Legislature(1999 - 2000)

03/29/1999 03:25 PM House L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                                                                                
HB 61 - OVERTIME WAGE EXEMPTION AIRLINE EMPLOYEES                                                                               
                                                                                                                                
Number 1183                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG announced the committee's next order of business                                                              
is HB 61, "An Act relating to an exemption from the requirement for                                                             
payment for overtime under a voluntary written agreement for                                                                    
certain employees in the airline industry; and providing for an                                                                 
effective date."  He invited the sponsor's representative forward.                                                              
                                                                                                                                
Number 1195                                                                                                                     
                                                                                                                                
JONATHON LACK, Legislative Assistant to Representative Andrew                                                                   
Halcro, Alaska State Legislature, came forward to present HB 61.                                                                
He noted Representative Halcro is offering HB 61, which was                                                                     
introduced the previous legislative session as HB 389.  House Bill                                                              
389 moved out of the House Labor and Commerce Standing Committee                                                                
but did not make it to the House floor because it was introduced                                                                
late in the session.  Mr. Lack explained HB 61 is intended to allow                                                             
airline employees to trade workdays with each other without                                                                     
invoking overtime pay requirements for their employers.  Under                                                                  
current Alaska Statute, a substitute employee who works a shift for                                                             
another employee must be paid overtime if that substitute employee                                                              
has already worked 8 hours in the same workday or 40 hours in the                                                               
same workweek.  Employees currently enjoy shift-trading so they can                                                             
attend special events for their children, take longer weekend                                                                   
trips, and travel.  This legislation is necessary because Alaska is                                                             
the only western state with a daily overtime requirement.                                                                       
Shift-trading is very common nationwide throughout the airline                                                                  
industry.  Usually it is done informally, with the employer's tacit                                                             
approval, and HB 61 would legitimize the custom in the industry.                                                                
Mr. Lack, noting the committee was running short on time, made                                                                  
himself available for questions and said Michelle Buckmaster is                                                                 
also available in Anchorage to testify in favor of the legislation.                                                             
                                                                                                                                
CHAIRMAN ROKEBERG asked Mr. Lack to quickly list for the record the                                                             
letters of support for the legislation in the bill packet.                                                                      
                                                                                                                                
Number 1288                                                                                                                     
                                                                                                                                
MR. LACK commented there are letters of support from Alaska                                                                     
Airlines, ERA Aviation and the Alaska Air Carriers Association, as                                                              
well as a resolution of support from the Alaska Air Carriers                                                                    
Association.  There is a letter of support for the previous                                                                     
session's HB 389 from Peninsula Airways, Incorporated [d.b.a.                                                                   
PenAir].  There are letters of support from a number of airline                                                                 
employees.  Mr. Lack said the bill packet also contains petition                                                                
format support forms from various airline employees including ERA                                                               
Aviation, United Airlines counter and airfreight staff, United                                                                  
Airlines ramp agents, and Delta Airlines.                                                                                       
                                                                                                                                
REPRESENTATIVE HARRIS asked Mr. Lack if they had received any                                                                   
comments from the Department of Labor.                                                                                          
                                                                                                                                
Number 1379                                                                                                                     
                                                                                                                                
MR. LACK noted Mr. Perkins [Deputy Commissioner, Department of                                                                  
Labor] had been present earlier but had to leave to attend a                                                                    
"Finance Subcommittee" meeting.  Mr. Lack said Mr. Perkins has                                                                  
indicated the department and the Administration do not oppose the                                                               
intent of this legislation as written.                                                                                          
                                                                                                                                
REPRESENTATIVE MURKOWSKI commented a couple of the letters in the                                                               
packet are in support but they express the desire that the flexible                                                             
work hour be included.  She questioned, "I notice that it                                                                       
specifically does not include, and that's why you're asking for                                                                 
this additional exemption.  What's going on there?"                                                                             
                                                                                                                                
MR. LACK indicated he thinks there possibly may have just been a                                                                
misunderstanding and that is why the letters include flexible work                                                              
hour.  He noted the state of Alaska already has provision for                                                                   
people to work four 10-hour shifts for their employers.  They                                                                   
simply have to sign up for that and it has to be approved by the                                                                
Department of Labor.  The legislation before the committee would                                                                
allow shift trading within the same work period, either an 8-hour                                                               
period or a 40-hour workweek.  Mr. Lack stated he believes this is                                                              
what the letter's authors are speaking of when they talk about                                                                  
flexible shifts.                                                                                                                
                                                                                                                                
Number 1449                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI said, then, the exemptions set out in                                                                  
subsections (13) and (14) in statute [AS 23.10.060(d)] do not                                                                   
currently cover the miscellaneous airline employees.                                                                            
                                                                                                                                
MR. LACK answered no, they do not.                                                                                              
                                                                                                                                
REPRESENTATIVE MURKOWSKI asked why.                                                                                             
                                                                                                                                
MR. LACK indicated he does not know, he has been told by                                                                        
legislative counsel that those exemptions do not cover these                                                                    
employees.                                                                                                                      
                                                                                                                                
CHAIRMAN ROKEBERG questioned if it has anything to do with whether                                                              
they are under a labor agreement.                                                                                               
                                                                                                                                
REPRESENTATIVE MURKOWSKI reviewed subsections (13) and (14).  [AS                                                               
23.10.060(d)(13) and (14) read:                                                                                                 
                                                                                                                                
          (13) work performed by an employee under a flexible                                                                   
     work hour plan if the plan is included as part of a                                                                        
     collective bargaining agreement;                                                                                           
          (14) work performed by an employee under a voluntary                                                                  
     flexible work hour plan if                                                                                                 
               (A) the employee and the employer have signed                                                                    
     a written agreement and the written agreement has been                                                                     
     filed with the department; and                                                                                             
               (B) the department has issued a certificate                                                                      
     approving the plan that states the work is for 40 hours                                                                    
     a week and not more than 10 hours a day; for work over 40                                                                  
     hours a week or 10 hours a day under a flexible work hour                                                                  
     plan not included as part of a collective bargaining                                                                       
     agreement, compensation at the rate of one and one-half                                                                    
     times the regular rate of pay shall be paid for the                                                                        
     overtime;]                                                                                                                 
                                                                                                                                
Number 1515                                                                                                                     
                                                                                                                                
MR. LACK indicated he understands it is currently possible for the                                                              
employee and the union to negotiate whether or not to have flexible                                                             
time rules.  He noted that is allowed, but non-union airlines do                                                                
not have this luxury because they're not part of a collective                                                                   
bargaining agreement.                                                                                                           
                                                                                                                                
CHAIRMAN ROKEBERG said he remembers this provision very well,                                                                   
stating, "That is, if you have a collective bargaining (indisc.) if                                                             
you have a flex-work plan that's already bargained for -- but if                                                                
not, you have to have an approved plan."  The chairman indicated                                                                
this is for a flexible work plan hour, normally providing for a                                                                 
four 10-hour day work week.  He noted it is a formalized process                                                                
which has to be approved.                                                                                                       
                                                                                                                                
REPRESENTATIVE HALCRO indicated the shift-trading practice has been                                                             
going on for a very long time.  The problem lies with Alaska's                                                                  
daily overtime requirement.  A lot of airlines have told their                                                                  
employees that they can't allow the employees to trade shifts until                                                             
this is resolved in statute and the airlines are protected.                                                                     
Representative Halcro noted a large part of working in the airline                                                              
industry is the ability to trade shifts.  He indicated this                                                                     
practice is done in every state and the legislation is just a means                                                             
of legitimizing the practice in Alaska.                                                                                         
                                                                                                                                
CHAIRMAN ROKEBERG announced the committee would take Ms.                                                                        
Buckmaster's testimony.                                                                                                         
                                                                                                                                
Number 1636                                                                                                                     
                                                                                                                                
MICHELLE BUCKMASTER testified via teleconference from Anchorage in                                                              
support of HB 61.  She spoke mainly from a prepared statement:                                                                  
                                                                                                                                
     "Mr. Chairman, members of the committee, ... I am a                                                                        
     customer service representative for United Airlines in                                                                     
     Anchorage, Alaska.  I am here on behalf of numerous                                                                        
     airline employees who are from various airlines here in                                                                    
     the state of Alaska.  I would like to thank you for                                                                        
     giving me the opportunity to give my testimony.                                                                            
     Unfortunately there may not be too many people here today                                                                  
     because of the short notice of this hearing, so I am                                                                       
     speaking on behalf of quite a few people.  I am here in                                                                    
     regard to HB 61, which I hope will be passed through ...                                                                   
     this legislation [legislature] this year.  As you are                                                                      
     aware, the states of Washington and Hawaii passed a                                                                        
     similar bill last year.                                                                                                    
                                                                                                                                
     "In May of 1997 United Airlines informed us employees in                                                                   
     Alaska that because of the labor laws in our state, the                                                                    
     trade policy in company regulations would no longer                                                                        
     pertain to us.  The trade policy is a significant benefit                                                                  
     to us as employees as well as all airline employees in                                                                     
     the state of Alaska.                                                                                                       
                                                                                                                                
     "The airline industry ... is an industry that spends 24                                                                    
     hours a day, 7 days a week, 52 weeks a year in promoting                                                                   
     and supporting the economic growth of our state through                                                                    
     tourism, conventions, sporting events and numerous other                                                                   
     activities.  The trade policy is a valuable benefit and                                                                    
     tool to its employees who would otherwise miss out on                                                                      
     precious time with their family, observance of religious                                                                   
     holidays, educational opportunities, summer vacations and                                                                  
     extra income for those who require it.                                                                                     
                                                                                                                                
     "In an industry where competition is always a priority,                                                                    
     as we know, we have come together to make a change that                                                                    
     will benefit and create a win-win situation for all                                                                        
     airline employees."                                                                                                        
                                                                                                                                
Number 1737                                                                                                                     
                                                                                                                                
     "Over the past two years employees from several airlines                                                                   
     have worked together to encourage implementation of this                                                                   
     bill.  As you are aware, last year [you] received                                                                          
     numerous phone calls and letters from concerned airline                                                                    
     employees; this still holds true today and the support is                                                                  
     here.  I faxed you Friday a (indisc.) petition I had sent                                                                  
     to airlines to have signed in support of this bill, just                                                                   
     to show you a little support this and that we still stand                                                                  
     behind our word.  Unfortunately today Doug Orcutt who                                                                      
     works for Alaska Airlines, the largest airline in Alaska,                                                                  
     has a previous engagement in Washington, D.C.  I talked                                                                    
     with him and he reassured me of the full support from                                                                      
     Alaska Airlines employees.  He is a ramp serviceman here                                                                   
     in Anchorage.  There has been a great deal of grassroots                                                                   
     support for this legislation.  I would like to remind you                                                                  
     that this is on a volunteer basis by employees, making                                                                     
     their own choice.  This will not invoke overtime pay                                                                       
     requirements.  This will ... ["not" stated on tape and in                                                                  
     written statement] give individual workers the freedom to                                                                  
     schedule specific time off or to make extra earnings                                                                       
     without invoking overtime.  Therefore you will have                                                                        
     happier, more productive, more dedicated employees in a                                                                    
     highly traveled state."                                                                                                    
                                                                                                                                
     "To give you an example:  Employee A works 40 hours a                                                                      
     week, Friday/Saturday off.  Employee A would like to have                                                                  
     an extra day off, Thursday, so he can have a long weekend                                                                  
     fishing.  Employee B works 20 hours a week,                                                                                
     Wednesday/Thursday off.  He would like to work for                                                                         
     Employee A on Thursday to get the extra hours and money,                                                                   
     however he only receives straight-time pay on (indisc.)                                                                    
     volunteer basis.  If the company needs him to work extra                                                                   
     hours on (indisc.) day or his day off and he is eligible                                                                   
     for the overtime, then he would receive (indisc.) the                                                                      
     applicable overtime rate.  Let's not get confused that                                                                     
     the overtime that the company needs you to work is                                                                         
     (indisc.) totally separate issue (indisc.) assumption.                                                                     
     Another example is Employee B needs an extra day off.  He                                                                  
     needs Saturday, he is running the Mayors Marathon here in                                                                  
     Anchorage.  Employee A will work for him that Saturday on                                                                  
     a volunteer basis and only receives straight-time pay                                                                      
     even though he exceeds his forty hours in a work week                                                                      
     and/or 8 hours in a day, he only receives his                                                                              
     straight-time pay.  However, if his company needs him to                                                                   
     work the overtime or calls him in needs of his service,                                                                    
     he is eligible then for the applicable overtime rate.  As                                                                  
     you see this does not hurt anyone, the company or the                                                                      
     employee.  They both meet their needs.                                                                                     
                                                                                                                                
     "In closing, Mr. Chairman, members of the committee, we                                                                    
     understand and respect that the labor laws are here to                                                                     
     protect us.  However, this particular law which may be a                                                                   
     protection in your eyes has eliminated a benefit in ours                                                                   
     here in Alaska.  Therefore, here I am on behalf of these                                                                   
     employees to request the amendment we have brought before                                                                  
     you not only be passed, but in a timely manner be passed.                                                                  
     This is a very valuable benefit to us, and throughout the                                                                  
     country with United Airlines as well as many other                                                                         
     airlines.  I am here again to support HB 61 along with                                                                     
     several other airline employees.  Thank you again for                                                                      
     your time."                                                                                                                
                                                                                                                                
Number 1946                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG stated the committee appreciated Ms. Buckmaster's                                                             
efforts.  He invited Mr. Perkins forward.                                                                                       
                                                                                                                                
Number 1978                                                                                                                     
                                                                                                                                
DWIGHT PERKINS, Deputy Commissioner, Department of Labor, came                                                                  
forward to testify on HB 61.  He noted the department has                                                                       
historically opposed these types of legislation because the                                                                     
department feels they weaken overtime requirements for employers.                                                               
However, Mr. Perkins indicated the department feels HB 61's                                                                     
voluntary written agreement between the employer and employee                                                                   
provides a safeguard for the employee against being coerced by the                                                              
employer to voluntarily work when the employee really does not want                                                             
to.  The benefits the employees received from the airlines kind of                                                              
make up for "the sometimes pay that they may not receive on the                                                                 
paycheck," so this is a benefit the employees would lose if this is                                                             
not changed.  Mr. Perkins also indicated the employers do have a                                                                
possibly strong liability out there and the department understands                                                              
the employers' need and desire to add this exemption.  He stated                                                                
the department does not oppose this legislation.                                                                                
                                                                                                                                
CHAIRMAN ROKEBERG commented to Mr. Perkins there is also a possible                                                             
CS [labeled 1-LS0335\G, Cramer, 3/19/99] which deletes the written                                                              
contract.  He asked for the department's position on this CS.                                                                   
                                                                                                                                
Number 2160                                                                                                                     
                                                                                                                                
MR. PERKINS answered the department supports HB 61, Version A, as                                                               
he has testified.  However, the department would have some concern,                                                             
and probably not be able to give its non-opposition to the bill, if                                                             
the CS was to be adopted.  The written agreement provides some sort                                                             
of safeguard for the employee and does ensure the employee                                                                      
voluntarily agreed to the shift change.  Mr. Perkins indicated he                                                               
thinks the employer would want to have that as well to protect them                                                             
against possible claims of unpaid overtime from an employee.                                                                    
                                                                                                                                
CHAIRMAN ROKEBERG asked, for the record, if the voluntary written                                                               
agreement would be between the employer and employee, and asked how                                                             
that would work as a practical matter regarding Department of Labor                                                             
enforcement.                                                                                                                    
                                                                                                                                
MR. PERKINS responded that if a wage claim was brought to the                                                                   
department, the department would ask the employer for supporting                                                                
documentation and the employer would produce the written agreement.                                                             
Mr. Perkins referred to subsection (d)(18)(D) of HB 61, which                                                                   
reads:                                                                                                                          
                                                                                                                                
     * Section 1.  AS 23.10.060(d) is amended by adding a new                                                                   
     paragraph to read:                                                                                                         
          (18) work performed by an employee under a voluntary                                                                  
     written agreement addressing the trading of work shifts                                                                    
     among employees if ...                                                                                                     
               (D) the trading agreement states that the                                                                        
     employee is not entitled to receive overtime for any                                                                       
     hours worked by the employee when the employee                                                                             
     voluntarily works those hours under a shift trading                                                                        
     practice under which the employee has the opportunity, in                                                                  
     the same or other work weeks, to reduce hours worked by                                                                    
     voluntarily offering a shift for trade or reassignment.                                                                    
                                                                                                                                
MR. PERKINS stated he believes it is a good safeguard for both                                                                  
employer and employee, and it is a workable solution.                                                                           
                                                                                                                                
NUMBER 2333                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG, confirming there were no questions for Mr.                                                                   
Perkins and that no one else wished to testify on HB 61, announced                                                              
the public hearing was closed.  The chairman commented he was                                                                   
familiar with the practice of shift trading from his work                                                                       
experience in 1966 and 1967 as a transportation agent for Northwest                                                             
Airlines and a customer service representative for Alaska Airlines.                                                             
He noted the practice is longstanding and has almost completely no                                                              
bearing on labor practices.  Chairman Rokeberg indicated HB 61                                                                  
merely legitimizes this customary practice.  He thanked organized                                                               
labor for not opposing the legislation and the Department of Labor                                                              
for its non-opposition.  The chairman indicated he wished Mr. Lack                                                              
to explain why the verbiage in subsection(18)(A) is necessary.  He                                                              
understands it, but wishes the explanation to be on the record.                                                                 
[Subsection (A) reads:                                                                                                          
                                                                                                                                
               (A) the employee is employed by an air carrier                                                                   
     subject to subchapter II of the Railway Labor Act (45                                                                      
     U.S.C. 181-188), including employment as a customer                                                                        
     service representative;]                                                                                                   
                                                                                                                                
Number 2486                                                                                                                     
                                                                                                                                
MR. LACK replied, "Mr. Chairman, to answer your question, the                                                                   
reason we -- it's put in the Railway Labor Act and defined as who                                                               
are ... employees of an air carrier under that Act is because the                                                               
Act specifically allow..."  [SOME TESTIMONY LOST DUE TO BRIEF TAPE                                                              
MALFUNCTION DURING TAPE CHANGE.  A REQUEST WAS MADE TO THE CHAIRMAN                                                             
TO RESTATE HIS QUESTION SO MR. LACK'S ANSWER COULD BE FULLY                                                                     
RECORDED.  A VERY BRIEF AT-EASE WAS TAKEN DURING THE TAPE                                                                       
MALFUNCTION.]                                                                                                                   
                                                                                                                                
TAPE 99-32, SIDE A                                                                                                              
Number 0001                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG stated, "For the record, could you answer why                                                                 
including employment as a customer service representative is                                                                    
stipulated in the bill."                                                                                                        
                                                                                                                                
MR. LACK answered, "Mr. Chairman, it is redundant including                                                                     
customer service representative.  However, because ... the federal                                                              
Railway Labor Act does include all employees of the air carrier                                                                 
unless they're involved in the mining of coal.  So it is redundant,                                                             
however there was some concern by people, apparently last year,                                                                 
that customer service agents might not be included under the                                                                    
federal Act."                                                                                                                   
                                                                                                                                
CHAIRMAN ROKEBERG confirmed Mr. Lack had read the minutes from the                                                              
last session.  The chairman recalled there had been a reason but                                                                
could not remember exactly why.  He asked Mr. Lack to follow up on                                                              
this with Representative John Cowdery [sponsor of the previous                                                                  
session's HB 389], noting the committee did not like to have                                                                    
surplus wordage and definitely wanted to avoid redundancy.                                                                      
                                                                                                                                
Number 0097                                                                                                                     
                                                                                                                                
REPRESENTATIVE HALCRO indicated the initial version of HB 389, the                                                              
bill introduced the previous session, did not contain that                                                                      
provision but the version brought back before the committee after                                                               
work with organized labor had that language added [Note:                                                                        
Representative Halcro's testimony mentioned the creation of "kind                                                               
of a work subcommittee" for HB 389; HB 389 was not formally                                                                     
assigned to a subcommittee].                                                                                                    
                                                                                                                                
CHAIRMAN ROKEBERG confirmed there was no further discussion.  He                                                                
indicated both he and Representative Halcro represent the area                                                                  
encompassing Anchorage International Airport and he does not think                                                              
this is a conflict of interest.  The chairman commented there are                                                               
some 10,000 jobs at that airport; the airport is very important to                                                              
the economy of Anchorage and the state of Alaska.                                                                               
                                                                                                                                
Number 0172                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI clarified that the sponsor had withdrawn                                                               
the possible CS.                                                                                                                
                                                                                                                                
CHAIRMAN ROKEBERG noted the written contract was being retained.                                                                
                                                                                                                                
Number 0206                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI made a motion to move HB 61 out of                                                                     
committee with the zero fiscal note and individual recommendations.                                                             
There being no objection, HB 61 moved out of the House Labor and                                                                
Commerce Standing Committee.                                                                                                    

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