What is changing clothes?

On Tuesday February 19, 2013 the U.S. Supreme Court announced that it will hear arguments regarding what constitutes “changing clothes” within the meaning of section 203(o) of the Fair Labor Standards Act?  Section 203(o) of the Fair Labor Standards Act provides: “In determining for the purposes of sections 206 and 207 of this title the hours for which an employee is employed, there shall be excluded any time spent in changing clothes or washing at the beginning or end of each workday which was excluded from measured working time during the week involved by the express terms of or by custom or practice under a bona fide collective-bargaining agreement applicable to the particular employee.”  The Supreme Court’s decision will likely have a wide-ranging impact on a variety of industries.  The case is captioned, CliftonSandifer, et al. v. United States Steel Corporation.  Check back for updates as this case progresses.

More on raising the minimum wage

The following excerpt from the U.S. Department of Labor’s website (www.dol.gov) provides an excellent overview of some of the common objections to raising the minimum wage. While these are just one commenter’s views, it is important to keep an open dialogue and provide citizens with information on the subject.

The president's plan to raise the federal minimum wage will benefit 15 million American workers, and have a positive effect on the economy. Still, there are some common myths about raising the minimum wage. We checked in with our Chief Economist Jennifer Hunt on the following three myths:

Myth: Raising the minimum wage reduces employment. False Minimum wage increases have little or no adverse effect on employment as shown in independent studies from economists across the country. Additionally, a recent letter by leading economists including Lawrence Katz, Richard Freeman, Joseph Stiglitz and Laura Tyson points out that "[i]n recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum wage workers, even during times of weakness in the labor market.

Myth: Only part-time workers are paid the minimum wage? False Fifty-three percent of all minimum wage earners are full-time workers.

Myth: Raising the minimum wage will negatively affect teen employment. False Eighty-nine percent of those earning the minimum wage are 20 years of age or older, and studies have shown that minimum wage increases have had little or no adverse effect on teen employment.

Obama Calls for Minimum Wage Increase

During Tuesday night’s State of the Union address, President Obama made a call to Congress to raise the federal minimum wage from its current rate of $7.25/hour. Speaking emphatically regarding the current state of the low wage worker, the President said,

“We know our economy’s stronger when we reward an honest day’s work with honest wages. But today, a full-time worker making the minimum wage earns $14,500 a year. Even with the tax relief we’ve put in place, a family with two kids that earns the minimum wage still lives below the poverty line. That’s wrong. That’s why, since the last time this Congress raised the minimum wage, 19 states have chosen to bump theirs even higher. Tonight, let’s declare that, in the wealthiest nation on Earth, no one who works full time should have to live in poverty -- and raise the federal minimum wage to $9 an hour.”

Check back for updates on any congressional action taken in relation to the President’s challenge.

Chicago cracks down on wage theft

Arise Chicago, an organization focused on building partnerships between faith communities and workers in the Chicago area, successfully ushered in a new anti-wage theft ordinance which is to take effect this summer. The ordinance passed the City Council by unanimous vote. The ordinance allows the city to suspend or revoke a business license of businesses who violate the Illinois’ Wage Payment and Collection Act.

The Ordinance comes after a University of Illinois study finding wage theft rampant in Chicago car washes. http://www.wbez.org/news/study-wage-theft-rampant-chicago-car-washes-102562

Visit http://arisechicago.org/ for more information.

Minimum Wage Linked to Poverty Line - Proposed Legislation

On Monday January 14, 2013 a bill was introduced in the United States House of Representatives and referred to the Committee on Education and the Workforce proposing a change to the minimum wage guaranteed by the Fair Labor Standards Act.

The proposed bill would peg the minimum wage to a number that is sufficient to equal 115% of the federal poverty threshold for a family of two based upon an individual working 2080 hours per year. The minimum wage would be adjusted every four years to reflect any change in the poverty threshold. Recent statistics (from 2011) show the federal poverty threshold for a family of two to be $15,504. If the bill were passed as written, using the new formula, the minimum wage would increase from $7.25/hour to $8.57/hour.

A copy of the bill can be found here: http://www.govtrack.us/congress/bills/113/hr229/text

Check back in the coming months for updates on this bill as it attempts to make its way through Congress.

The FLSA on Appeal

Rule 68 Offers of Judgment - The Supreme Court of the United States is poised to issue a decision on whether a Rule 68 Offer of Judgment moots an FLSA class in its infancy. In December, the Court heard arguments in a case involving a registered nurse meal break case. Prior to moving for conditional certification, Genesis Healthcare propounded upon the plaintiff an offer of judgment in an amount of her unpaid wages. Upon the offer not being accepted, Genesis Healthcare moved to dismiss the case. The District Court agreed and the Third Circuit reversed. You can listen to the arguments before the Supreme Court here as to whether an offer of judgment to a named plaintiffs in a collective action extinguishes the entire lawsuit.

http://www.supremecourt.gov/oral_arguments/argument_audio_detail.aspx?argument=11-1059

It should be noted that the collective action mechanism is of great importance to victims of wage theft. Allowing an employer to pick off employees who attempt to assert their rights is simply another wall put up between the victims of wage theft and their fair day’s pay.

Successor Liability – The Seventh Circuit Court of Appeals heard arguments last week on whether or not the common law doctrine of successor liability extends to claims brought under the FLSA. The Seventh Circuit, along with most other appellate courts, has applied the doctrine consistently avoid undercutting federally protected labor and employment rights when the assets of a business are sold. Under state law, normally an employer can sell their assets without any provision for liabilities – including those arising under a federal employment law – Title VII, ERISA, NLRA. However, federal courts have used a broader approach to successor liability to ensure victims of federally protected employment law are made whole in an effort to meet the Congressional intent. You can find the argument here.

www.ca7.uscourts.gov/fdocs/docs.fwx?submit=showbr&shofile=12-2440_001.mp3

Again, ensuring an employer make its employees whole through the doctrine of successor liability is a key to stopping wage theft.