Hit the brakes

July 22, 2004

THE LABOR DEPARTMENT'S 500-page attempt to update the Fair Labor Standards Act has its good points, and is certainly an improvement over its first draft, but it still doesn't succeed at its main mission: making the rules clearer.

Changes in who qualifies for overtime -- which could alter the work lives of 1.3 million to 6 million people, depending on who is estimating -- should be crystalline, and these are not.

The workforce act needs a facelift; after all, there are precious few straw bosses and key-punch operators anymore. But by adding new terms such as "team leader" and "major projects," then leaving their definitions to employers, the Labor Department is realigning the spine of the act. That will lead to more confusion -- and more lawsuits -- over who must be paid for working more than the standard 40 hours a week.

For example, many hourly employees are called team leaders under the varied organizational arrangements in workplaces. Those called team leaders under the new rules may not earn overtime. The chain-store dress department worker who spends an hour a week setting her own and two other employees' work schedules is a team leader; does that mean they get overtime and she does not?

The rules also seem to class day care workers as teachers, which would deprive them of overtime pay. They say salespeople can earn OT, but not those who advise customers on which of the company's products to buy. They seem to say that sous chefs -- many of whom merely do the chopping and preparing for the main chef -- are exempt, while cooks are not. It may not be an advantage to get promoted anymore.

Even the new minimum and maximum salaries for who qualifies for overtime, while much improved, are still flawed. There is no mechanism for the dollar amounts to follow the economy, so in years they will look as out-of-whack as the current ones -- set in 1978 -- do today. Perhaps the administration intends to revise these rules every year or two.

If a balky Congress doesn't act to stall it, the rules will be in force Aug. 23. Then step out of the way for the flood of commotion soon after. At least the lawyers and the consultants will be pleased.

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