Jottings By An Employer's Lawyer

Saturday, February 19, 2005

S.14 - Otherwise Known As Flogging a Dead Horse

Having seen it work so spectacularly as an election issue in the 2004 elections, some Democratic senators just can't let go of the idea that the white collar regulation reform is evil incarnate, have now offered S. 14, Fair Wage, Competition, and Investment Act of 2005. The proposal would require courts to engage in some mind numbing statutory construction to determine exactly what the status of the current law would be, and as we have discussed before, all for very little benefit to workers. Why anyone, even those who favor rolling back the new rules think this is a good approach, is beyond me.

The legislation would also raise to $30,732 a year the minimum salary for an individual to be exempt under the executive, administrative and "managerial" exemptions. That is interesting since I am not aware of any "managerial" exemption that currently exists. My guess is the drafter meant "professional" not "managerial". The new regulations raised the amount to $23,600. The proposed legislation in addition to raising it another $7,000 would also index the minimum salary so it would increase annually based on the Employment Cost Index.

The proposed legislation, in addition to keeping the "good fight" alive on the white collar changes, also would raise the minimum wage, initially to $5.85 an hour, with additional steps to $6.55 and $7.25 over a 2 year period.

The third change to existing employment laws would be to change the definition under WARN so that the loss of work by 50 employees would now be considered a mass layoff and trigger the requirement for the 60 day WARN Act notice. Currently, the trigger under that section of the statute is either (i) 33% of the employees and at least 50 employees, or (ii) 500 employees.

The Act covers a broad variety of other topics as well, but my guess is that with the possible exception of some change in the minimum wage, the other 2 provisions discussed above won't make much headway.

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