On Aug. 23, a new set of rules regulating overtime pay went into effect. How do the new Fair Labor Standards Act rules affect overtime pay for your reporters and other editorial folks? The answer, unfortunately, is that “it depends.” The rules are quite clear for administrative, sales and computer professionals, less clear for journalists, and absolutely ironclad for blue-collar workers.

Who’s covered by the new overtime rules?

First, the Department of Labor’s FairPay Overtime Initiative does not apply to “enterprises” in “commerce” that gross under $500,000 annually in revenues. So if a newspaper’s gross revenues are small enough, it may not be required to pay overtime to any employee who works more than 40 hours a week.

However, raise a question if your small newspaper is incorporated separately, but owned by a parent corporation that grosses more than this. This category may be covered by the rules that affect the parent corporation..

Second, any employee earning less than $23,660 annually or $455 weekly MUST be paid for overtime, no matter their job skills or responsibilities. Owners of companies are excepted from this rule.

Third, any employee earning more than $100,000 annually is exempt from the overtime if the employee directs the work of two or more people or if the employee performs office or non-manual work. Note that the employer may, under defined circumstances, bring the employee’s pay up to the $100,000 mark by paying a lump sum before or shortly after the end of a 52-week period, in order to avoid making overtime payments.

Categories of Work

As has always been the case, some workers are classified as exempt, meaning they are not entitled to overtime no matter how many hours a week they work, and others are classified as non-exempt, meaning they must be paid overtime when they work more than 40 hours in a week.

Journalists: There is no clear-cut status for all journalists. If the news person collects and writes “standard recounts of public information by gathering facts on routine community events,” and if the person’s work is tightly supervised by their employer, that person must be paid overtime for work done over 40 hours in any week. If the news person is called on for investigative reporting, analysis or commentary on public events, that person may qualify as a “professional” and may be exempt from the requirement to pay overtime. This duties test for professional journalists is the same as it was under the previous rules, but it is difficult to apply to editorial staffers who perform a range of duties, as is likely to be the case with AAN members. The safest course of action is to pay overtime to anyone who performs any “routine duties,” even though this may not be the most economical approach. Remember, “routine” does not mean repeated duties. “Routine” means day-to-day reporting of news events.

Administrative Staff: This category includes anyone who performs office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers, and exercises discretion and independent judgment with respect to matters of significance. Again, this definition is the same as it was under previous rules. Notice that someone called “secretary” can fall into either category. One who is preparing documents and filing must be paid for overtime. One who is an administrator/office manager in a management office, handling decisions independently, is at least arguably exempt.

Sales Staff: The salary thresholds for those making less than $23,660 or more than $100,000 do not apply in this job category. At a newspaper, anyone whose primary duty is to sell advertising and who is customarily and regularly engaged away from the employer’s place or places of business in performing such primary duty can be exempt from overtime pay. This means the person is out on the street more than occasionally, but not necessarily all of the time, for work that is normally done every week. Outside sales do not include sales made by mail, telephone or the Internet unless such contact is just follow-up or preparation for personal visits. Because of the way they conduct their business, classified ad sales people are not likely to be exempt from the requirement to pay for overtime.

Computer Programmers: People who are doing sophisticated computer work that requires knowledge of programming are likely to be exempt from overtime pay. This includes systems analysts, programmers, software engineers or other similarly skilled workers. The ultimate test is whether the employee’s work is primarily:

• applying systems analysis techniques and procedures, including consulting with users to determine hardware, software or system functional specifications;
• designing, testing or modifying computer systems or programs, including prototypes, based on and related to user or system design specifications;
• designing, testing or modifying computer programs related to machine operating systems.

People who are merely using a computer software program such as Adobe, Word, Photoshop and the like are not exempt and should be eligible for overtime pay, unless some other exemption applies.

Blue Collar Workers: Anyone who is doing manual labor, including janitors, cleaning crews, press operators, construction workers and the like, is eligible for overtime pay. There are no exceptions, no matter how much they make. However, managers who engage in manual labor may be exempt.

Deductions

The employer can deduct money from an employee’s pay without losing the person’s exempt status if the employee

• is absent from work for personal reasons for at least one full day;
• is absent from work for medical reasons for more than one full day, provided this is consistent with a plan that provides sick pay for employees;
• has received pay for jury duty, military duty or witness fees;
• takes unpaid leave under the Family and Medical Leave Act, e.g., for maternity leave.

In other words, even if the deduction reduces the employee’s pay to an amount less than $455 a week, if the person is otherwise exempt from the requirement to pay overtime, these deductions will not trigger a requirement to pay overtime.

Requirement to Post and Circulate a Clear Policy

To protect themselves in the event of disputes over whether someone is entitled to overtime pay, employers should circulate a memorandum reminding people of the new threshold amounts. Explain how employees can bring apparent errors to the publisher’s (or supervisor’s) attention. State that it is the publisher’s policy to reimburse for improper deductions and to comply with the Fair Labor Standards Act. Click here for a model policy from the U.S. Department of Labor.

Having a clear policy in place and giving employees a chance to familiarize themselves with the policy may provide employers with “safe harbor” should they fail to properly pay overtime when it is due.

The U.S. Department of Labor Web site also has explanations of the overtime pay rules, though some are written in a way that doesn’t give clear answers to questions. Some of the information, however, may be useful. A fact sheet relied on here specifically addresses journalists. Online video training seminars are also offered.

© Alice Neff Lucan 2004

Alice Neff Lucan provides confidential advice on newsroom issues through Newslaw™, a hotline provided by AAN exclusively for its members.