Legislature(2005 - 2006)BELTZ 211

03/01/2005 01:30 PM Senate LABOR & COMMERCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Bills Previously Heard/Scheduled
Moved CSSB 105(L&C) Out of Committee
Moved SB 67 Out of Committee
             SB 105-OVERTIME WAGES FOR FLIGHT CREW                                                                          
CHAIR BUNDE announced SB 105 to be up for consideration.                                                                        
PETER  NOSEK,   Birch,  Horton,  Bittner  and   Cherot,  said  he                                                               
represented  Hageland pilots,  the  plaintiffs,  and advised  the                                                               
committee that  before the lawsuit  was filed, Mr.  Harms offered                                                               
to settle  and walk away  for $45,000. He  believed SB 105  has a                                                               
very  serious constitutional  problem. The  Alaska Supreme  Court                                                               
has recognized  that legal  claims are  property for  purposes of                                                               
the constitution. Since the time  claims were filed in 2002, long                                                               
before  the  flight   crew  exemption  was  passed  by  the   23                                                                
Legislature,  the Superior  Court had  already ruled  that pilots                                                               
were entitled to  overtime. To retroactively wipe  out rights the                                                               
court has already recognized would be a constitutional taking.                                                                  
SB  105 puts  into place  the Department  of Labor  and Workforce                                                               
Development  (DOLWD)  interpretation  of overtime  based  on  the                                                               
attorney  general's   letter,  which   says  that   air  carriers                                                               
operating  solely  instate  are  not  exempt  under  the  federal                                                               
Railway Labor  Act and that the  Alaska Wage and Hour  Act (AWHA)                                                               
applies to them.                                                                                                                
Before filing any claim, Mr. Nosek  said he wrote a letter to the                                                               
DOLWD  about  its position  on  pilots'  wages  in the  state  of                                                               
Alaska. The chief of the  Labor Standards Division replied saying                                                               
that he follows  the 1980 attorney general's  opinion saying that                                                               
air carriers operating solely in-state  are subject to AWHA. When                                                               
the  claim was  filed on  behalf  of the  pilots, the  department                                                               
recognized that  their employer  was subject to  the law  and the                                                               
claims were valid.                                                                                                              
MR. NOSEK claimed  that Hageland Aviation tried to  have the best                                                               
of both worlds. If  a pilot was late, he would  be docked pay; if                                                               
he  worked longer  than eight  hours, he  wasn't paid  extra. "To                                                               
have the  best of both worlds  is simply a violation  of the Wage                                                               
and Hour Act as it has been established."                                                                                       
MR.  NOSEK said  the law  was changed  in 2003  to exempt  flight                                                               
crews. That change provided the  protection the industry needs. A                                                               
claim can  only be filed for  two years and that  two-year window                                                               
is almost completely  closed. SB 105 is only about  the three air                                                               
carriers that  have been  subjected to  lawsuits. To  resolve the                                                               
constitutional  problem, he  suggested  an  amendment that  would                                                               
provide certainty  to the air  carrier industry,  protection that                                                               
air  carrier industry  seeks and  recognizes  the court  judgment                                                               
giving overtime rights solely to Hageland Aviation.                                                                             
     No other  lawsuit was  filed before  the change  in the                                                                    
     law.  No other  lawsuit  has had  a  judgment in  their                                                                    
     favor on the  right to overtime. By  simply amending SB
     105 to  say this doesn't apply,  if a court of  law has                                                                    
     recognized  in  summary  judgment  the  entitlement  to                                                                    
     overtime.  Then  the  air  carrier  industry  is  fully                                                                    
     protected   and  the   rights   of   those  pilots   as                                                                    
     established  by the  Superior  Court  are protected  as                                                                    
     well. While we believe there  are problems with SB 105,                                                                    
     we  believe it  could be  simply fixed  to protect  the                                                                    
     industry  as  well as  protect  those  pilots who  went                                                                    
     forward in good faith under the law before 2003.                                                                           
GREY MITCHELL,  Director, Labor Standards and  Safety, Department                                                               
of Labor  and Workforce Development (DOLWD),  said the department                                                               
has applied  a policy since 1980  that looks at two  factors. One                                                               
is whether  the air carrier  is interstate and whether  the pilot                                                               
is covered by a collective  bargaining agreement. Both are exempt                                                               
from the  Wage and Hour  Act under the department's  policy. Once                                                               
the  inter/intra-state issue  is  cleared  up, he  can  go on  to                                                               
further clarify whether an employee is subject to the law.                                                                      
1:42:55 PM                                                                                                                    
TOM  DANIEL, representing  Hageland  Aviation,  said Mr.  Nosek's                                                               
position is that  SB 105 doesn't enact DOLWD policy,  but it does                                                               
because of  the way the statute  that passed in 2002  was worded.                                                               
It only  applies effectively to  the interstate  carriers because                                                               
it only covers carriers that  are covered under the Railway Labor                                                               
Act.  Also, the  constitutional issue  in SB  105 could  be dealt                                                               
with  elsewhere,  but he  didn't  think  it presented  a  takings                                                               
problem, because  it's quite common  for the Legislature  to pass                                                               
legislation  on  pending legislation.  He  said  that SB  105  is                                                               
constitutional  and  implements  DOLWD  policy  as  it  has  been                                                               
followed for over 20 years.                                                                                                     
SENATOR ELLIS moved to adopt Amendment 1.                                                                                       
                      A M E N D M E N T 1                                                                                   
OFFERED IN THE SENATE                                                                                                           
     TO:  SB 105                                                                                                                
Page 1, line 13:                                                                                                                
     Delete "resolved"                                                                                                          
     Insert "determined"                                                                                                        
Page 1, line 14:                                                                                                                
     Delete "final"                                                                                                             
CHAIR BUNDE objected for an explanation.                                                                                        
SENATOR  ELLIS  said he  had  looked  for  ways to  overcome  his                                                               
concerns  about retroactivity  and preventing  people from  their                                                               
final day in  court on this subject and  explained that Amendment                                                               
1  makes him  more comfortable.  Using   "determined" instead  of                                                               
"resolved" makes  the language  clearer. The  second part  of the                                                               
amendment  deleting "final"  would obviate  the court  cases that                                                               
came  along after  the law  was changed.  But it  would leave  in                                                               
place the court case that was  brought before the law was changed                                                               
- that  has summary judgment going  in their favor at  this stage                                                               
of the proceedings.                                                                                                             
SENATOR  SEEKINS  asked him  to  explain  the difference  between                                                               
"resolved" and "determined".                                                                                                    
SENATOR ELLIS replied  that a settlement would have  to be signed                                                               
off by  a judge. He  is not  an attorney and  "determined" seemed                                                               
clearer from a layman's perspective.                                                                                            
SENATOR  SEEKINS  said he  didn't  mind  using "determined",  but                                                               
objected to  using "final". The  intent of the legislation  is to                                                               
make sure state  law is on an equal footing  with federal law. If                                                               
this legislature knew  there was a conflict, it  would have acted                                                               
to  eliminate  it  sooner.  It  was  always  the  intent  of  the                                                               
Legislature to agree with the  principals the state was operating                                                               
under  since 1980.  He  wouldn't  object to  its  passing out  of                                                               
committee,  because the  Judiciary  Committee would  look at  the                                                               
legal aspects of the word.                                                                                                      
SENATOR  ELLIS  moved  to  divide the  question.  There  were  no                                                               
CHAIR BUNDE  moved Amendment  1, on  page 1,  line 13,  to delete                                                               
"resolved" and insert "determined".  Senators Ellis, Seekins, Ben                                                               
Stevens and Chair Bunde voted yea; and Amendment 1 passed.                                                                      
CHAIR BUNDE moved  Amendment 2 to delete "final" on  page 1, line                                                               
14.  Senators Ben  Stevens, Seekins  and Chair  Bunde voted  nay;                                                               
Senator Ellis voted yea; and Amendment 2 failed.                                                                                
SENATOR  SEEKINS moved  to pass  CSSB 105(L&C)  out of  committee                                                               
with individual recommendations and attached fiscal note.                                                                       
SENATOR ELLIS  objected saying he  still has  legitimate concerns                                                               
without adopting the second half of the amendment.                                                                              
SENATOR SEEKINS guaranteed looking at  the issue in the Judiciary                                                               
Committee. Senators  Ben Stevens,  Seekins and Chair  Bunde voted                                                               
yea;  Senator  Ellis voted  nay;  and  CSSB 105(L&C)  moved  from                                                               

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