WASHINGTON – When the House voted this week to block Bush administration changes in overtime pay rules, Melody Jones was not exactly glued to the outcome.
“Regardless of what goes on on Capitol Hill, we don’t anticipate much impact from the changes,” said Jones, human resources director at financial services giant T. Rowe Price. “Once the dust settles we’ll go back to see if we have to make adjustments, but I don’t expect any.”
Throughout the state, businesses say they have seen few if any changes in the wake of new regulations that took effect Aug. 23.
But workers worry that, while they have seen little change so far, they could get hit in the pocketbook down the road.
“I could lose up to one-third my income,” said James Ware, a sous chef from Oxon Hill who could be reclassified as a “learned professional” — not eligible for overtime pay — under the new rules.
Ware, 58, is one of a growing number of workers pinning their hopes on lawmakers’ efforts to suspend implementation of the rules.
The changes to the Fair Labor Standards Act would guarantee overtime for workers making less than $455 per week, or $23,660 per year. The old regulations capped the maximum for automatic overtime at $155 per week, or $8,060 per year.
Labor Department officials say the increase in the overtime threshold, the first since 1975, will strengthen overtime pay protections for 6.7 million American workers and ensure overtime for the neediest workers.
But other changes included in the new rules call for a number of positions to be retitled as “administrative,” “professional” or “executive” jobs, making them ineligible for overtime.
Workers who did not fall into those classifications but whose jobs were “characteristic” of those categories could be denied overtime if they earned $100,000 a year or more.
Labor organizations argue that as many as 6 million workers will lose their right to overtime as a result of those reclassifications. That figure is disputed by the Bush administration.
Those whose jobs could be reclassified include computer operators, nursery school teachers, funeral directors and sous chefs like Ware, among others, according to the Washington-based Economic Policy Institute.
“I haven’t had four years of culinary school, but they could reclassify me because of my experience and supervisory duties,” Ware said.
Ware has worked for 28 years at a large Washington, D.C., hotel that he declined to name. He said he is protected for the time-being because his union contract prevents him from losing overtime eligibility.
But if he ever leaves, he might not be so lucky: Labor groups say Ware, and thousands like him, risk losing overtime benefits in the future when they switch jobs or have contracts renegotiated.
For now, however, the rules have had little impact.
“There really haven’t been any changes,” said Kevin O’Melia, spokesman for Logistics & Transportation Services Inc., a 24-employee Elkridge firm providing services such as freight transportation. “Overtime still applies as it always did, and we don’t expect that to change.”
Jones said that only a few of T. Rowe Price’s roughly 4,000 employees became eligible for overtime as a result of the changes and that some of those reclassifications were part of an internal restructuring.
The response from Maryland businesses is consistent with responses nationally, according to the U.S. Chamber of Commerce.
“We’re keeping track of what businesses are reporting, and only a few are reporting changes,” said Michael Eastman, the chamber’s director of labor law policy.
Eastman said he does expect the changes to stick, despite a House vote Thursday that barred the use of federal funds for implementation of the new rules. That vote came as an amendment to a $142.5 billion spending bill for the departments of Labor, Education and Health and Human Services, but Eastman does not think the Senate will go along.
“There will be some sort of (labor, health and education) funding bill, but I don’t see the Senate taking up this bill at all,” he said.
-30- CNS 09-10-04