Legislature(1999 - 2000)
03/29/1999 03:25 PM House L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
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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