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As the fate of the Department of Labor’s revised overtime regulations remains in limbo as a result of a nationwide injunction (currently on appeal) issued in November 2016, Congress now has chimed-in on wage and hour issues potentially impacting non-exempt employees.
This week, the House of Representatives passed The Working Families Flexibility Act (“the Bill”), which, if passed by the Senate and signed by the President, would extend “compensatory time off” (also known as “comp-time”) rights to private sector employees.
Currently, comp-time only is available in the public sector. So, in the private sector, if a non-exempt employee works 5 hours of overtime in “workweek 1,” then the employer must pay-out that overtime, with the payroll for “workweek 1,” at the applicable time and one-half rate. If the Bill becomes law, however, a non-exempt, private sector employee would have the right to “bank” comp-time for future use (subject to accrual caps), at 1.5 hours of time-off for each overtime hour worked, instead of accepting the immediate payment of overtime. A non-exempt employee also would have the right to change his/her mind and elect to “cash out” the comp-time “bank” at the time and one-half rate.
Proponents of the Bill contend that it extends flexibility to hourly workers’ schedules, enabling them to achieve a better work-life balance, and empowers workers by giving them more control over their time and compensation. Opponents, however, express concern that employees may feel obligated or pressured by employers to elect the comp–time option (and save the employers money) and may not have the resources to seek legal assistance if necessary. The Bill does include anti-coercion measures with corresponding penalties.
The future of the Bill remains to be seen. Over the years, similar attempts to pass private sector comp-time laws have failed. We will continue to keep you posted on any developments.