(no subject)

For all those of you out there who've seen the occasionally panicky postings of Seattlites about all the snow, here's a picture for you- of what half a foot of snow looks like here:

Click the picture if, for some reason, you want a larger version of my foot.

And now for something completely different: Happy birthday to rowanf, and a somewhat belated one to jmkelly.

Labor Department Encourages Employers to Screw Employees Out of Overtime Pay

From the Associated Press and today's Seattle Times. Article link

Employers get tips to avoid overtime pay

By Leigh Strope
The Associated Press

WASHINGTON — A proposed Labor Department rule suggests ways employers can avoid paying overtime to some of the 1.3 million low-income workers who would become eligible this year.

The department's advice comes even as it touts the $895 million in increased wages that it says those workers would be guaranteed from the reforms.

Among the options for employers: cut workers' hourly wages and add the overtime to equal the original salary, or raise salaries to the new $22,100 annual threshold, making them ineligible.

The department says it is merely listing well-known choices available to employers, even under current law.

"Payroll adjustment"


The Labor Department is suggesting ways employers can avoid paying overtime to newly eligible workers in its proposal. It offered this example of a "payroll adjustment":

• A worker earning $400 per week for 40 hours becomes eligible for overtime pay, which would average five hours a week.

• The employer can convert the worker to an hourly pay rate. But instead of paying him $10 an hour plus overtime, the employer can cut the worker's pay to $8.42 an hour, or $336.80, for a 40-hour week.

• The five hours of overtime pay at time-and-a-half — totaling $63.15 — get added to the reduced pay.

• The new pay with overtime equals $399.95 per week, compared with the old salary of $400 per week with no overtime.

This "payroll adjustment option ... could offset the impact of the proposed rule," the department said.

Source: Labor Department's proposal to revise overtime pay rules, published March 31, 2003, in the Federal Register.

"We're not saying anybody should do any of this," said Labor Department spokesman Ed Frank.

New overtime regulations were proposed in March after employers complained they were being saddled with costly lawsuits filed by workers who claimed they were unfairly being denied overtime. But the regulations themselves have stirred controversy over how many workers would be stripped of their right to overtime pay.

The issue is being seized upon by Democrats in their attempt to win back Congress and the White House.

A final rule, revising the 1938 Fair Labor Standards Act, is expected to be issued in March. The act defines the types of jobs that qualify workers for time-and-a-half if they work more than 40 hours a week.

Overtime pay for the 1.3 million low-income workers has been a selling tool for the Bush administration in trying to ease concerns in Congress about millions of higher-paid workers becoming ineligible.

But the Labor Department, in a summary of its plan published last March, suggests how employers can avoid paying overtime to those newly eligible low-income workers.

"Most employers affected by the proposed rule would be expected to choose the most cost-effective compensation adjustment method," the department said. For some companies, the financial impact could be "near zero," it said.

Employers' options include:

• Adhering to a 40-hour work week.

• Raising workers' salaries to a new $22,100 annual threshold, making them ineligible for overtime pay.

If employers raise a worker's salary, "it means they're getting a raise — that's not a way around overtime," Frank said. The current threshold is $8,060 per year.

• Making a "payroll adjustment" that results "in virtually no, or only a minimal increase in labor costs," the department said. Workers' annual pay would be converted to an hourly rate and cut, with overtime added in to equal the former salary.

Essentially, employees would be working more hours for the same pay.

The department does not view the "payroll adjustment" option as a pay cut. Rather, it allows the employer to "maintain the pay at the current level" with the new overtime requirements, said the Labor Department's Wage and Hour Division administrator, Tammy McCutchen, an architect of the plan.

Mark Wilson, a lawyer for the Communications Workers of America who specializes in overtime issues, said the Bush administration was protecting the interests of employers at the expense of workers.

"This plan speaks volumes about the real motives of this so-called family-friendly administration," Wilson said.

He says cutting workers' pay to avoid overtime is illegal, based on a 1945 Supreme Court ruling and a 1986 memo by the Labor Department under President Reagan.

McCutchen said if changes were made week to week to avoid overtime, they would be illegal, but that a one-time change is not.

"We had a lot of lawyers look at this rule. We would not have put that in there if we thought it was illegal," she said. "Unless you have a contract, there is no legal rule ... prohibiting an employer from either raising your salary or cutting your salary."