News & Commentary

March 21, 2016

Now that the Labor Department’s new standards for overtime pay are pending before the White House’s Office of Management and Budget (OMB), national leaders are taking positions.  The overtime rules, which date back to March 2014, would expand overtime coverage for millions of workers by raising the qualifying salary for overtime pay from $23,660 per year to $50,440.

In a recent statement Richard Trumka, President of the AFL-CIO, urged that the rules be “cemented into place,” reports The Hill.  “President Obama recognizes that the current rules are out of date and too weak to protect working men and women, so we are pleased that these improvements are moving forward.”

The GOP, however, seeks to block the new rules, says The Hill.  Last Thursday House and Senate Republicans introduced the Protecting Workplace Advancement and Opportunity Act to “handcuff’ the Labor Department in issuing the rule.  If approved, the Act would require the Labor Department to assess the economic impact of the standards on the business community and prevent it from implementing annual increases accounting for inflation.

Senate Labor Chairman Lamar Alexander (R-Tenn.), who is sponsoring the bill, says that the overtime rules will hurt, not help, American’s lowest paid workers “[b]y reducing their opportunities for a promotion or a better job and making it all but impossible to negotiate flexible schedules.”  Another sponsor, Representative Tim Walberg, calls the rules irresponsible. “Our nations outdated overtime rules are in need of modernization, but it must be done in a responsible way that doesn’t stifle opportunities for working families to get ahead.”

Law 360 reports that a National Labor Relations Board (NLRB) judge has found that Chipotle’s social media policy violates the National Labor Relations Act.   James Kennedy, a former employee in Havertown, Pennsylvania, removed a number of tweets critical of working conditions at the franchise after reviewing Chipotle’s social media code in a meeting with management.  One tweet, which Kennedy posted in response to a customer’s post “Free chipotle is the best thanks,” said “nothing is free, only cheap #labor.  Crew members only make $8.50 an hour how much is that steak bowl really?”  The NLRB judge, Susan A. Flynn, ruled that the tweets were “protected concerted activity” and “for the purpose of mutual aid or protection.”  She further found that Chipotle’s request that the tweets be removed unlawful.  If the full NLRB adopts Flynn’s ruling, Chipotle will no longer be able to prevent employees from posting about working conditions, terms of employment, wages and other related topics on social media.

As cities and states hike minimum wages across the country, some say that online shoppers may pick up the tab.  Fortune, citing a recent study by the real estate services firm CBRE,  reports that the increasing cost of human labor will have a “pronounced effect” on distribution centers that fulfill online orders for sites such as Amazon.  The study indicates that every $1 increase in hourly wages will add $1 million in costs to warehouses with a staff over 500.

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