(The Return of) Ignatz, by Sam Heldman

Tuesday, December 17, 2002

There is an interesting article this morning in law.com about an effort to revise the regulations under the Fair Labor Standards Act regarding the categories of employees who are exempt from the Act's requirement of overtime compensation.

Hold on -- that sounds boring, when you write it like that. But it's very important. I will try again:

If you are, or if you have friends or family members who are, "management" at a big chain store or restaurant, then you know what's going on. In exchange for the title and a little bit of authority, and the glory of being able to say that you are such a bigwig that you are paid a salary rather than an hourly wage, you get hosed: you are made to work so many hours that if you sat down and tried to calculate what your effective hourly rate would be (if you were paid x for the first 40 hours and 1.5 times x for the remainder) you'd find that you're making an "x" that doesn't seem worth it at all. This happens, of course, not just in retail and food service, but in just about all industries as to some job classification or another.

There are regulations defining what sort of job you have to have -- what kind of duties, and level of pay -- before a company can pull that trick on you (if you don't agree with my politics, delete "pull that trick on you" and insert "freely negotiate such an arrangement with you"). Employers hate the complexity and perceived ambiguity of those regulations, and somehow can't bring themselves to what seems to me to be the obvious solution: when in doubt as to whether you can lawfully pull this trick on an employee, don't. Employee representatives, on the other hand, hate the fact that the minimum-salary part of the test -- the amount of salary you have to be paid, at least, in order to allow this trick -- hasn't risen for decades.

The outcome of this battle, if there is an outcome, will be important.

posted by sam 7:15 AM 0 comments


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