Legislature(1993 - 1994)
02/22/1994 03:00 PM House L&C
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 459 - DAMAGES & ATTY FEES FOR UNPAID WAGES REP. ELDON MULDER explained that HB 459 attempts to correct a provision in statute which pertains to wage and hour. Recently, an interpretation by the court posed a problem with liquidated damages. Rep. Mulder went on to explain that when there is a dispute regarding underpaid or unpaid overtime compensation, liquidated damages double the amount in dispute. This is over what the federal law provides. REP. MULDER stated that our statutes were interpreted to mean that disputes could be handled by either the Department of Labor or administratively between the individual making the claim and the employer, out of court for less than liquidated damages. REP. MULDER said in the Kinney Shoe case, the court interpreted the statute to read differently then what was being done. The court ruled that no case could be settled for less than liquidated damages. Rep. Mulder contends this was not what the legislature intended and HB 459 would correct and clarify this situation. Number 100 CHAIRMAN HUDSON noted the Department of Labor supported HB 459, but offered a suggestion to expand the definition of good faith to include affirmative action taken by the employer to comply with state law. The department also wants section 4, regarding the retroactivity provision. REP. MULDER explained that the issue is basically how do you interpret good faith. As it stands now, the court may award less than liquidated damages if it believes the employer legitimately was unaware of the underpaid or unpaid compensations. REP. MULDER stated the reason the definition of good faith has not been expanded at this time is because there are precedent setting cases that have determined what good faith means, and to expand the definition may cloud the issue. REP. MULDER responded to the Department of Labor's other concern by saying the provision in HB 459 regarding retroactivity was put in to make a level playing field from before the pre-Kinney shoe case to post-Kinney. It was never the intent of this bill to be overly punitive. Number 185 PERRY GROVER, Labor Relations Attorney, testified in support of HB 459. He noted the Alaska Wage and Hour Act is patterned after the Federal Fair Labor Standards Act. Alaska mandates liquidated damages, but federal law and most other states allow a very narrow exception that an employer can show it acted in good faith and reasonably believed the position was not subject to overtime. The court could then use its discretion not to award liquidated damages. MR. GROVER believes that HB 459 will leave liquidated damages as a penalty, but will allow employers the exception of good faith. MR. GROVER commented that HB 459 would also reinstate the authority with the commissioner of Labor, to waive liquidated damages if he sees fit. This was the case prior to the Kinney Shoe case but not after. MR. GROVER believes that subsection (f) will undue the part of the Kinney Shoe case where the Supreme Court said that private settlements are void. MR. GROVER stated the intention of the drafters of this bill regarding good faith was to use the same standards the federal government and other states have been using. He feels if Alaska uses any other language than the federal government, it would just encourage lawsuits. MR. GROVER said the reason the effective date was broken into two operative provisions is because the commissioner of Labor wanted section 3(e) to become effective on the effective date of the Act. The other provisions provide for any cases that are pending to use these new standards clarified by HB 459. Number 372 REP. JOE GREEN asked what the section on reasonable attorneys fees meant. MR. GROVER responded that reasonable attorney fees would be determined under Alaska Court Rule 82. Number 400 BRUCE WEYRAUCH, Attorney, Faulkner, Banfield, Doogan & Holmes, mentioned his concerns regarding HB 459. Mr. Weyrauch stated that Alaska is unique in its huge seasonal workforce. Those companies and businesses that come in to the state to do work on a seasonal basis generally don't pay as much attention to our laws as those companies who stay here. Number 440 MR. WEYRAUCH stated the wage and hour laws were intended to be strictly enforced, and as the Supreme Court said in the Kinney Shoe case, very punitive in nature, if they are not followed. Number 450 MR. WEYRAUCH suggested an amendment to HB 459 that would avoid litigation and allow the Department of Labor to get involved in the front end of the issue. MR. WEYRAUCH suggested a second amendment to provide supervision by the commissioner of Labor of any payment of the unpaid minimum wages or the unpaid overtime in dispute. Number 477 RUPE ANDREWS, Volunteer, AARP, expressed his concern that HB 459 did not provide any supervision of wage and hour settlements to protect senior citizens. Number 490 CHAIRMAN HUDSON asked if there were any kinds of protection in current law for seniors. Number 496 MR. WEYRUACH answered no. REP. MULDER asked Mr. Grover to respond to the points just made. Number 510 MR. GROVER disagreed with Mr. Weyrauch's testimony. He believes even attorneys in the field of labor law disagree sometimes on the issues, and that employers who in good faith have not paid overtime are assessed liquidated damages. MR. GROVER noted that private settlements are allowed in all other areas of law, but wage and hour cases. Number 550 REP. MULDER stated that section (f) of the bill is the guts of the bill that allows for private settlements. Number 572 REP. BRIAN PORTER stated he does not support amendments. Number 586 CHAIRMAN HUDSON asked if the federal law provides any extra assurances for anyone of advanced age. MR. GROVER stated the law did not distinguish by age. Number 600 CHAIRMAN HUDSON asked if there was anything in the revised law that would prevent seniors from receiving equal treatment. MR. GROVER answered no. Number 613 REP. MULDER said, senior citizens are not asking to be treated differently than anyone else. He added that any individual that felt they had been cheated, should talk to the Department of Labor. REP. JOE SITTON stated the Department of Labor has added a wage and hour position in the Governor's budget. CHAIRMAN HUDSON responded that the position referenced was not in the fiscal note attached to this bill, so it was apparently for other uses. TAPE 94-14, SIDE B Number 001 REP. MULDER stated that section 4 is arbitrary, but it would allow those cases that were started to be affected by HB 459 retroactively. Number 020 REP. PORTER stated he supports this retroactive clause in section 4 because it allows more cases the option of a private settlement, which in turn would free up the court system. Number 041 REP. BILL WILLIAMS moved that HB 459 be passed out of committee with individual recommendations and a zero fiscal note. There were no objections.
| Document Name | Date/Time | Subjects |
|---|