"Whatever Happened to Overtime?", a piece written by a Job Creator

[Ed Anger]

I'd replace all of you with robots.

[Ideologue]

I'd replace you with a central allied mastercomputer.  CHECKMATE.

[Ed Anger]

I'd replace you with a central allied mastercomputer.  CHECKMATE.

colossus the forbin project

[CountDeMoney]

I dont understand why there is a distinction in the US between salaried and hourly paid workers for the purposes of paying overtime.

What is the difference between salaried and full-time hourly employees then?

How the employer classifies them.

[Baron von Schtinkenbutt]

Exactly.  I am not sure what that has to do with a statutory limit on hours worked in a day before overtime is earned.

I understand why certain types of employees should be exempted from overtime requirements.  But disentitlement to overtime simply by the method used to calculate pay seems arbitrary.  To use an example, all our secretarial staff are paid salaries.  But if they work more than the statutory limit on any given day they also earn overtime.  That just seems fair.

I think we have a fundamental disconnect here.  If there is a statutory limit on how long your secretary works, why is she not hourly?  The whole point of "salary" is that you get paid to produce an amount of work, not have your butt in a chair for X hours a week.  Whether that amount of work requires 20 hours or 60 hours on your part is (theoretically) irrelevant.

[Baron von Schtinkenbutt]

How the employer classifies them.

No shit.   I was trying to find out what the distinction is in Canuckistan.

[MadImmortalMan]

Exactly.  I am not sure what that has to do with a statutory limit on hours worked in a day before overtime is earned.

I understand why certain types of employees should be exempted from overtime requirements.  But disentitlement to overtime simply by the method used to calculate pay seems arbitrary.  To use an example, all our secretarial staff are paid salaries.  But if they work more than the statutory limit on any given day they also earn overtime.  That just seems fair.

That would be nice. My lifetime income would be significantly higher today if ours worked like that. 

The technical term for salaried employees is "exempt". Meaning exempt from overtime rules.

[CountDeMoney]

The technical term for salaried employees is "exempt". Meaning exempt from overtime rules.

And why?  Because the employer says so.  Easy.

[OttoVonBismarck]

Exactly.  I am not sure what that has to do with a statutory limit on hours worked in a day before overtime is earned.

I understand why certain types of employees should be exempted from overtime requirements.  But disentitlement to overtime simply by the method used to calculate pay seems arbitrary.  To use an example, all our secretarial staff are paid salaries.  But if they work more than the statutory limit on any given day they also earn overtime.  That just seems fair.

It's not actually based on how you're paid, but people here tend to be stupid.

There's two basic ways you can be paid as far as the Fair Labor Standards Act is concerned: Hourly, or Salary. Hourly employees must be paid an agreed rate for every hour worked, there is a Federal minimum wage for this rate (tipped employees paid a reduced minimum), and they must be paid 1.5x that rate for every hour worked over 40 hours. There is no overtime for going over x number of hours per day, a lot of people choose to work four 10 hour days instead of five 8s, or their employers choose for them.

Within the salaried classification, there are two further classifications: exempt and non-exempt. If you are a non-exempt salaried employee, you must be paid overtime for hours worked over 40 per week. If you are exempt, you do not have to be paid overtime. However, to be classified as exempt requires two things:

1. Income over the $23k threshold
2. Performance of exempt job duties - this is a vaguely defined "high level duties", usually recognized as some form of managerial duty.

So for this reason you see the following situations:

1. Certain highly paid factory workers can earn $100,000+ per year (chemical plant operators are a good example), they are paid hourly, and typically work an average of 45-50 hours a week, so a good chunk of their pay is 1.5x overtime every single week. Train engineers are in the same boat pay wise.

2. Certain very low paid persons who are still "managers" can be paid no overtime. For example a Taco Bell manager might earn $40k a year and work 70 hours a week and he'll never see a dime of overtime.

3. A lot of office drones are salaried but are non-exempt. For example when I started at the Federal Government after leaving the Army, I was just a drone, if I worked over 40 per week they had to pay me overtime. I was a salaried employee, but I was non-exempt because my duties were not "high level or managerial" type tasks. Now that I'm a manager, I'm not paid overtime. I'm probably not a good example, a law firm secretary is a better one. (I'm not a good example because laws governing most workers often do not actually apply to Federal employees anyway, although they often choose to implement them for us regardless.) Here in the U.S. your secretaries would be in the same boat, salaried but non-exempt, you'd have to pay them overtime.

Why was it set up this way? Historically being a salaried manager was something that only people in upper income brackets were, and also this was an class in opposition to labor. Since the FLSA was promulgated on the backs of labor movements it's not surprising it doesn't protect the management class. No one would have thought they'd needed this protection because no one imagined a dude barely scraping by managing a Burger King would fall under these rules, but today they do.

Additionally salaried used to mean something a lot different in the United States. It used to be if you were on salary you basically had an entitlement to your pay, regardless of whether you worked or not. You were paid for what you did, not how much you worked. If you got your job done in 10 hours a week and no one saw you otherwise, then you'd still be expected to be paid. Now since most salarymen traditionally were managerial, it'd be hard to have done the job in 10 hours a week. But slowly that eroded. These days you can be salaried, which still means in theory your employer has to pay you regardless of whether you work the hours or not, but now they are allowed to "require" you to take paid time off if you miss a day.

So in the past if a salaryman manager took a day off, oh well. As long as the employer didn't consider it a disciplinary action/firing grounds, he'd be paid, he wouldn't lose any "vacation" (salarymen didn't have banked PTO, they instead could just arrange vacations as often or as little as they wanted.) But now if you don't work a day and you're salaried, your employer is allowed to use PTO balances for those days, and they are also even allowed to deduct days worth of pay based on you not working those days. The only lingering protections of being salaried is the law actually does say that if you work even a moment in a day, you must be paid for the full day if you're salary. But if you miss a whole day, they can dock you a whole day's pay. If you work 1 minute a day, they have to pay you, but they're allowed to force you to spend down PTO balances to cover the difference in those scenarios (so you'd only be getting paid free time if you did this for long enough to exhaust PTO.)

Also in addition to all the rules above, millions of employees are misclassified against all readings of Federal law as exempt when they are simply, legally, supposed to be non-exempt. No one goes around checking this stuff. The W&H people only investigate if a claim is made, and they usually take a century or so to resolve an investigation.

In addition to all this, these rules also only apply to "employees." Lots of people who work under contract are not actually employees and receive none of the protections of these laws.

[OttoVonBismarck]

Also State laws vary, some States actually mandate overtime for going over the "8 hour workday", but Federally there's a 40 hour work week that's enforced and not an 8 hour work day.

Also, in many of the States that have strict 8 hour days, if you have a "regularly scheduled" work week of four 10 hour days, your employer can exempt you from overtime. But if your regular schedule isn't 10 hours a day and you go over, they aren't supposed to let you "adjust" later on. (Meaning if you for some reason stay 2 hours late, they aren't supposed to then reduce your next day by two 2 hours but are instead required to pay 2 hours of OT--but the State laws tend to be even more Byzantine than the Federal in this regard.)

[Martinus]

Also the common persons most valuable asset is usually real property, which appreciayes with inflation, whilst the debt used to finance its purchase is diminished.

Most common people don't keep reichsmarks in their mattress.

Yeah. I would say that inflation hits not the common people, but the upper middle class/lower upper class the hardest. It is a form of wealth distribution from them to the "common people" (through government spending of the money it prints/public debt it devalues).

[dps]

Exactly.  I am not sure what that has to do with a statutory limit on hours worked in a day before overtime is earned.

I understand why certain types of employees should be exempted from overtime requirements.  But disentitlement to overtime simply by the method used to calculate pay seems arbitrary.  To use an example, all our secretarial staff are paid salaries.  But if they work more than the statutory limit on any given day they also earn overtime.  That just seems fair.

It's not actually based on how you're paid, but people here tend to be stupid.

There's two basic ways you can be paid as far as the Fair Labor Standards Act is concerned: Hourly, or Salary. Hourly employees must be paid an agreed rate for every hour worked, there is a Federal minimum wage for this rate (tipped employees paid a reduced minimum), and they must be paid 1.5x that rate for every hour worked over 40 hours. There is no overtime for going over x number of hours per day, a lot of people choose to work four 10 hour days instead of five 8s, or their employers choose for them.

Within the salaried classification, there are two further classifications: exempt and non-exempt. If you are a non-exempt salaried employee, you must be paid overtime for hours worked over 40 per week. If you are exempt, you do not have to be paid overtime. However, to be classified as exempt requires two things:

1. Income over the $23k threshold
2. Performance of exempt job duties - this is a vaguely defined "high level duties", usually recognized as some form of managerial duty.

So for this reason you see the following situations:

1. Certain highly paid factory workers can earn $100,000+ per year (chemical plant operators are a good example), they are paid hourly, and typically work an average of 45-50 hours a week, so a good chunk of their pay is 1.5x overtime every single week. Train engineers are in the same boat pay wise.

2. Certain very low paid persons who are still "managers" can be paid no overtime. For example a Taco Bell manager might earn $40k a year and work 70 hours a week and he'll never see a dime of overtime.

3. A lot of office drones are salaried but are non-exempt. For example when I started at the Federal Government after leaving the Army, I was just a drone, if I worked over 40 per week they had to pay me overtime. I was a salaried employee, but I was non-exempt because my duties were not "high level or managerial" type tasks. Now that I'm a manager, I'm not paid overtime. I'm probably not a good example, a law firm secretary is a better one. (I'm not a good example because laws governing most workers often do not actually apply to Federal employees anyway, although they often choose to implement them for us regardless.) Here in the U.S. your secretaries would be in the same boat, salaried but non-exempt, you'd have to pay them overtime.

Why was it set up this way? Historically being a salaried manager was something that only people in upper income brackets were, and also this was an class in opposition to labor. Since the FLSA was promulgated on the backs of labor movements it's not surprising it doesn't protect the management class. No one would have thought they'd needed this protection because no one imagined a dude barely scraping by managing a Burger King would fall under these rules, but today they do.

Additionally salaried used to mean something a lot different in the United States. It used to be if you were on salary you basically had an entitlement to your pay, regardless of whether you worked or not. You were paid for what you did, not how much you worked. If you got your job done in 10 hours a week and no one saw you otherwise, then you'd still be expected to be paid. Now since most salarymen traditionally were managerial, it'd be hard to have done the job in 10 hours a week. But slowly that eroded. These days you can be salaried, which still means in theory your employer has to pay you regardless of whether you work the hours or not, but now they are allowed to "require" you to take paid time off if you miss a day.

So in the past if a salaryman manager took a day off, oh well. As long as the employer didn't consider it a disciplinary action/firing grounds, he'd be paid, he wouldn't lose any "vacation" (salarymen didn't have banked PTO, they instead could just arrange vacations as often or as little as they wanted.) But now if you don't work a day and you're salaried, your employer is allowed to use PTO balances for those days, and they are also even allowed to deduct days worth of pay based on you not working those days. The only lingering protections of being salaried is the law actually does say that if you work even a moment in a day, you must be paid for the full day if you're salary. But if you miss a whole day, they can dock you a whole day's pay. If you work 1 minute a day, they have to pay you, but they're allowed to force you to spend down PTO balances to cover the difference in those scenarios (so you'd only be getting paid free time if you did this for long enough to exhaust PTO.)

Also in addition to all the rules above, millions of employees are misclassified against all readings of Federal law as exempt when they are simply, legally, supposed to be non-exempt. No one goes around checking this stuff. The W&H people only investigate if a claim is made, and they usually take a century or so to resolve an investigation.

In addition to all this, these rules also only apply to "employees." Lots of people who work under contract are not actually employees and receive none of the protections of these laws.

See why I didn't want to go into detail?  OvB still didn't touch on all the twists and turns of this stuff.

[Admiral Yi]

A friend of a friend said that at her place of work the company took a vote to see if the employees wanted to be treated as exempt or non-exempt.  So apparently there is a little fudge in there.

[Eddie Teach]

What's the benefit of being exempt?

[Admiral Yi]

Pride, I guess.  "Oooh, we're management."