There is a great CNN Money article that goes over the pro’s and con’s of the new overtime rules passed by congress.
What makes this particular legislation so interesting is that it’s aimed squarely at the professional individual contributor population in the lower paid states. Let’s be real here, you can be a secretary in New York City and make well in excess of the high end of the legislation. Yet there is a massive chunk of Professional Individual Contributors in the world who are paid under 50K. I won’t go through all of the different elements of the rules and the ramifications for the employer and employee as the article does a good job, but in reading it I was struck by two points based upon my experience with federal workforce legislation. So my commentary is a little different. Disclaimer, I have not read theis particular legislation but I have read federal legislation and the rules associated with it, so I am familiar with the reality of the legislative system.
Their are two elements to keep in mind. The first element is that federal legislation is generally written to be flexible as a matter of course. This gives the court system and the rule making bodies the ability to be responsive to the evolving environment over time. There is a reason why the phrase “it takes an act of congress” has become part of the popular culture to mean it’s extraordinarily difficult to change something. The negative side of this means that there is tremendous wiggle room for employers and enforcement officials.
The second problem is that most organizations that have any sort of professional individual contributors, will have a large chunk who have flexibility in there jobs. In fact a tremendous amount of the salespeople in the world fall into this category. Think about all the small auto dealers with F&I managers in well over 60 hours a week. What about the CAD/CAM guy who works from home at nights? Professionals tend to be project based, and projects don’t punch a timeclock, which is why annual salaries even exist.
It’s these two problems added together that will create even more complexity for PIC’s over the coming years. Organizations and their HR teams will not know what to do. They will try and be safe as possible, so that means officially the professional will have to make it look like there is only 40 hours on the books. They will of course have to get their job or project completed to the unrealistic standards that are always demanded of the professional class. Caustic Corporate Competition will not go away and the trickel down demands of the management teams will still continue to flow. That pressure to perform will not go away and the commensurate hours over 40 will not go away either. There will be more hoops to jump through, and more complexity to the day.
Putting in over 40 hours a week used to be a way that a professional individual contributor could communicate to their company that they were serious and worthy of keeping through the next right sizing. Now the PIC has to do it, but do it in a way that everyone knows, but can’t be proved.
The ways companies choose to handle this new operating environment will be interesting to watch, interesting indeed. Just don’t do it on the clock.
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