Department of Labor Rule Change Undermines Overtime Pay Protections

June 12, 2003

The Masters of Deception are at it again. Although Republican leaders in the House were forced to pull their bogus comp time bill (H.R. 1119, the so-called Family Time Flexibility Act) due to a lack of votes, the Bush administration is moving forward with a parallel effort to deny workers overtime pay requirements and other fair labor protections. The administration and their big business friends are trying to institute new labor law regulations under the guise of helping working families.

Please send the Department of Labor your comments, using the message provided below, about this deceptive proposal that would cheat millions of workers. Comments are due June 30, 2003.

According to the DoL's website, the proposed regulations regarding workers covered by the overtime requirement will secure overtime pay for 1.3 million more low-wage workers. Little good this will do if Congress eventually does away with overtime in favor of employer-dictated comp time.

What the DoL's website doesn't tell you is that under that same proposal, more than 640,000 skilled workers will be reclassified as managers, administrative or professional employees, no longer eligible for time-and-a-half wages when they work more than 8 hours a day or 40 hours a week. These workers, who are in aerospace, defense, health care, police, hospitals, retail, high tech and other industries, will lose their overtime protection under the proposed changes to the DoL's job classifications.

Without overtime pay, these workers will have no protection against excessive work hours. This extra cost gives employers a disincentive to disrupt the personal schedules of their workers with unexpected overtime work demands.

At the same time, many workers depend on overtime protections to pay for healthcare, childcare, housing and transportation costs to just name a few. Overtime pay makes up about one-fourth of the average weekly earnings of workers who receive it. The DoL's proposal will make these hundreds of thousands of workers and their families even more economically vulnerable.

And, like all tangled tales, it is the very same white-collar workers who organize, mobilize, demand their rights and file lawsuits who are being moved out of the overtime category. Many of them are plaintiffs in class action lawsuits against employers who have illegally denied them overtime. Even the DoL has alluded to this. Tammy McCutcheon, administrator of the DoL's wage and hour division, recently conceded to the Associated Press that the DOL proposal is intended to result in fewer lawsuits which could mean savings for employers of $1.1 billion to $1.9 billion a year.

The lawsuits McCutcheon referred to are brought not by hourly workers in low-wage jobs, but by low-salaried managers denied overtime. In 2002-2003, current and former managers won several dozen settlements in overtime class action lawsuits against these corporations. Whitehall Jewellers ($620,000), Bank of America ($4.1 million), The Bombay Company ($1.35 million), Starbucks ($18 million), Victoria s Secret ($4.25 million) and Radio Shack ($29.9 million).

Some low-income workers do strike back at corrupt employers with lawsuits. For example, thousands of hourly-wage workers are currently engaging Wal-Mart in 38 lawsuits in 30 states accusing the company of forcing them to work long hours off the clock.

If the DoL really wants to improve labor regulations to make them more supportive of low-income working families, they should incorporate or adopt some of these policies suggested by the Economic Policy Institute:

From now until June 30, the DoL is accepting public comments on the disastrous proposal to cut overtime pay, reduce overtime protections and cut the take-home pay of millions of American workers. Do not remain silent! Join hundreds of thousands of working families across the United States and send your comments to Tammy McCutcheon, administrator of the DoL's wage and hour division.

Comments can also be submitted by mail to:

Your Message:

New Department of Labor overtime proposal offers working families false promises, longer hours and no recourse!

The Department of Labor's proposed changes to the Fair Labor Standards Act cuts off critical overtime pay for hundreds of thousands of working families. Without overtime pay, these workers will have no protection against excessive work hours.

At the same time, many workers depend on overtime protections to pay for healthcare, childcare, rent and transportation costs. Overtime pay makes up about one-fourth of the average weekly earnings of workers who receive it. This legislation would especially hurt women and single heads of household who often count on overtime pay to make ends meet and need control over their time due to daycare and family responsibilities.

Overtime pay is one of those job protections that working families won after decades of struggle to make jobs safe and protect workers from abuse. Please don't take this step backward by cutting overtime pay.