Labor Gets Mixed News on Overtime

Organized labor’s drive to repeal the upcoming ban on daily overtime pay was approved by a friendly Senate committee Wednesday, but ran into a surprise roadblock in the Assembly.

The action on two fronts occurred as Gov. Pete Wilson’s office issued a fresh warning that if labor’s overtime bills reach his desk, he will probably veto them.

Anticipating such a veto, officials of the California Labor Federation, AFL-CIO, said they are considering submitting the issue to the voters as an initiative in November 1998, when a new governor also will be elected.

Under an order by the Wilson-appointed Industrial Welfare Commission, overtime pay for working more than eight hours a day will be repealed Jan. 1 and replaced by the federal rule requiring extra pay for work exceeding 40 hours a week.

Affected will be about 6 million employees, mainly part-timers who do not work 40 hours a week and are not covered by union contracts. Labor charges that the shift will result in a $1-billion annual pay cut, a claim that employer organizations deny as unsubstantiated.

In the Legislature, the two nearly identical labor-sponsored bills got mixed treatment Wednesday.

Over Republican opposition, the Senate Industrial Welfare Committee approved an Assembly-passed bill (AB 15) by Assemblyman Wally Knox (D-Los Angeles) on a 4-2 vote.

Later, the Senate version of the bill by Sen. Hilda Solis (D-El Monte) unexpectedly stalled in the Assembly Labor Committee when it became the victim of a hostile amendment. Rather than proceed, Solis asked for a postponement of at least a week.

Labor lobbyists said the setback in the Assembly was only temporary and predicted that the Solis bill (SB 680) would be approved without the hostile amendment.

The amendment, offered by Assemblywoman Diane Martinez (D-Monterey Park), would extend the eight-hour overtime provisions to farm workers, a group now excluded. By including them, the measure would lose other political support and probably die.

Each bill, the centerpiece of organized labor’s legislative program this session, is virtually certain to win approval of the Democratic-controlled Legislature.

The Wilson administration is fighting the legislation aggressively, and Wilson spokesman Steve Tatum renewed the veto warning Wednesday.

“The bills clearly conflict with the administration’s policy,” he said. He added that restoring daily overtime would make California employers less competitive with those in other states and discourage them from offering more flexible work schedules.

Employers who want to eliminate daily overtime argued that workers are demanding more flexible hours, especially to tend to urgent family matters.

But labor charged that the switch makes no accommodation for the child care needs of parents who could be ordered to work 12 hours or more a day without overtime compensation.

“Under the Industrial Welfare Commission’s order, a person could be required to work 24 hours a day without any overtime,” testified Tom Rankin, president of the labor federation. “There’s no longer any inhibition to work 12-, 15-, 20-hour days.”

But Sen. Ross Johnson (R-Irvine), a member of the Industrial Relations Committee, accused Knox and opponents of the 40-hour overtime week of using “excessive B.S. rhetoric.” He suggested there was no proof that “devastation” has occurred in the 47 other states that practice the 40-hour overtime rule.

Rankin later told a reporter that labor has a “concern” that elimination of the eight-hour overtime rule for nonunion workers will find its way to the collective bargaining table. He said the issue has already surfaced in cement worker and machinist union negotiations.

Action by the committees followed an announcement by labor, Solis and Knox that if their legislation fails, Democrats and union members intend to make restoration of the eight-hour overtime rule an election issue next year against Republicans.

In addition, Rankin and Art Polaski, executive secretary-treasurer of the California AFL-CIO, said they are studying putting the overtime issue on the ballot in 1998, as they successfully did last year with Proposition 210, which increased the minimum wage.

The minimum wage initiative was opposed by many of the same business and employer organizations who favor eliminating the daily overtime rule.

In the view of labor and Democrats, an overtime initiative would be a tough issue for Republican candidates, including those for governor and the Legislature.

Opponents of the Solis and Knox bills include major employer organizations such as the California Chamber of Commerce, California Manufacturers Assn., California Newspaper Publishers Assn. and California Restaurants Assn.

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BACKGROUND

The Industrial Welfare Commission voted in April to bring California overtime rules into alignment with those of the federal government and 47 other states by scrapping the daily overtime requirement, which requires businesses to pay overtime whenever employees put in more than eight hours in a single day. Instead, overtime would be paid only to eligible employees who work more than 40 hours in a week. The change was to have taken effect on July 1. California’s daily overtime rule dates to 1918, when the state ordered fruit and vegetable canning companies to pay time and a half to women and children for any time beyond eight hours in a given day. The aim was to prevent safety hazards and other problems resulting from overwork. Proponents say the change would increase workplace flexibility and give working parents more time to care for children. Opponents see the change as a way to force more hourly wage workers, particularly part-timers, to stay on the job for long hours against their will without receiving overtime pay.