Interaction with the CBA Exemption
One open question was whether this new interpretation would impact employers who are parties to a collective bargaining agreement. While the daily overtime statute contains an exemption for “employees who are represented by a labor organization for purposes of collective bargaining with their employer,” BOLI’s Technical Assistance states that “a valid collective bargaining agreement may set aside the provisions of ORS 652.020.” While the language used by Technical Assistance could be clearer, BOLI has confirmed that the collective bargaining exemption is unchanged under the new interpretation.
Scope of Definition of “Manufacturing Establishment”
What is still unclear is the extent of the reach (for BOLI enforcement purposes) of the definition of “mill, factory, or manufacturing establishment.” The pending court case at the center of the overtime dispute involves a commercial bakery, Portland Specialty Baking. Most would not consider a bakery to fall into one of these three classifications. An expansive reading opens the door for additional enforcement actions against unsuspecting employers engaged in businesses that are not typically considered to be a mill, factory, or manufacturing establishment.
While a claim for unpaid overtime can go back two years, BOLI’s Wage and Hour Division has stated that it will only apply the new interpretation to time worked on or after January 1, 2017, and it will not seek to apply the new interpretation prior to that date. However, employees may still choose to pursue a private right of action including on time worked prior to January 1, 2017.
BOLI’s Frequently Asked Questions page regarding manufacturing establishments now includes revised examples showing how to calculate how much is owed to employees working both daily and weekly overtime in the same workweek. In short, employers should pay the regular rate on all hours worked, plus half the regular rate on all daily overtime hours worked, as well as half the regular rate on all weekly overtime hours worked.
The Portland Specialty Baking case is still being litigated and a decision could create even more changes in the world of overtime. Additionally, we could see a legislative fix out of Salem this session. Accordingly, employers should keep a close eye on this issue and, in the meantime, consider eliminating situations where employees work both daily and weekly overtime in the same workweek. In situations where this can’t be avoided, employers should check whether a collective bargaining agreement may include an exemption and review overtime pay practices and policies to confirm that employees are paid in accordance with BOLI’s new interpretation.
We will keep you updated on any additional developments.
Electronic Alerts are written by Barran Liebman attorneys for their clients and friends. Alerts are not intended as legal advice, but as employment law, labor law, and employee benefits announcements. If this has been forwarded to you, and you would like to begin receiving Electronic Alerts directly, please email or call Traci Ray at 503-276-2115. Copyright ©2017 by Barran Liebman LLP.
Las Alertas electrónicas son escritas por abogados de Barran Liebman para sus clientes y amigos. Las Alertas no son proveídas como asesoramiento legal, sino solo como anuncios de leyes de empleo, leyes laborales y beneficios de empleo. Si esto ha sido remetido a usted y quisieras empezar a recibir las Alertas directamente, por favor mándanos un correo electrónico o llama a Traci Ray al 503-276-2115. Derechos de autor ©2017 por Barran Liebman LLP.