Library
     
 

November 24, 2003

 

Happy Thanksgiving!

 

All of us at Astron Solutions wish you a Happy Thanksgiving!

Enjoy the day and the tasty meal. Don't forget to give thanks for all that's important in your life - family, friends, a job, a warm and safe home.

We're thankful you're a part of our family!


 

The Astron Road Show

 

If you are going to be in New York City on December 4, you have two opportunities to meet with the Astron Solutions team!

Jennifer Loftus, National Director, will present to the Business Council of New York State's Labor and HR Committee. Jennifer will speak on current trends in compensation. To learn more about the meeting, contact Janet Carroll at 518-465-7511 x217.

Also on December 4, Gabriel Squailia, Astron's Research Librarian, will make his trade show debut! Gabriel will be meeting and greeting attendees at the AHHRA annual full-day conference. AHHRA is the New York City chapter of ASHHRA. Jennifer will also be at the conference, so be sure to stop by and say hello!


 

 

Call for Presentations

 

Would you like a copy of Jennifer's December 4th presentation?

How about a copy of "Workforce Culture: New Orleans Style," presented by National Director Michael Maciekowich on November 13th at the Metropolitan Hospital Council of New Orleans' full-day conference?

To receive copies of either or both of these presentations, click here to contact Gabriel Squailia.


 

 

Are My Non-Exempt Positions Still Non-Exempt? Proposed FLSA Changes You Need to Know

 

In March of 2003, the Department of Labor's Wage and Hour Division proposed extensive changes to the long-outdated Fair Labor Standards Act (FLSA). While the current standards' confusing overtime exemption test is hardly beloved in the HR community, the prospect of far-reaching changes has caused some trepidation. In this Astronology, we offer insight into the proposed changes and an update on the legal battle surrounding this issue.

The proposed changes comprise nearly forty pages of revisions and updates. Here are some highlights, with an emphasis on major differences in criteria and tests for determining exempt / non-exempt status.
  • Employees earning less than $425 per week, or $22,100 per year, would automatically be non-exempt (eligible for overtime). The current standard is $155 per week, significantly less than the federal minimum wage.
  • The "short" and "long" exemption tests would be abolished, in favor of a "standard duties test" providing criteria for each exemption category.
  • Employees earning between $22,100 and $65,000 per year would be considered exempt if they perform the duties summarized in one of the employee categories below:
    • Executive:
      1. Manage the enterprise, or a department / subdivision thereof.
      2. Manage two or more employees.
      3. Hire, fire, or advise on such status changes.
    • Administrative:
      1. Perform non-manual work related to management or general business of the employer or its customers.
      2. Hold a "position of responsibility," performing "work of substantial importance or requiring a high level of skill or training."
    • Learned professional: Perform non-manual work requiring advanced learning. Technical training, on-the-job experience, and other means of acquiring knowledge would be recognized, as well as traditional higher education.
  • Employees earning more than $65,000 per year and performing one of the executive, administrative, or professional duties described above would be automatically exempt.
  • The test of "discretion and independent judgment" would be eliminated, and replaced in the administrative test with the aforementioned "position of responsibility" criterion.
  • Exempt employees could receive disciplinary suspensions, with pay docking, for periods of one day or more.
Once the proposed changes were released, the battle lines were quickly drawn. In the broadest terms, business groups and Republicans in Congress are for the changes (though often with suggested modifications), while unions and Democrats have sided against them. Strong opinions and wildly varying predictions have made this a dizzying debate.

The nonpartisan Economic Policy Institute claims that the changes would cause up to eight million workers to lose their overtime qualifications. The nonpartisan Employment Policy Foundation, on the other hand, claims that the proposed changes would extend non-exempt status to 3.4 million workers, and that none would lose overtime rights. The Department of Labor claims that the regulations would add 1.3 million workers to the non-exempt category. The DOL agrees that some workers would lose their non-exempt status, but cites the number at 644,000.

To further complicate matters, the Senate recently passed an amendment, sponsored by Sen. Tom Harkin (D-Iowa), which would deny Labor Department funding for regulations that would cause any non-exempt employees to be reclassified as exempt. The Harkin amendment is attached to a wider appropriations bill, which President Bush has threatened to veto if it is passed with the Harkin amendment intact.

On November 18, the AFL-CIO issued a letter stating that "[t]he purpose of the Harkin amendment is not to stop DOL from updating or clarifying the overtime eligibility rules, but rather to establish common sense ground rules for DOL's rulemaking."

According to the Daily Labor Report on November 19, House Appropriations Committee Chairman C.W. Bill Young (R-Fla) said the DOL proposal has postponed a conference report for weeks. "That is a show-stopper," said Young. "Somebody with jurisdiction has to make a decision [on handling the Harkin amendment.]"

Many labor organizations are claiming that the proposed changes will automatically change the FLSA status of registered nurse from non-exempt to exempt, thus depriving nurses their overtime pay. While the proposed guidelines would lead to this conclusion, the market has and will continue to be the primary influence in paying registered nurses overtime. In fact, under the current regulations it is possible to exempt registered nurses, but because of market conditions and labor shortages hospitals have chosen to track hours and pay overtime, a key in determining FLSA status. The same can be said for many other professions.

Be sure to keep an eye on the news for the conclusion to this saga, which may yet have far-reaching implications for the HR profession.


Reader Poll Archive
Wonder what your fellow readers think about critical HR topics? Is your organization unique from or similar to others?
Click here to view the results of our past polls!


Have a Question?
If you have a topic you would like addressed in Astronology, or some feedback on a past article, don't hesitate to tell us! Simply reply to this e-mail. See your question answered, or comments addressed, in an upcoming issue of Astronology.

Looking for a top-notch presenter for your human resource organization's meeting? Both Jennifer Loftus and Michael Maciekowich present highly-rated sessions on a variety of compensation and employee retention issues. For more information, send an e-mail to info@astronsolutions.com.

Are you reading a pass-along copy of Astronology? Click on this button to start your own subscription today!

Send inquiries to info@astronsolutions.com or call 800-520-3889, x105.


The Fine Print
We hold your e-mail address in trust. Astron Solutions promises never to share or rent your personal information. We also promise never to send you frivolous e-mails and will allow you to leave our list, at your option, at any time.

To remove yourself from this list, please follow your personalized subscriber link at the bottom of your Astronology alert e-mail.

Copyright 2007, Astron Solutions, LLC

ISSN Number 1549-0467