Today’s News and Commentary — March 12

Published March 12th, 2014 -  - 03.12.149


The Obama Administration announced today that the Labor Department will amend its regulations to require overtime pay for millions of white-collar employees, the New York Times, Wall Street Journal and Washington Post report. Businesses currently have discretion to classify fast-food managers, loan officers, computer technicians, and other employees as “executives or professionals” to avoid paying them overtime, even if the employees spend only a minimal portion of their time supervising others. The new rules will require that employees perform a certain percentage of “executive” work before they can be considered exempt from overtime regulations.

The President’s decision comes after his announcement in January that he would use his executive authority to increase the minimum wage for federal contractors to $10.10 per hour. To promote the latter goal of increasing the federal minimum wage for all employees, President Obama visited a Gap store in New York City yesterday to salute the clothing chain for raising its minimum wage. Today, the Washington Post reports that the White House is also launching a campaign to highlight the gender-wage gap, as women continue to earn 77 cents for every dollar earned by men in the workforce, despite surpassing men in obtaining college degrees. The White House has argued that a raise in the federal minimum wage would, among other things, shrink the gender wage gap by nearly 5 percent, since women are more likely to earn minimum wage.

The Labor Department has proposed a new rule that would make it easier for people with 401(k) retirement plans to locate what fees and expenses are attached, the Wall Street Journal and Washington Post report. While current rules require employers offering 401(k) plans to furnish detailed information about their services and the compensation employees will receive, the new rule would impose limits on the disclosure forms to make them shorter and less confusing. Michelle Singletary of the Washington Post writes in her column of the importance of the new proposal for helping workers understand the fees associated with their plans.

In the aftermath of the union election at Volkswagen last month that resulted in a 712–626 vote to reject representation by the United Auto Workers, the UAW asked the NLRB for a new election, claiming that public statements by Tennessee Governor Bill Haslam, Senator Bob Corker, and others impermissibly interfered. This week, the Wall Street Journal reports that the NLRB’s acting regional director has ruled that if a new hearing is scheduled on whether to hold a new vote, anti-union workers will be permitted to rebut the UAW’s objections, cross-examine witnesses and file briefs with the board. It is unusual for individuals to speak at post-election hearings, but due to the unique cooperation between the UAW and Volkswagen, the NLRB regional director ruled that the workers groups should be heard to represent the anti-union perspective.

The nation’s unemployment rate is down to 6.7%, but many economists believe the number is misleading because it does not count the discouraged workers who have given up on job searches, taking them out of the labor pool. The Wall Street Journal reports that the Labor Department and Federal Reserve are therefore closely monitoring other indices, such as the “quits” rate, which monitors the percentage of workers who voluntarily resigned from their jobs. (The quits rate is currently 1.7%, down from the recent high of 1.8%.)

In international news, the IMF has released a statement on Qatar’s labor record as the country prepares for the 2022 FIFA World Cup, the Wall Street Journal reports. Qatar has relied on thousands of foreign workers to develop infrastructure in anticipation of the World Cup, but the European Union, NGOs, and other observers have criticized the workers’ poor living and working conditions. The IMF statement is the latest expression of concern that exploitative labor practices could hinder the country’s growth by making it more difficult to recruit foreign workers from Nepal, India, Bangladesh, and Pakistan. 

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