New Overtime Rules Don't Rattle Folks in NH

By David Darman on Wednesday, August 25, 2004.

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New federal labor laws went into effect this week that govern overtime rules for thousands of workers and hundreds of businesses in New Hampshire.

But business and labor leaders in the Granite state don't expect the new laws to greatly affect them, at least not in the short term.

New Hampshire Public Radio's David Darman has more.

The Bush Administration's new overtime rules have spurred demonstrations in front of the Labor Department in Washington.

They've caused recriminations between the two major presidential candidates.

But the changes are having less of an effect on folks in the granite state.

James Reidy is a labor lawyer at Sheehan Phinney Bass and Green in Concord.

He says the new rules won't change a thing for most workers.

But those who earn overtime now or are overtime eligible will continue to be, likely. there's not going to be many people who change from overtime eligibility to overtime exempt.

The new law guarantees anyone who earns less than 23,660 dollars a year the right to continue to collect overtime pay.

That means they would be paid time and a half for any hours worked over 40 hours a week.

But above that compensation level, employers could reclassify workers as ineligible for overtime.

The list of those ineligible ranges from restaurant sous chefs, to service workers who are considered 'team leaders', to employees of financial services firms.

Labor leaders charge these reclassifications could cause many workers to work longer, for less pay.

But Brett St. Clair of the Business and Industry Association of New Hampshire says he doesn't see the new regulations that way.

He says the fact that service "team leaders" can be excluded from earning overtime pay won't hold up in the working world.

the regulations make clear that they have to supervise two or more people and you just can't give somebody an assistant manager's or supervisor's title to avoid having to pay, you know, not to pay them overtime just put em on salary and not pay them overtime for hours they work over 40 hours a week. so that's the people who are going to benefit from this.

Employers may let the dust settle while they sort the new regulations out.

For one thing, the new law may not last long.

Congress may also act to change the law, when lawmakers reconvene next month.

Democratic candidate John Kerry has promised to rescind the new rules if he's elected President.

But if President Bush is reelected, the law will likely remain in place for years to come.

Mark MacKenzie, president of New Hampshire AFL-CIO, says the long term effect of the law worries him.

i don't think this will happen today or tomorrow but there are going to be employers who are going to look at the law and say this is what i think we can do and then employees are going to have to be in the position of challenging employers and going into court and fighting for this kind of decision. these are going to be really difficult things for these employees to do on their own they're expensive court cases to challenge employers on this kind of thing.

Its not clear what will happen with the new law, if it does stay on the books.

Its complicated and employers and workers may need some time just to sort out its nuances.

Yet critic Ross Eisenbrey of the Economic Policy Institute in Washington D.C. says he has no doubt the law benefits employers and harms employees.

the average person who is working overtime works about 11 hours a week of overtime. if an employer who had to pay for that at time and a half no longer has to pay for it, it can save real money. we're talking 20 percent or more of a person's income.

The overtime issue is bound to be a political wedge in Congress and the Presidential campaign.

In the meantime, New Hampshire employers and workers can keep watching the political debate, attleast until the election in November.