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House Passes Divisive “Working Families Flexibility Act” to Amend FLSA

On May 2, 2017, the Republican-majority U.S. House of Representatives passed H.R. 1180, or the “Working Families Flexibility Act.” The bill, which will now move to the U.S. Senate for consideration, would amend the Fair Labor Standards Act (FLSA) to enable employers to offer employees accrued paid time off for overtime hours worked, in place of cash wages.

The act would amend § 207 of the FLSA to add a provision stating that “[a]n employee may receive, […] in lieu of monetary overtime compensation, compensatory time off at a rate not less than one and one-half hours for each hour of employment for which overtime compensation is required.” In other words, the law would allow employees to choose between receiving overtime premium pay and accruing compensatory time off, or “comp time,” for any hours worked over 40 in a work week. According to the terms of the bill, employers cannot force employees to accrue comp time rather than receive overtime pay, and the employer and employee must enter into a written agreement in order for the employee to use the comp time option. Employees’ accrued comp time would be capped at 160 hours, which the employee would be allowed to cash out for its monetary value at any time, and employers would be required to pay employees the cash value of any unused time at the end of the year.

Proponents of the amendment have argued that it would provide workers with greater freedom and is a response to an evolving need for more flexible work schedules in American workplaces. The Republican-led House Committee on Education and the Workforce called the bill “pro-worker” and “pro-family” and said that it would “modernize the law and better meet the needs of the 21st century workforce.” Republican House Representative Virginia Foxx, who serves as chair of the Committee on Education and the Workforce, claimed that workers are hampered by what she described as the FLSA’s “[o]utdated federal rules that demand rigid work schedules” and stated that these wage-and-hour standards are “making it more difficult for workers to find the flexibility they need.”

However, many have raised concerns that—far from giving workers better choices and more flexibility—the bill will have negative effects for workers, resulting in longer hours and less pay. Opponents fear that employers will be more likely to assign overtime work to employees who elect to accrue comp time, rather than receive overtime pay; consequently, employees who choose comp time could end up working long hours, while employees who prefer or rely on overtime pay are unable to get overtime hours. Though the act mandates that an employee’s participation in the comp time option be voluntary, employers may pressure employees into choosing accrued comp time, rather than overtime wages, so that the employer can cut costs—even if an employee would rather receive overtime compensation.

Democratic House Representative Bobby Scott also notes that the bill “doesn’t give employees any rights they don’t already have”; instead, it effectively requires workers to choose between earning the overtime wages to which the FLSA entitles them, or having more paid time off from work. Moreover, there’s no guarantee that workers will be able to use all of their accrued time off. The act requires employees to use comp time “within a reasonable period after making the request if the use of the compensatory time does not unduly disrupt the operations of the employer,” which gives employers a wide degree of latitude in deciding whether to grant comp time requests, and employers can decide—without employee input—to give an employee the cash value of as much as half of the employee’s earned comp time, rather than allowing the employee to actually take that time off from work.

If your employer has violated your rights under wage-and-hour laws, including denying you overtime pay or leave to which you are legally entitled, contact The Harman Firm, LLP.

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