Chamber Briefed On Overtime Pay Changes

Chamber Briefed On Overtime Pay Changes

Mount Vernon-Lee Chamber of Commerce members were assured Tuesday that new Federal overtime pay regulations were a plus for "both business and workers."

That claim came from Robert Varnell, deputy solicitor, U.S. Department of Labor, during the group's regular monthly business lunch. Varnell gave an in-depth explanation of newly enacted regulations of the Fair Labor Standards Act defining who is and who is not qualified for overtime pay.

Speaking at the Mount Vernon Inn Restaurant, Varnell told the group, "This Administration has a common sense approach to regulations — ones that make sense for the 21st century workplace. Updating these rules is one of the biggest accomplishments of the Department of Labor in recent memory."

He pointed out, "The last update was 55 years ago. At that time they [the regulations] referred to such occupations as straw bosses, gang leaders, and the like. Today that's only applicable to "The Sopranos."

Varnell insisted that class action suits over wage discrimination really "only benefit the lawyers. In most overtime litigations workers don't see any benefits for two years, and then only minimally.

"Lawyers are the big winners. In the Taco Bell suit workers gained an average $1,300 extra in annual wages while the lawyers received $1.5 million."

THE DOL evaluated more than 80,000 comments on the proposed changes, according to Varnell. He highlighted the department's claim that, "more than 1.3 million new workers are now entitled to overtime pay."

In a powerpoint presentation, Varnell pointed out:

*Federal minimum wage is now $5.15 per hour,

*Overtime is calculated at one and one half times the regular pay rate for all hours over 40 per week,

*Those exempt from both the new minimum wage and overtime pay regulations are executive, administrative, professional, outside sales, and certain computer employees. These are known as the "white collar exemptions,"

*Exemptions do not apply to "blue collar" workers, police, fire fighters, paramedics, emergency medical technicians, and similar public safety employees, and

*Employers must comply with existing union contracts regardless of the new regulations and collective bargaining is not impacted.

Varnell stressed there are three tests for exemption. These are:

*Salary level test — A minimum amount of earnings,

*Salary basis test — A predetermined salary not subject to deductions because of the quality and quantity of work, and

*Duties test — Performing managerial or professional job functions as set forth in the regulations.

In the final analysis, "The law leaves to the Secretary of Labor to determine certain exemptions from the regulations," Varnell said. For additional information on Part 541 exemptions, go to To ask specific questions or register a comment attendees were advised to email: or telephone 1-866-4US-WAGE.