Overtime pay for overtime work? What a concept!

child+labor

It’s a fair question:

If income inequity is a major problem, what could the federal government do to address it? What could it reasonably, legitimately do in order to protect the American working and middle classes from the economic forces that continue to undermine their earning power?

Here’s one simple answer: Overtime pay for overtime work.

It is not by any means a new or revolutionary answer. The Fair Labor Standards Act, which established the minimum wage, the 40-hour work week, child labor laws and overtime pay, was passed way back in 1938.** By now, those are basic, fundamental concepts that should no longer be considered controversial. But thanks to concerted business lobbying and Republican opposition, some of its provisions have been rendered pretty much toothless by the passage of time.

For example, from the beginning the FLSA has recognized that requiring time-and-a-half pay for hours beyond the standard 40-hour work week would not be appropriate for higher-paid, salaried workers in professional, administrative and managerial jobs. The question is how you exempt those workers while still protecting those who do need that protection. The distinction can be thorny, because employers often try to evade the law by classifying all or most of their workforce as professional or supervisory, and thus ineligible for overtime.

One mechanism to make that distinction is by pay level.  Under the FLSA, anybody paid below a certain base amount is assumed not to be a professional or supervisory worker, and thus eligible for overtime. If you “inflation-adjust” the threshold that was in effect way back in 1975, today it would be $50,440.

However, that threshold has NOT been adjusted for inflation. Today, the pay threshold in defining managerial and professional workers has become so absurdly low as to be almost meaningless. At $23,660, it’s below poverty wages for a family of four.

To give you some idea of the impact, some 65 percent of salaried workers fell below the threshold in 1975, meaning they were eligible for protection under the overtime rule. Today,  just 11 percent of salaried employees are covered by the rule.

More than a year ago, President Obama issued an executive order to begin modernizing the overtime salary threshold, a step that is clearly within his powers as president. Immediately, congressional Republicans pledged to do everything within their own powers to stop him.

“If you don’t have a job, you don’t qualify for overtime,” House Speaker John Boehner said in March 2014. “So what do you get out of it? You get nothing. The president’s policies are making it difficult for employers to expand employment. And until the president’s policies get out of the way, employers are going to continue to sit on their hands.”

In the 15 months since Boehner’s prediction, the economy has added 3.6 million jobs, the unemployment rate has fallen from 6.7 percent to 5.5 percent, and the Obama administration has moved close to issuing its new proposed overtime rule. It may be released for public comment as soon as this week, and Republican leaders are rallying to try to halt it.

As Sen. Lamar Alexander put it, the still-unreleased proposal “seems engineered to make it as unappealing as possible to be an employer creating jobs in this country.”

Many employers of course would prefer to continue denying overtime pay to millions of lower-paid Americans whom the long-standing law was clearly designed to protect. On the other hand, raising the threshold would mean that a lot more hard-working Americans who have been working 50- or 60-hour weeks would start to get paid time and a half for that overtime, just as the law envisions.

And employers do have an option to avoid that penalty. If they don’t want to pay that time-and-a-half rate, they could actually take the step of hiring additional employees to share the work burden. What a concept!

Just to refresh your memory, here’s a chart that documents the declining share of our nation’s economic output being paid to its working people, i.e., those who go to work each day so they can pay the rent or mortgage, buy food for their families, etc.:

laborshare

And here’s a chart over the same time frame documenting the rise of after-tax corporate profits as a share of the national economy. As you can see, that share has more than doubled in the past 25 years over its post-World War II historic norm. (And again, it’s AFTER-TAX corporate profit.

corpinc

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** The 40-hour work week may now be considered basic law, but its adoption in 1938 was accomplished only after a long, bitter legislative and legal battle. Prior attempts at such regulation had earlier been struck down by the U.S. Supreme Court as unconstitutional, and Southern politicians in particular argued that a minimum wage and maximum work week would force mass layoffs.

 “What profiteth the laborer of the South if he gain the enactment of a wage-and-hour law — 40 cents per hour and 40 hours per week — if he then lose the opportunity to work?”, as Rep. John McClellan of Arkansas put it.

So no, the basic argument hasn’t changed much at all.

Reader Comments 0

799 comments
bu2
bu2

Actually have a couple of articles in the AJC today on free-lancers and contractors.  Lot of growth in that area.  Much bigger issue than OT pay.

Doom Classical liberal
Doom Classical liberal

"If income inequity is a major problem, what could the federal government do to address it?"


As demonstrated repeatedly, income inequality is not a major problem. It is nothing more than a cyclical issue tied to stock market booms and tax shifting from corporate income ledgers to individual income tax ledgers.


As for what should the Feds do? Nothing. They should leave things to the disinterested labor markets. 

Jackie_36
Jackie_36

@Doom Classical liberal PLEASE, show where it was demonstrated that income inequality is related to the stock market and corporate accounting procedures, PLEASE!!!

gotalife
gotalife

Germany wants more action on climate change because they are smart and did a green energy project.


They are in great shape and Merkal proves women leaders are competent and can govern.


Like Hillary.



SFM_Scootter
SFM_Scootter

@gotalife How long are you going to shake those pom poms,until that neocon gets elected?  LOL 

barkingfrog
barkingfrog

It seems that the US was fooled into sacrificing soldiers in World War 2 in Europe.

Russia and the other Allies could have handled it and we could have concentrated

on Japan the only country that attacked our territory. Probably would have saved many

lives in the Pacific.

gotalife
gotalife

@barkingfrog  We beat them both. A huge victory to end the war. We had to nuke Japan because they would never give up and fight to their last woman and child. They would commit suicide before surrender.

Hedley_Lammar
Hedley_Lammar

@barkingfrog Russia and the other Allies could have handled it

Russia could have. Western Europe nope. 


Japan was the only country that attacked us. But Germany declared war on us. 

dbm1
dbm1

@gotalife @barkingfrog 

A man who knew more about Japan than I did once told me that a better alternative would have been to promise no harm to the Japanese royal family.

straker
straker

Doggone - "the con reply and say: you could have quit and gone  to work somewhere else"


These are the same cons who say " what's wrong with these poor people? Why don't they get off their lazy butts and go to work?"

fiftythreepercenter
fiftythreepercenter

I wonder if teachers will have to start clocking in and out if Obama gets his increase?  I bet that'll go over well with the teachers unions.


And the business of grading tests at home will be paid time, staying later for coaching soccer will be "on the clock" time to be clocked in and out..  Gonna be a fun one to watch!!

josef
josef

The Soviets (by no means all Russians) had turned the tide at Stalingrad before American aid had it's impact.  The "silent accord" with Japan allowed them to transfer divisions well-prepared for Winter fighting from Siberia.

Doggone_GA
Doggone_GA

@IReportYouWhine#1 @josef He pulled them out because he was being defeated...he chose to close that front because at the time the Eastern Front was a greater danger...or so he thought.  He was going to lose those armies completely if he hadn't pulled them out.

josef
josef

Not to put too fine a line on it, but the Eastern front was beset by factors not present on the Western front.One, much of the German forces there were composed of Axis allies (Rumanians, Italians, Hungarians) who had little motivation to fight, were ill-equipped, and were pretty much glad to see the Soviets coming.Secondly, there were the Partisans whose activities behind the German lines put them in the position of fighting a two front war along a single line.

In the West, not to downplay the heroism of the undergrounds and partisans, they were not so serious a factor.Secondly, at the time of the invasion, the German troops occupying and defending the mainland were pretty much pampered, fat and sassy.Only when the battle hardened special forces came in from the east did a real fight ensue.

The Allies had no forces on the Eastern front.Targets were out of range of Allied air forces.That battle was a Soviet thing with significant but limited supplies from the West.

IReportYouWhine#1
IReportYouWhine#1

@josef Forget lend/ lease, what about the divisions that hitler had to pull out of russia to guard against the AmeRicans?

fedup52
fedup52

Heaven forbid someone wants to get ahead.....

++++

Rain

What happened to family time.  

Are you against family values?

Doggone_GA
Doggone_GA

@IReportYouWhine#1 Is that supposed to make sense?  Sure, he wasn't afraid of them...but he sure as hell was jealous of them.  As he was of most the other powers in that war.  Personally, I would love to be able to know his private reaction to Eisenhower getting the Supreme Commander instead of Patton.

IReportYouWhine#1
IReportYouWhine#1

It was AmeRica's industrial might, something you fascists know nothing of, that saved russia. 


And look at the thanks we get.

Hedley_Lammar
Hedley_Lammar

@IReportYouWhine#1  It was AmeRica's industrial might, something you fascists know nothing of, that saved russia. 


No...No it wasnt. 



Doggone_GA
Doggone_GA

@IReportYouWhine#1 We helped, but it was ultimately Russia's industrial might and it's huge population of available men for soldiering that defeated the German invasion.

td1234
td1234

A bit of information from the below discussion about single vs married households and being middle class or poor. 


"A record 56,023,000 women, age 16 years and over, were not in the labor force in February.


Not only was that a record high, but it's also the first time the number has exceeded 56 million, according to data from the Bureau of Labor Statistics (BLS). 

To be counted as ‘not in the labor force,’ according to the BLS, one must not have a job or have looked for one in the past four weeks. In January 2015, there were 55,756,000 women not in the labor force, which means that 267,000 women dropped out of the labor force since then.

The labor force participation rate, which is the percentage of those who are participating in the labor force by either having a job or looking for one in the past four weeks, declined in February.

According to the BLS, 56.7 percent of women were participating in the labor force in February, a drop from 56.8 percent in January. In the last year, since February 2014, the labor force participation rate for women has fluctuated within a range of 56.6 percent to 57.2 percent, and February’s percentage of 56.7 falls on the low end of that scale. 

Hedley_Lammar
Hedley_Lammar

@td1234 The labor force participation rate, which is the percentage of those who are participating in the labor force by either having a job or looking for one in the past four weeks, declined in February.


Baby Boomers. 

Nick_Danger
Nick_Danger

@td1234 

""A record 56,023,000 women, age 16 years and over, were not in the labor force in February. "

It stands to reason, since there were a record number of women over 16 years of age, right?

Hedley_Lammar
Hedley_Lammar

@Nick_Danger @td1234 Labor participation rates peaked in the 90's because of the baby boomers.


They compare now to then to show how low rates are today. 


But doing that isn't comparing apples to apples. Its NEVER going back to what it was during the boomer days.  EVER

td1234
td1234

@Jackie_36 And then on the other side of the equation is what is happening in cities like Baltimore, Chicago and NY when police officers are made not to enforce the law aggressively. The good residents are the victims of increasing crime. 


What do you want, a few thugs dying or good residents dying? 

Jackie_36
Jackie_36

@td1234 @Jackie_36 First of all, WHAT IS A THUG?

Second, the so-called other side of the equation where you state the police officers "are made not to enforce the law aggressively" is a question that you can answer because it all supposition and speculation.

IReportYouWhine#1
IReportYouWhine#1

@Bruno2 The Germans were killing the Russians at a margin of 12 to 1, if not more. They are lucky we came to their rescue. 


Tatsache

Doggone_GA
Doggone_GA

@gotalife @IReportYouWhine#1 @Bruno2 Eventually, but it might be debatable what could have happened if the Germans had been more realistic about the amount of time needed and the conditions they would be under in the winter.

Basically, Russia's greatest ally helped to defeat the Germans: winter

gotalife
gotalife

@Doggone_GA @gotalife @IReportYouWhine#1 @Bruno2  Winter is the time to attack  My Dad served under Patton at the battle of the bulge so he told me what happened up to the point where he jumped in a fox hole and a nazi shot him in the head. He killed that Nazi but was wounded so his war was over.

Bruno2
Bruno2

@IReportYouWhine#1 @Doggone_GA @Bruno2 The visual comparison is pretty stunning on the video.  Of course, the Germans were mounting casualties on 2 different fronts, so their total number was pretty high.

Bruno2
Bruno2

I was expecting josef to take the bait and jump in, but one startling thing the video demonstrates is how bad the Polish people had it.  Behind Russia and Germany, I'm guessing that they were in 3rd place in terms of lost soldiers and civilians.

Doggone_GA
Doggone_GA

@Bruno2 The Polish are a big stain on the Allies in that war.  England and France went to war because of Poland being invaded by the Germans, then we and they all sat back and let the Russians do exactly the same thing.

Personally, I'm not proud of how the Allies let that happen.

Bruno2
Bruno2

@Doggone_GA @Bruno2 Supposedly some deals were made to allow the Russians to freely abuse the Germans later on for a time before the Americans stepped in to save the German citizens.  I guess you can't always take the high road when large groups of armed people are involved.