehow a handout, how would you differentiate it from the way OT is handled today?

I look forward to your response, and if you happen to come accross any of the plan specifics (I'm looking too, all I have heard so far was verbal on the networks) please poist them so we all can have an educational debate based on facts and not assumption.

Thanks!

I am always amazed by the position that... If people are allowed to keep the money they earn, it is a "corporate handout". I think that says a lot about the world view of the person making the charge. It seems to suggest that all money earned is the property of the government and the govt should decide how much everybody gets.

Dont get me wrong, I understand the the govt does "give away" a lot of money to big buisness, but I don't see tax cuts and employment rule changes as corporate handouts.

[The Sisko]

This is a horrible idea. I work in healthcare with a lot of folks that do a lot of overtime. Our employer has said that after analyzing the situation they will continue to pay overtime even though they don't have to....translation "We know that if we don't pay you overtime we'll have to pay more for contract/agency staff."

Sorry, but it's a really bad idea, especially if you're a teacher.

I was on the fence about voting for "W" again. This may have tipped me over the other way. That would really suck since I haven't voted for a Demon-crat since Mondale (yeah, I know, no comment:rolleyes: )

As much as our economy is driven by consumer spending this is just a horrible idea all around. I think "W" has really screwed the pooch on this one.

http://www.csmonitor.com/2004/0726/p17s01-cogn.html

http://www.epinet.org/content.cfm/webfeatures_viewpoints_final_overtime_regulations

[Thiebear]

Originally posted by Yusuf06

This is a horrible idea. I work in healthcare with a lot of folks that do a lot of overtime. Our employer has said that after analyzing the situation they will continue to pay overtime even though they don't have to....translation "We know that if we don't pay you overtime we'll have to pay more for contract/agency staff."

Sorry, but it's a really bad idea, especially if you're a teacher.

I was on the fence about voting for "W" again. This may have tipped me over the other way. That would really suck since I haven't voted for a Demon-crat since Mondale (yeah, I know, no comment:rolleyes: )

As much as our economy is driven by consumer spending this is just a horrible idea all around. I think "W" has really screwed the pooch on this one.

http://www.csmonitor.com/2004/0726/p17s01-cogn.html

http://www.epinet.org/content.cfm/webfeatures_viewpoints_final_overtime_regulations

Only if your a Resident making over 100k

Only if your a teacher making over 100k

Only if your a Cop making over 100k

If your making less than 24k you get overtime automatically....

if your a Network Tech like me ... thats not making over 100k but told even if I would 110 hrs I dont get overtime.... may start getting it (hopefully)...

I think you got this one backwards....

The above states Over 100k (no overtime)

If your in charge of 2 or more but not hire and fire your get overtime.. (clogged that loophole)...

If your making a regular worker you get overtime...

Is that right?

[maxpower]

Bush's changes to overtime regulations do NOT only effect those who make more than 100k. While the new rules will make a little over a million workers eligible for overtime who were not before, the rule changes will allow for employers to NOT pay overtime to some 6 million workers, many of them making significantly less than 100k.

Workers making less than 100k but more than 23,000k could be screwed out of overtime pay due to changes in the rules that allow employers to re-catagorize some employees as managerial, including some cops, teachers and nurses, and thus ineligible for overtime pay. Many of the workers who could be re-classified are in no way managers, but Bush's rule changes are very beneficial to employers who will be able to NOT have to pay overtime to workers who should be recieving it.

Yes, the new overtime rules will make some workers ineligible who do not necessarily need overtime pay. However, if you look at the studies, the number of workers making over 100k who will become ineligible are very small compared to the number of workers who make under 50,000k who could lose out on overtime pay.

The point is, these new rules hurt more workers than it helps.

Can anybody out there argue with a straight face that we should expect anything else from this administration?

[Thiebear]

Originally posted by maxpower

Bush's changes to overtime regulations do NOT only effect those who make more than 100k. While the new rules will make a little over a million workers eligible for overtime who were not before, the rule changes will allow for employers to NOT pay overtime to some 6 million workers, many of them making significantly less than 100k.

Workers making less than 100k but more than 23,000k could be screwed out of overtime pay due to changes in the rules that allow employers to re-catagorize some employees as managerial, including some cops, teachers and nurses, and thus ineligible for overtime pay. Many of the workers who could be re-classified are in no way managers, but Bush's rule changes are very beneficial to employers who will be able to NOT have to pay overtime to workers who should be recieving it.

Yes, the new overtime rules will make some workers ineligible who do not necessarily need overtime pay. However, if you look at the studies, the number of workers making over 100k who will become ineligible are very small compared to the number of workers who make under 50,000k who could lose out on overtime pay.

The point is, these new rules hurt more workers than it helps.

Can anybody out there argue with a straight face that we should expect anything else from this administration?

Give me an example: I never heard of a cop or a teacher that had hire or fire ability over 2 or more others?

The rule actually closes the rule from before that said if you were a manager in title only you didnt get the overtime.. This makes it so you are a real manager with hire and fire or your getting overtime.. not a manager in title only.

[maxpower]

Thiebear: I'm interested in where you heard about the necessity of having the authority to hire/fire for an employee to be considered managerial.

Everything that I have seen indicates that an employee only needs to have directing authority over 2 employees to be classified as a manager.

This is the example that I have seen written about the most: a wal-mart employee is givin authority to direct the actions of two other employees, say folding clothes. This employee then could be classified a manager, even though he/she does not have to be fulltime, does not have to spend a good amount of time managing, does not have the authority to hire/fire.

So we're talking about someone who makes minimum wage, who is given directing authority over two other employees making minimum wage.

Again, I have not heard about this hire/fire clause. I'd like to know where you got this from.

[SkinFaninOKC]

Overtime rules don't mean jack at my work. My bosses rarely give overtime at all so the rules don't matter. Alot of times someone will work a 6 day work week and receive only 40 hours. That is because a couple of the days are shortened to 4 hours shifts.

My bosses have a budget to watch.

[Thiebear]

Originally posted by maxpower

Thiebear: I'm interested in where you heard about the necessity of having the authority to hire/fire for an employee to be considered managerial.

Everything that I have seen indicates that an employee only needs to have directing authority over 2 employees to be classified as a manager.

This is the example that I have seen written about the most: a wal-mart employee is givin authority to direct the actions of two other employees, say folding clothes. This employee then could be classified a manager, even though he/she does not have to be fulltime, does not have to spend a good amount of time managing, does not have the authority to hire/fire.

So we're talking about someone who makes minimum wage, who is given directing authority over two other employees making minimum wage.

Again, I have not heard about this hire/fire clause. I'd like to know where you got this from.

Its above....

The new rules are particularly valuable for low-level supervisors. Under the current “short test,” an “assistant manager” who regularly supervises two other employees could be designated exempt from overtime. Under the new rules, supervisors must have the authority to hire and fire, or their suggestions in that arena must be given “particular weight” in addition to the other managerial duties. This is a significant tightening of the executive duties test that will result in fewer exemptions.

looks like i was wrong about teachers and me though

from the Washington Post:

The regulations do not apply to workers represented by union contracts or to teachers, skilled computer professionals, farm workers or commissioned sales people.

[gbear]

http://www.cnn.com/2004/US/08/22/overtime.pay.ap/index.html

WASHINGTON (AP) -- Paychecks could surge or shrink for a few or for millions of workers across the country starting Monday, when sweeping changes to the nation's overtime pay rules take effect.

There is little agreement by the Bush administration, employer groups, labor experts and others on how many workers will gain or lose the right to overtime pay under the new rules in the Fair Labor Standards Act.

"To be candid, no one knows," said Jerry Hunter, a labor lawyer at Bryan Cave LLP in St. Louis and former general counsel of the National Labor Relations Board during the first Bush administration.

Employers have sought changes for decades, complaining the regulations were ambiguous and out of date, and questioning why highly paid professionals should get overtime pay. Labor unions, however, say the new rules are intended to reduce employers' costs by cutting the number of workers who are eligible for overtime pay.

Estimates of how many workers will lose their overtime eligibility range from 107,000 to 6 million. Workers who could become newly eligible range from very few to 1.3 million.

"Not only is the Labor Department unsure, but a lot of people in a lot of industries are unsure," Hunter said. "This is all very fluid right now."

The major overhaul, the first in more than half a century, is aimed at mostly white-collar workers. The Labor Department says manual laborers and other blue-collar workers will not be affected.

The new rules are intended to limit workers' multimillion-dollar lawsuits, many of them successful, claiming they were cheated out of overtime pay for working more than 40 hours a week.

Retailers, restaurants, insurance firms and banks have been targets, and jobs in those places are generally exempted from overtime in the new rules. They include chefs, pharmacists, funeral directors, embalmers, journalists, insurance claims adjusters, low- and midlevel bank managers and dental hygienists.

Whether the new rules will reduce litigation is questionable, experts said. Lawyers representing workers have found the suits lucrative.

"This has become a very big area of plaintiffs' employment law, and it is not simply going to go away because of these new regulations," said Bill Schurgin, a labor lawyer in the Chicago office of Seyfarth Shaw.

Critics say the changes will eliminate overtime for millions of middle-class Americans struggling in a weak jobs market.

"These are drastic changes that will hurt working families," said Karen Nussbaum, executive director of Working America, an AFL-CIO organization created for workers unable to join unions. The AFL-CIO is holding a protest outside the Labor Department on Monday.

Labor Secretary Elaine Chao has created a task force that will be "looking very closely and critically at any reclassifications that result in workers losing their overtime status," said Steven Law, deputy secretary.

No new funds have been added, but the department's Wage and Hour Division "will be very, very carefully monitoring and following up with enforcement," especially in high-violation industries, he said. The department won $212 million in back wages for overtime violations in 2003, a 21 percent increase.

At Denver Water, a public utility, none of the 1,050 employees will be reclassified, said benefits manager Jim Crockett.

"We were in compliance before, and when I analyzed the jobs for the new rules, it came up that no changes were necessary," he said.

When in doubt, the utility classifies workers as overtime-eligible, Crockett said. For example, its survey chiefs are in the field only during summer months supervising crews; the rest of the year they oversee few workers, if any. But the chiefs are given overtime status, he said.

About 107,000 white-collar workers now eligible for overtime pay who earn $100,000 or more annually could lose it under the new rules, the Labor Department said.

About 1.3 million workers, mostly low- and midlevel managers at stores and restaurants, who earn less than $23,660 a year will be newly eligible. However, employers can avoid paying them overtime by raising their salaries, so critics say far fewer will benefit from overtime.

For white-collar workers who fall between those salary levels, their overtime status depends on their job duties and experience. The rules revamp the definitions of professional, administrative and executive employees, called "duties tests," that are used to determine eligibility.

For example, professional employees exempt from overtime had professional degrees. The new rule allows employers to substitute work experience and instruction.

Executive employees had authority to hire and fire. The new rule expands that provision, saying an executive can make recommendations that carry weight regarding employment status.

Labor leaders say slight changes in wording could exempt millions from overtime pay. The Labor Department says duties are more clear and make status more certain, resulting in "few, if any" losing overtime.

The changes will prompt "a whole new round of litigation to determine what these phrases mean," said Baldwin Robertson, a Washington labor lawyer hired by Working America to answer workers' questions on its Web site.

-----------------------

Note: Retailers, restaurants, insurance firms and banks are all exempted from the new rules. THey don't have to pay overtime?There's your corporate handout if that's true.

Also "professional" used to require professional degrees to be exempted from overtime. Now work experience can be substituted. So once you've been at your job for a while, they can require overtime wihtout paying for it. Nice.

[maxpower]

Thiebear: From WashPost above:

"Executive employees had authority to hire and fire. The new rule expands that provision, saying an executive can make recommendations that carry weight regarding employment status."

As you see from the WashPost article, no one seems to really understand the end result these rules will have.

The question is, do we have any reason to believe that the Bush administration wrote these rules to benefit working Americans?