[ Issues ]

Fair Labor Standards Act

The Fair Labor Standards Act (FLSA) is the nation's premier employment statute. In the words of President Franklin Roosevelt, the FLSA "protects workers unable to protect themselves from excessively low wages and excessively long hours." It does so by establishing a federal minimum hourly wage and by requiring employers to pay time-and-a-half premium pay for work performed in excess of 40 hours a week. The FLSA is intended to set a national floor for wages and hours, above which states may provide additional protections or a higher minimum wage.

The FLSA has been under attack since Republicans took control of Congress in the mid-1990s, an attack that intensified when they took the White House in 2000. GOP leaders in Congress, at the bidding of corporate lobbyists, held off Democratic attempts to raise the minimum wage for nearly a decade. In 2004, the Bush administration took away overtime protection from millions of workers through regulations issued by the Department of Labor, and the Republican-led Congress refused to reverse them.

When the Democrats gained control of Congress in January 2007, however, things began to change. Legislation to increase the minimum wage by $2.10 an hour was one of the first pieces of legislation to pass the Democratic-led House of Representatives. It subsequently passed the Senate and was signed into law in May 2007. The second of three increases went into effect in July 2008, and the federal minimum wage is currently $6.55 an hour. In July 2009, it will rise to $7.25. Although this is a significant increase that benefited millions of workers, the minimum wage will need another significant boost in order to help lift low-wage workers out of poverty.

For this reason, the UAW and other unions are supporting President Obama's call for a new minimum wage bill to go into effect after the third hike under current law. This legislation should increase the wage floor to $9.50 in three steps over two years, and should index the minimum wage to inflation so that it will increase automatically rather than requiring congressional action.

We can expect continued opposition from Republicans and their corporate allies. In recent years they have countered legislation to increase the minimum wage with proposals to effectively eliminate the federal wage floor by permitting states to opt out of future increases. The opt-out proposal would give states a veto over any future increases and would completely undermine the FLSA's role as a national wage floor. Other Republican minimum wage counterproposals have included eliminating FLSA protection for large classes of workers and/or additional tax cuts for corporations or the very wealthy.

Contrary to misinformation spread by opponents of the minimum wage, adults make up the largest share of workers who would benefit from a minimum wage increase. Forty percent of minimum wage workers are the sole breadwinners in their families. Moreover, despite what many opponents of the minimum wage continue to claim, several studies on past federal and state minimum wage increases have concluded there is no evidence they cause job loss. In fact, in October 2006 more than 600 economists, including five Nobel Prize winners, signed on to a statement in support of increasing and indexing the minimum wage.

The UAW believes the federal minimum wage needs to be raised to the level Congress intended when the FLSA was enacted in 1938, one that will lift working families out of poverty. In addition, we support indexing the wage to inflation to eliminate the need for protracted legislative battles in the future. An increase in the minimum wage is both humane and good for the economy. It would help raise the standard of living of millions of working people. At the same time, it would provide the economy with a needed boost, by increasing the purchasing power of millions of American workers.

During the 111th Congress, the UAW and our allies will fight to enact new legislation to increase and index the minimum wage. We will insist that Congress pass a clean minimum wage bill, without any extraneous proposals that would take away FLSA protections or provide additional tax cuts for corporations or for the wealthiest Americans.

Action

Eligibility for Overtime

When the Department of Labor issued new "white collar" employee regulations in 2004, it removed millions of workers from the wage-and-hour protections of the FLSA. One way this was accomplished was by setting the threshold for automatic overtime eligibility at an unrealistically low annual salary level, below $27,500. This means that most "white collar" workers with a salary of $27,500 or more a year are subject to a series of regulatory tests to determine whether or not they are entitled to overtime pay.

The UAW believes that no worker whose annual salary is less than $50,000 should be denied overtime pay, regardless of his or her education, job title or duties. This is the threshold that would have been set under the pre-2004 overtime rules, adjusted for inflation. Accordingly, in the 111th Congress, we will advocate for legislation to increase the eligibility threshold for the FLSA's automatic overtime protection and to index this threshold to keep pace with inflation.

Action

Comp Time

Since 1995, when Republicans gained control of both chambers of Congress, business groups and their Republican allies in Congress have been trying to enact comp time legislation for private sector workers, calling it "family-friendly" legislation. However, the truth is that comp time would erode the FLSA by allowing employers to substitute a promise of compensatory time off in the future for premium pay received at the time an employee works more than 40 hours a week. Although there is less risk from comp time legislation now that Congress and the White House are in Democratic hands, it remains a high priority for the business community. As a result, Republicans are expected to continue to push for comp time, perhaps as an amendment to a minimum wage increase. Thus, we must remain vigilant in our opposition to comp time.

Comp time bills introduced in Congress over the last decade would allow employers to issue comp time credit to employees who work more than 40 hours in a week rather than paying them time-and-a-half overtime pay. Comp time "banks" could accumulate up to 160 hours – one month's wages – before the employer would have to pay overtime premium pay.

Nothing in past comp time bills requires employers to actually give compensatory time to their workers. Employers are allowed to turn down employee requests to use their banked comp time if the time off would, in the judgment of the employer, interfere with the employer’s business operations. Moreover, employers are allowed to hold accrued comp time in the "bank" for up to 13 months. Thus, for many employers, comp time would result in a no-interest loan from the workers to the employer.

Contrary to what proponents of comp time claim, comp time would not be truly voluntary, for at least two reasons. First, most nonunionized workers are afraid to say no to their employer's requests because they are at-will employees and can be fired for almost any reason. Second, under the comp time legislation, employers are allowed to discriminate against workers who decline to take comp time by giving all the overtime to workers who "volunteer" for comp time and none to those who want time-and-a-half pay instead of comp time.

Comp time is really just a pay cut. Even if workers get to take their compensatory time off, they have less money at the end of the year. Comp time doesn't pay the rent or the grocery bills. Rather, comp time makes it cheaper for employers to work employees overtime. Naturally, if it's cheaper, employers will require more overtime. This will lead to more stress and less family time for workers. For these reasons, the UAW will continue to oppose attempts to amend the FLSA to allow comp time.

Action