Today's News & Commentary — April 21, 2016

Published April 21st, 2016 -  - 04.21.164


Yesterday, the Supreme Court heard argument for Encino Motorcars v. Navarro, a dispute arising under the FLSA.  There is an exception to the FLSA for any “salesman, partsman or mechanic primarily engaged in selling or servicing automobiles.”  At issue in the case is whether service advisors at car dealerships–who work at service desks, prepare work orders, and keep in touch with customers regarding work status on orders–fall within that FLSA exception or must be paid overtime.  The Ninth Circuit held these service advisors were not covered by the exception, and thus entitled to overtime, creating a circuit split on the issue.  The Hill summarized Wednesday’s argument.

Healthcare groups that are funded primarily by Medicaid are worried about the Labor Department’s proposed overtime rule, Politico reports.  Under the new rule, the salary threshold under which workers would qualify for overtime pay would reach $50,440, a number that providers argue is unworkable for their industry.  They are hoping the rule will be modified before it is finalized, at least giving them time to negotiate with states to increase Medicaid reimbursements before the law takes effect.

Intel announced earlier this week that it would lay off 12,000 workers, responding to a long global downturn in demand for PCs.  The New York Times reports the layoffs are part of a larger corporate restructuring, as the company shifts from being the “PC company” to one that supplies chips for smartphones, cloud computing, sensors and other devices.  Microsoft has made a similar shift over the last several years.  Other former computer giants, including IBM, Dell, and Hewlett-Packard, continue to struggle.  Employes affected by the restructuring will be notified within the next 60 days.

Target has raised the minimum wage of its employees to $10 an hour.  According to Reuters, this comes as a response to pressure from competition–primarily Walmart–and political and social pressure, including the Fight for Fifteen movement, and the presidential campaign.  Target will also raise pay for employees who already make over $10 per hour, and workers will be entitled to an annual merit raise and pay-grade hike.

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