Overtime pay for some federal workers could change

Overtime pay rates for some federal workers could change if the Office of Personnel Management follows the Labor Department's lead in revising its overtime regulations.

On Monday, the Labor Department will propose a series of regulatory changes covering overtime pay under the 1938 Fair Labor Standards Act. Employers use the regulations when deciding whether workers are due overtime pay. Private sector employers have long complained that the 50-year old regulations are outdated, confusing and difficult to administer. Federal agencies and employees have been locked in numerous battles over who is and who is not due overtime under the act.

Among the department's proposed changes is a plan to rewrite the criteria that employers use to determine if employees fall into administrative, professional and executive categories. If employees fall into those categories, then they aren't eligible for overtime pay. Employees ineligible for overtime pay are called "exempt" employees under the law. Employees who are eligible for overtime pay are called "nonexempt."

The Labor Department's regulations apply to private sector employers. In 1974, Congress applied the Fair Labor Standards Act to the federal government and put the Office of Personnel Management in charge of overseeing overtime rules for executive branch agencies. OPM's criteria for deciding if an employee is exempt or nonexempt are based on the Labor Department's criteria.

OPM spokesman Edmund Byrnes said Thursday that OPM is studying the Labor Department's changes. He also said that OPM was not involved in the Labor Department's revision efforts. But because OPM's rules are so similar to Labor's, it's possible that OPM will follow Labor's suit. OPM would have to propose its own regulatory changes for federal agencies to be affected.

Joe Goldberg, an attorney for the American Federation of Government Employees, said union officials are worried that changes could reduce overtime pay for some federal workers.

"AFGE is concerned that the proposed weakening of Fair Labor Standards Act protections in the private sector will be taken by OPM as justification for similar weakenings of the act's protections in the federal sector," Goldberg said.

While Goldberg views the Labor Department's changes as weakening protections, private sector human resources experts view the changes as modernization, simplification and clarification. Deron Zeppelin, director of governmental affairs for the Society for Human Resource Management, said the Labor Department is cutting its regulations from 30,000 words to 13,000 words.

"We're looking at a potential win for employers because they will know what their obligations are more clearly," Zeppelin says. "Because of simplicity, the employees are going to know what their rights are and the Labor Department can enforce the regulations on a more even basis."

Under current Labor Department criteria, if an employee exercises "discretion and independent judgment," then he is exempt from overtime. That wording would be eliminated under the Labor Department's proposed changes. Instead, an employee would be exempt from overtime if he performed "work of substantial importance" or "work requiring a high level of skill or training."

Zeppelin said the proposed changes still leave some ambiguity, but the Labor Department provides definitions for the new terms that would be used. "It's not perfect," Zeppelin said. But he noted that the regulations in place today were written 50 years ago, when the workplace was not automated and the line between management and rank-and-file employees was clearer. The proposed rules recognize changes in the workplace over the past half century, he said.

The current OPM regulations have led to numerous battles between employees and their agencies over overtime pay. Twelve Navy employees won $200,000 in back overtime pay last year because the Navy improperly classified them as exempt from the Fair Labor Standards Act. Federal Deposit Insurance Corporation employees won a similar case in 1998, as did Social Security Administration workers that year.

The Postal Service is covered by the Labor Department regulations, but Labor spokeswoman Yvonne Ralsky said postal workers would be largely unaffected because they are covered by collective bargaining agreements. The Library of Congress, Tennessee Valley Authority and Postal Rate Commission are also covered by the Labor Department regulations as well, not by the OPM regulations.

Much of the legislative branch is covered by the U.S. Office of Compliance's regulations on overtime. The Office of Compliance oversees several workplace protection laws for the House, Senate, Architect of the Capitol, Capitol Police, Congressional Budget Office and a few other agencies. An Office of Compliance official said the agency has yet to determine whether it will change its regulations to mirror the Labor Department's changes.