Authored by Jessica Schauer
The House Committee on Education and the Workforce Subcommittee on Workforce Protections, chaired by Rep. Tim Walberg (R-MI), held a hearing today entitled, “The Fair Labor Standards Act: Is It Meeting the Needs of the Twenty-First Century Workplace?” The Subcommittee, which has oversight of laws affecting American workers, scheduled Thursday’s hearing as the first in a series of discussions on the FLSA and the ways in which it should be revised to better serve both employers and employees in the modern economy.
Richard L. Alfred, Chair of Seyfarth Shaw’s Labor and Employment Department’s National Wage & Hour Litigation Practice Group, was the only management-side attorney invited by the Subcommittee to testify. His oral and written testimony focused on the explosion of FLSA cases – particularly those brought as class and collective actions – in the past ten years, and the need to clarify employers’ obligations under the FLSA in order to increase compliance and decrease the burdensome litigation that currently plagues even the best-intentioned employers.
J. Randall MacDonald, Senior Vice President, Human Resources for IBM and Nobumichi Hara, Senior Vice President of Human Capital for Goodwill of Central Arizona, testified regarding their companies’ experiences in attempting to comply with the FLSA. Both witnesses stated that fear of lawsuits prevents employers from permitting their non-exempt employees from taking advantage of alternative work schedules or telecommuting opportunities. MacDonald also discussed IBM’s voluntary reclassification of 7,000 of its highly educated computer employees as non-exempt due to ambiguity in the computer professional exemption, pointing out that nearly 50% of the reclassified employees contested the company’s decision. Judy Conti, Federal Advocacy Coordinator for the National Employment Law Project, an organization that advocates for low income and unemployed workers, also testified, disagreeing with the other panelists and arguing that the FLSA is “elegant in its simplicity” but that greater enforcement is needed.
Chairman Walberg closed the hearing by noting that the FLSA should be modernized to make it clearer and more fair to both employees and employers, as well as to allow U.S. companies better flexibility to “innovate to the top.” In addition to Chairman Walberg, subcommittee members who attended included Ranking Member Lynn Woolsey (D-CA), Rep. John Kline (R-MN), Rep. Larry Bucshon, (R-IN), Rep. Donald Payne (D-NJ), Rep. Dennis Kucinich (D-OH), and Rep. Mazie Hirono (D-HI). Although Rep. Woolsey took issue with Chairman Walberg and several of the witnesses’ characterization of the FLSA as ambiguous and outdated, she also expressed a strong desire to work with Republican members of the Subcommittee with respect to another proposed FLSA amendment concerning independent contractor classification that she plans to introduce.