Final FLSA Rules to be Handed Down in March

January 2, 2004 ( - Despite opposition from both the United States House and Senate, a final rule changing the Fair Labor Standards Act's (FLSA) overtime provisions should be issued by the US Labor Department by the end of March, stated an agency regulatory plan published last week.

>Final regulations have not yet been decided but, the Washington Post reported that Victoria Lipnic, assistant secretary of labor for employment standards, hinted the rules may be modified somewhat to reflect concerns raised by critics, although she has not given specifics.

>The proposed changes would end mandatory overtime pay for many workers who qualify now, while including others who don’t qualify for any overtime pay currently.   In 2002, approximately 11 million workers received overtime pay, and critics say that proposed changes could result in nearly 8 million American workers no longer being eligible for time-and-a-half pay if they work more than 40 hours in a week.

>However, labor officials say that 644,000 workers could lose their overtime pay because of how their jobs are defined, according to the Post.   Additionally, through updating wage levels, the Labor Department contends that the rules could make 1.3 million low-wage workers eligible for overtime pay, who weren’t before.   The new rules would raise the current cap of $8,060 to become automatically eligible for overtime to a cap of $22,100.

>Included in the new rules is a provision that gives the opportunity for employers to designate workers as those holding “a position of responsibility” and making them exempt from overtime pay.   Additionally, under the new regulations, those workers earning more than $65,000 a year could lose overtime pay.

>Changes in economy over time have led to confusion over the law, enacted in 1938, and has led to lawsuits over who is entitled to overtime pay.   Last March, the Bush administration began to rewrite the FLSA, and last fall, both the House and Senate voted against the proposed changes, and there continues to be controversy over the final regulations both inside and outside Congress.

>The Post reports that tens of thousands of workers have written to the Labor Department and a quarter of a million have petitioned the White House to oppose the proposed changes.   However, many business trade groups such as the National Retail Federation, the US Chamber of Commerce, the National Association of Manufacturers, the National Restaurant Association and the Society for Human Resource Management support the changes.   Meanwhile, labor advocates say they are dedicated to fighting the proposed changes, using legislation or litigation.