Tuesday, January 06, 2004

DOL to Employers: Here's Our Regulations. Here's How to Get Around Them.

The Labor Department prides itself on offering one-stop shopping. But now they've outdone themselves. They not only propose regulations that will take away overtime pay from millions of workers, but they even provide helpful suggestions for employers on how to get around those regulations, cheating workers of even more overtime.

How thoughtful.

According to an AP story, some of the things creative employers might try are
  • Cutting workers' hourly wages so that regular and overtime pay equal the original salary, or

  • raising salaries to the new $22,100 annual threshold, making them ineligible. (If employers raise a worker's salary "it means they're getting a raise - that's not a way around overtime," according to a DOL spokesperson...even if their total takehome is less.
If an employer finds that, because the rules have changed, he may have to pay overtime to a worker who didn't earn it before, he can just convert the worker's pay from a salary to an hourly rate, "adjust" (cut) the pay a little to get back under the threshold, then add the overtime and -- the worker is making the same as before the "improvement." That's how a "wage adjustment" is not a pay cut.

We here at Confined Space are not economists, so we're not sure if this worker who received the "wage adjustment" was one of the workers who DOL claims was being helped by the new regulations.

But, of course, the Labor Department is not actually recommending these measures.
The department says it is merely listing well-known choices available to employers now or under the new rules. "We're not saying anybody should do any of this," department spokesman Ed Frank said.
Although I'm sure they wouldn't object of some of the money saved was contributed to the Republican campaign chest.

The AFL-CIO was also not amused, as you can imagine.

So what's next? OSHA advising employers on how to get around OSHA citations? Maybe the IRS can give advice to business owners about how not to pay taxes.

Update: For more information, click here: