|Posted:||January 4, 2021 12:59 PM|
|From:||Senator Lisa Baker|
|To:||All Senate members|
|Subject:||Creating Consistency Between Federal and State Wage and Hour Regulations|
|In the near future, I plan to reintroduce legislation to modernize and simplify the Pennsylvania Minimum Wage Act of 1968 (PMWA) by eliminating a long-standing problem for Pennsylvania employers – confusing and unnecessary differences between state and federal law regarding certain wage and hour requirements.
The federal Fair Labor Standards Act (FLSA) and the regulations promulgated under it have been revised numerous times over the years, providing extensive guidance to employers regarding wage and hour issues. Pennsylvania has not kept pace with these changes, causing employers to struggle with the compliance gap that exists between state and federal law.
For example, in 1968, the federal Department of Labor (DOL) published a comprehensive guide with respect to the application of certain overtime pay requirements under the FLSA. Among other provisions, the guide specifically approved a concept called the fluctuating work week. Likewise, the Pennsylvania Department of Labor & Industry (PA L&I) was of the opinion that, without regulations to the contrary, Pennsylvania employers were in fact entitled to utilize this concept. Unfortunately, this interpretation from PA L&I was never codified into law nor was it incorporated into regulation. As a result, litigation recently reached the Pennsylvania Supreme Court which sought to clarify whether employers could utilize the fluctuating work week concept in Pennsylvania. Despite the federal guidance and despite the established position of the PA L&I, the court held that the Department’s “silence” about whether the PMWA aligned with the FLSA with respect to the calculation of overtime should be viewed as an “intent to reject” the federal method. Incredibly, therefore, the fluctuating workweek is now not permitted.
Unfortunately, there are numerous other examples where the federal FLSA regulations differ from Pennsylvania’s because of the voluminous nature of the federal regulations versus the paucity of state regulations. Needless to say, this lack of guidance in Pennsylvania has put our businesses at a competitive disadvantage.
My bill would bring stability and predictability to these issues by aligning the provisions of the PMWA with the FLSA. More specifically, it proposes that state law related to overtime would be interpreted in accordance with federal law, and the regulations and interpretations contained in the DOL’s Field Operations Handbook, while continuing to allow the state legislature to determine when a different approach should apply.
Pennsylvania would be joining 22 other states and the District of Columbia, which have already incorporated in full or in part the FLSA, or its implementing regulations, by reference into their statutes or regulations or by providing that state law does not apply to individuals covered by the FLSA. Additionally, this approach was advocated by numerous testifiers during a joint hearing of the Senate Appropriations Committee and the Senate Labor and Industry Committee held in 2016.
More recently, the Wolf Administration has acknowledged the benefit of consistency between federal and state law. In a June 2018 notice of proposed rulemaking, the PA L&I sought to amend a portion of its regulations with a laudable goal in mind: “the proposed amendments would align …[state law] with the federal regulations in effect since 2004” and make state law on this subject “consistent” with FLSA regulations. Unfortunately, the final regulations adopted did not in fact accomplish this stated goal.
Last Session, this measure was introduced as SB 762 and was co-sponsored by Senators Gordner, Mensch, K. Ward and J. Ward.
The list of organizations in support of my bill includes the following:
Introduced as SB523