HB 68 - VOLUNTARY FLEXIBLE WORK PLAN: OVERTIME Number 151 REPRESENTATIVE GENE THERRIAULT came forward to present a committee substitute related to HB 68 and to answer questions for the committee. This committee substitute incorporates comments made from the previous hearing and as a result narrows the scope of the legislation. The new language appears primarily in lines 5 through 9 of the new committee substitute as follows: (17) work performed by an employee under a voluntary flexible work hour plan that is not entered into under paragraphs (13) or (14) of this subsection if the employee is employed at a surface metal mining operation that operates year round and if REPRESENTATIVE THERRIAULT stated that they didn't want to impact seasonal employment and the overtime opportunities made available in these positions. They also narrowed the legislation to metal mining operations to make clear not to impact gravel extraction, peat operations for lawns, coal operations, etc. In addition, much of the previous testimony made it seem like a number of people were unaware of the extensive exemptions in the current statutes. He said he had a document which he would make available that outlines these exemptions. REPRESENTATIVE THERRIAULT continued that currently small mining operations with no more than 12 employees are completely exempt; agriculture, horticulture and dairy product processing are completely exempt; small businesses with less than four employees are completely exempt; forestry and lumber operations with no more than 12 employees are completely exempt. He noted that the previous testimony indicating that this would impact thousands of employees in the State of Alaska, in light of this narrow scope, plus the existing exemptions make it clear that the impact of the bill has been greatly narrowed and would not impact nearly the number of employees indicated. REPRESENTATIVE THERRIAULT added that there was some question as to whether or not the bill's scope could be narrowed without causing a constitutional problem because they would be treating one class of mining operation differently from another. He did have a discussion with the legal department and they indicated that the narrowing or limitations drafted into this bill would probably not trigger a heightened scrutiny by any court. They don't believe that there is any problem currently in the state statutes. There are a number of distinctions drawn between coal mining operations with regards to reclamation, gravel mining operations and different sections of the statute. These have been allowed to exist in the statute for a long time without any legal challenges. REPRESENTATIVE THERRIAULT also noted that he did check around for some other 24-hour operations in the State of Alaska that currently operate under a very similar job scenario as proposed in this new legislation. He cited medical facilities as an example. Right now people providing medical services are completely exempt, as well as those that operate under collective bargaining agreements. In Fairbanks, the municipal utilities system operates a power plant and are organized under Local 302. These employees currently work 12-hour shifts and are not paid for overtime until they work over 40 hours in a given week which is exactly what they are asking for. He referred to previous testimony from someone within Local 302 who testified against the bill. What they are asking for is that the Fort Knox workers have the same flexibility to structure their work situations as those utilities workers as referenced. Number 606 REPRESENTATIVE TOM BRICE noted that it was a stretch by using the example of a Local 302 employee under collective bargaining to compare this to the legislature. The legislature is not prepared to negotiate for employee's rights or benefits to the extent of an organized union. A lot of the exemptions within .060 deals with very small mining operations which are limited to 14 weeks in a year and he didn't think the Fort Knox situation could be compared to a hospital where lives are at stake. REPRESENTATIVE BRICE asked why it was necessary that the legislature act as a negotiating agent between management and labor at the Fort Knox mine. This was his concern. Number 730 REPRESENTATIVE THERRIAULT didn't think the legislature needed to act as a negotiator for the employees. What the employees are asking for is that they be able to negotiate on their own behalf, just as the workers at the power plant used earlier, they've chosen to negotiate as a group through a collective bargaining agreement. This certainly is their right. The Fort Knox employees have chosen not to be represented by a collective bargaining agreement and as a by-product of this decision their flexibility to structure their work hours are limited by state statute. They are asking for the same flexibility. It doesn't preclude them from organizing under a union eventually if they so choose. The Commissioner of Labor is the person to approve these flexible hour agreements. No standards have been included in this legislation by which the commissioner is to make a determination based upon the same. The courts then won't have anything to come back and say, "well according to the standards we think you made a wrong decision in either approving or turning it down. It's completely his call." REPRESENTATIVE THERRIAULT stated that he used the hospital example as other 24-hour operations in regards to employees having some flexibility in structuring their work schedule. The overriding consideration is that it's a 24-hour operation, rather then factoring the fact that a hospital provides life or death services. Number 890 REPRESENTATIVE BRICE noted that a 711 or a MAPCO convenience store are 24-hour operations too. He asked for a reference specifically to the 24-hour section within the statute and its exemption. REPRESENTATIVE THERRIAULT qualified that there was not an exemption in statute specific to a 24-hour operation. Number 1122 REPRESENTATIVE JOE RYAN moved to adopt the new committee substitute before them. Hearing no objection it was so moved. The committee substitute 68, version 0-LS0329/F was adopted by the Labor and Commerce Committee. CHAIRMAN ROKEBERG called a very brief at ease which lasted for five minutes. Number 1284 ED FLANAGAN, Deputy Commissioner, Department of Labor came forward to testify. He initially spoke to the committee substitute. He stated his appreciation for the committee and sponsor for addressing some of the concerns verbalized at the previous meeting, but the department was unable to remove its objection to this legislation. The department felt as though it was ill advised to add "willy-nilly" more exemptions to the state's basic labor laws. It's true that there is a laundry list of exemptions in statute already, but many of them go back to the original enactment of this statute. In the case of the medical centers, they are public employees regardless of whether they are represented by a union or not. They are also exempt under this act. "We would probably as a department, I don't know as an administration, support putting them under the act, but I think Alaska Municipal League might have a different opinion on that. So they are only under federal FLSA law for over 40." MR. FLANAGAN stated that the department's opposition to adding exemptions is born out by one of the letters received from a trucking firm in Fairbanks supporting the original bill and stating that all employers should have the right to work their employees 12 hours without paying over-time. This was exactly what the commissioner was saying and "I'm sure there will be two or three lobbyists racing each other to the phone to call this company and have them as a client next year to get a little technical amendment exempting their employees from these onerous over time laws." MR. FLANAGAN responded to the statement made about the commissioner's power to approve or deny flexible hour agreements, by stating that any action the department takes can be challenged in court. They would only be able to deny them as they do under current law if there is evidence of coercion or that the agreement was a condition of employment. Number 1416 MR. FLANAGAN stated that the department has 17 years of experience approving flexible work hour plans and these are approved or denied on their merits as to whether they comply with statute and regulation language under the Administrative Procedures Act. The department is complaint driven. If a problem is brought to their attention they will investigate, but they do not have any audit trails on these items. With regard to the memorandum which the commissioner submitted to the chairman, they ran the numbers in different ways. The only new number they ran was a figure under current law of Fort Knox's proposed schedule of 14 / 12-hour shifts in a 28 day period what the gross wages would be which was $3,430.00 as opposed to $3,080.00 in a four week period under the Fort Knox, AMAX Fairbanks Gold proposal of straight time, 12 hours. They also ran the figures to try and estimate a pay adjustment to hold harmless or neutral which was $15.71 per hour on the proposed schedule. This would be gross pay neutral and benefits would have to be adjusted to hold the employees harmless. They also ran the figures in regards to the cost on a yearly basis for 240 employees on a proposed 14 / 12-hour shift in a 28 day period under current law this figure would be just under $1.1 million. This is just in gross wages. He noted there were roll-ups such as social security, medicare, etc. "There probably is somewhere $1.3, $1.4, $1.5 million that Mr. Lang represented as the cost. Again, that is the cost of complying with the law." MR. FLANAGAN stated that commissioner at the previous meeting was asked if the Fort Knox mine had an approval for its 4 - 10 plan. Since July of 1995 they have been in compliance with this plan and they've had no complaints. Number 1563 CHAIRMAN ROKEBERG inquired as to a meeting last year regarding ten- hours-at-the-face bill and whether or not the commissioner wanted more discretion then when the committee was trying to put some side boards on it. MR. FLANAGAN responded affirmatively and stated that, "in that bill and actually as the bill was passed, but for the 12-hour possibility, not the 10-hour, the 10-hour is a given and then with a request they can get a variance for 12. The variance procedure, the variance language was an entirely different process. It was more akin to what we do for OSHA variances. There has to be a finding, the possibility even of a hearing, a written finding and the discussion and as that language stands it would lend itself to a more comprehensive examination." The issues there were what the total work encompassed when travel was accounted for. This was a broad look and a finding that this situation was safe or whether it was unsafe. This was a different analysis and standard. MR. FLANAGAN reiterated what the commissioner had noted when one 4 - 10 or 4 - 12 plan is approved for one concern and denied for another this would open up to the department to challenges, especially if it was anything construed to be arbitrary or capricious. Number 1660 CHAIRMAN ROKEBERG stated his astonishment at the analysis used by the deputy commissioner and for the record noted that this particular bill gives the commissioner total discretion to make this determination. What Mr. Flanagan suggests is that the department would like to have further constraints placed on the commissioner which seems to be diametrically opposed to the idea of 100 percent discretion. MR. FLANAGAN noted that it had been their experience that they do not have the discretion that the chairman or the sponsor have referenced. The department issues a certificate approving a plan which states the work is for 40 hours a week and not more than 12 hours a day. They have no confidence that a denial by the department related to this review, unless coercion or a voluntary standard being a condition of employment can be found, would pass any judicial or legal challenge. CHAIRMAN ROKEBERG asked, in light of this, whether or not Mr. Flanagan's confidence level would go up if he did have a process for a finding within this exemption in the statute. Number 1730 MR. FLANAGAN stated, not particularly, the exemptions as they are added, results in two more the next year. "Where's it going to stop?" Stated simply, the department's position is there are several exemptions already provided for and at what point are there enough? CHAIRMAN ROKEBERG stated that they couldn't have it one way or the other. MR. FLANAGAN noted that he was responding to the sponsor's statement that the commissioner has a very broad discretion. They do not feel as though this is fact. Number 1790 REPRESENTATIVE THERRIAULT asked the deputy commissioner to explain the standards under the Fair Labor Standards Act (FLSA), a federal statute. MR. FLANAGAN stated that the FLSA requires overtime over forty hours. It does not reference the over eight hour standard which is in place in Alaska and in six other states. REPRESENTATIVE THERRIAULT noted he thought it was portrayed that paying overtime for anything over eight hours despite what the individual worker wants was the mainstay for workers in the United States. He didn't know that this was necessarily true. He asked if there was a problem with the way that the 10-hour exemption is working now as far as the commissioner reviewing and approving to make sure no coercion is present and it's what the employees really want. MR. FLANAGAN stated that the problem with this is the department's resources. He reiterated that the department is complaint driven. They don't audit payrolls like they do under Title 36. If the application on its face complies with the law, the department approves it through their regional wage and hour supervisor. Number 1870 REPRESENTATIVE TERRIAULT asked that if the commissioner gets an application and determines that an application is what the workers' want without coercion in any form would there be any other reason for the commissioner to turn an application down, regardless of safety issues or fair wages which could be taken care of through collective bargaining. MR. FLANAGAN stated that they always can opt for the latter option which is outside of state law. They also have an option under regulation for this chapter to annually rescind their individual, voluntary agreement. He further stated that a reason for the commissioner to turn down an application if the proposed work schedule was regularly scheduled for more than 40 hours a week even for more than 10 hours in a day, if it was 3 / 12's and a 4, they would not approve it. REPRESENTATIVE TERRIAULT asked if under this proposal, meeting these three standards, it is voluntary, no requirement, no coercion, would there be something that the commissioner would in addition look for to as a reason to turn it down. Number 1945 MR. FLANAGAN stated that since the department would view this effort as a "gutting" of the 8 hour work week for these employees and those that would follow in similar exemptions they would probably try to reject it on those grounds if it was perceived that they had the authority, but he felt that this would pass muster. "Your intent is going to be pretty clear through the record here, of, as this bill makes its way through that it's supposed to be approved and it's pretty hard, the whole 4 / 10's thing it lends itself to it, it's congruent 40 hours. Once we add 12 it kind of makes the whole, the 8 and the 40, even the exception to the 8 kind of meaningless. When 4 / 10's was done in 1980 that's what people were after, people understood what was involved. There were a lot of them happening at that time throughout the country really, as we first started to see these alternate work weeks." REPRESENTATIVE TERRIAULT made it clear that when he was presented with the idea he asked for the petition to make sure that this was what the workers wanted and he called some of the workers independently to make sure there was no coercion. He also asked how the idea was presented and he was told that this was what the employees very enthusiastically wanted. Number 2008 MR. FLANAGAN noted that they didn't dispute this a bit. He said that the department feels for these employees and they've talked to the employees, they've read all their letters. The department is not saying that there was coercion, it was their concern for other situations and unfortunately there's always the exception of a bad party who might abuse a situation. REPRESENTATIVE COWDERY asked how many employees in the state come under some of the present exemptions. MR. FLANAGAN stated he didn't know, but they would try to get this information for the committee and he generally stated that this number would definitely over a 1000. Number 2157 JOHN WARD testified by teleconference from Fairbanks in opposition to HB 68. He stated that HB 68 is a bad bill since it focuses on people who when they took their job knew what shifts they would be working. He thought it was bad precedent to change state law for a handful of people when it has huge potential of affecting others. Number 2188 DENNIS BROSMAN testified by teleconference from Fairbanks in opposition to HB 68. The legislation leaves it wide open for abuses of shifts from 10 to 12 hours. Number 2198 JOHN BENCK testified by teleconference from Fairbanks in opposition to HB 68. He stated that he'd worked construction in Alaska for 23 years. He noted that any number of contractors who have found it necessary to run 24-hour operations, including pipeline companies, road workers, etc., have done so without running to the legislature looking for an overtime pay exemption. He offered that this legislation appeared to be a special interest bill. The scheduling of a company's shifts is a company problem, not an issue for the legislature. If Fort Knox has a problem scheduling they should perhaps look at their own management. Number 2235 STEPHEN LANG, General Manager, Fort Knox Mine testified by teleconference from Sitka. When asked how many Alaskan workers would be covered by this new committee substitute or what operations would be covered, he responded that his understanding was the current substitute would cover two operations, Fort Knox and the Red Dog properties. He suspected that about 400 to 500 hundred workers would be covered and the amount of these workers which would actually participate depends on the individual. CHAIRMAN ROKEBERG noted at the previous hearing that there were a number of comments and allegations made that Fairbanks Gold deliberately created an onerous work schedule in order to coerce workers into supporting this type of legislative change and asked for Mr. Lang's comments. MR. LANG stated that with all respect the allegation was a lie. He noted the feasiblity studies and how if someone had reviewed them would recognize that due to the very low grade nature of the deposit and in accordance with Alaska law that the only way to afford to operate the property was on eight hour shifts. He checked the individual labor cost calculations in these reports and verified this. He pointed out the employees are not asking to go to a different 8-hour shift, "if it's simply a matter of the shift schedule they had been given they could have asked for a different 8-hour shift. They're asking for a 12-hour shift and the reason is to limit the number of, to increase the number of days they have off work." He added that this was a consequence of following the law, while allowing them to have more time off work. "It's almost word for word why we have the flexible work plan, the very language provided us from the Department of Labor which states it's designed to allow some scheduling flexibility by affording the employee an opportunity to work a reduced numbers of days within the 40-hour week." MR. LANG continued that is what's disturbing is the suggestion that if the company could have manipulated more than 200 people in this fashion, it is really an insult to the worker's intelligence. He felt the workers out there are far more intelligent than this and anybody who suggests otherwise grossly underestimates them. Number 2358 REPRESENTATIVE BRICE asked if the work crews had always been on this 8-hour shift or whether they had been on a 4 / 10's schedule. MR. LANG offered that he had only been with the company since November 1 and added that they had been on an eight hour shift since then. He didn't about the early mine operations and the 24- hour schedule and how it was segmented. Number 2385 REPRESENTATIVE BRICE asked if Mr. Lang or his predecessors were ever approached by employees prior to the petition presented to the legislature outlining this new proposal and whether or not there were other schedules proposed. MR. LANG stated that he had been approached by employees prior to this petition, yes. REPRESENTATIVE BRICE asked, "did, about a different schedule than what they're working, or about the 4 / 12's?" MR. LANG responded "about working 12-hour sched -- 12-hour shifts. REPRESENTATIVE BRICE asked, "4 / 12's and the 4 / 12, 3 / 12 that you, that you presented us or a different shift? MR. LANG stated that he simply presented it as 12-hour shifts. REPRESENTATIVE BRICE reiterated 7 / 12's. MR. LANG answered, "no sir." Number 2429 REPRESENTATIVE BRICE stated that he was not quite clear when Mr. Lang says a 10-hour shift. Generally, when shifts are discussed it's usually in the context of five days for eight hours a day, or seven days of 12 hours a day. MR. LANG stated that it was certainly possible to work 7 consecutive days and have the following 7 days off; it's possible to work 3 days on, 4 days off; or visa versa and there are a large number of varieties available. REPRESENTATIVE BRICE stated that this was his question, which variety was presented to you by the employees prior to this proposed shift. MR. LANG noted that there was no specific shift rotation presented to him (indisc. - cross talking) be able to go to 12-hour shift to limit the number of days at work. TAPE 97-5, SIDE B Number 000 CHAIRMAN ROKEBERG asked if Mr. Lang had looked into the alternatives to this legislation proposed by Mr. Frey and a few other individuals who will meet next week. Chairman Rokeberg outlined that it would be an alternative to reduce the wage schedules for the work force and pay the statutory overtime as presently conducted and proceed on this basis. In other words, it would keep their employees whole and the company's cost would be the same or similar and still operate their 12-hour shifts within the law. Number 155 MR. LANG stated that he was shocked to hear from the Department of Labor a recommendation to cut people's pay, but he also looked at the costs or impact similar to what the Commissioner of Labor did and he came up with a slightly different number. The commissioner showed about a $1.79 and Mr. Lang showed a figure of about $2.10. Regardless, he agreed that the impact would be about 2 to 3 times as suggested by Mr. Frey. As to the feasibility he noted there were some clear problems with it. Not all the employees would go to a 12-hour shift. Again, he felt like he'd need to accommodate employees on an individual basis. This would put him in the position of running a dual payroll system and his entire payroll department consists of one person. There are numerous disadvantages to the employee with this plan, most particularly, once they reduce the base wage there may be occasions where the employee does work an extra shift that would be compensated at an overtime rate, since the base rates would be reduced, by his calculation this would be a reduction in the overtime pay by more than $3.00 per hour. The employee would see a reduction in holiday pay and time worked on a holiday based on the base pay rate. Similarly they would have reductions in vacation pay, they would see reductions in the short-term disability and long-term disability payments to the employee, reduction in life insurance and also in the accidental death and dismemberment policy. They would have reductions in funeral leave, jury duty pay, and military leave pay, as well as a reduction in worker's compensation benefits. Based on all of these reasons, he felt as though the consequences of this casual suggestion was not clearly in the interest of the employee. He felt as though this would place a harsh burden on those individuals who want to spend more time with their families. He didn't think it was very well thought through and that this suggestion should be rejected. Number 185 TERRY QUIRK testified by teleconference from Anchorage in opposition to HB 68. The eight hour work day with overtime over eight was given to the American workers and their families by the United States government some 50 years ago. This effort was made necessary due to the exploitation of the American worker in mines, factories and other sweat shops of the day. Labor rights, just as constitutional rights, civil rights and the like are entrusted to our elected government officials of this land, to protect, not give away these rights and conditions. He suggested that Fort Knox adjust its hourly wage to accommodate the work schedule that the mine wants to work and pay the workers the money that the mine wants to pay them. "I calculated at $17.00 an hour under the 14 days every four weeks would currently pay $17.00 an hour for that employee and the company agree that the employee would work seven days straight, 12 hours per day, for $1496.00 a week. Instead the company could adjust the hourly rate of those workers to $14.11 an hour, the workers could agree to this on a voluntary basis and under the existing state labor laws work 7 / 12-hour shifts for the same $1496.00 a week." Number 282 LORIN JOHNSON testified by teleconference from Anchorage in opposition to HB 68. He stated that he had been in the construction field for 40 years. He does not support increasing a work day to 12 hours without overtime pay. He noted that if this bill passes it will only open the door for those other exemptions as mentioned. Number 306 MALCOLM AUBLE testified by teleconference from Anchorage in opposition to HB 68. He felt that it served a special interest for Fort Knox gold mine. State law should not be changed to benefit a few while creating a hardship for many others. To restrict this bill to mining and surface metals would be discriminatory to other industries. If it passed with a 12-hour work day it would be challenged in the courts, as well as other exemption allowance. This would cause harm to people employed seasonally who depend on overtime to make their yearly income. Number 376 CAROL DESNOYERS testified by teleconference from Fairbanks in opposition to HB 68. She said she sympathized with the workers of Fort Knox gold mine, especially in regards to the horrendous schedule which they keep in order to keep their jobs. "The reason we are here is because these workers have been led to believe that the only feasible and workable solution to rectify their scheduling dilemma and allow them more off time while still allowing the mine to operate within budgeting guidelines as the change exists in labor laws." She said they shouldn't loose sight that these laws were put into effect for a reason. They were put in place to protect the worker and also noted that this law could affect other occupations. This legislation would reduce any leverage regarding overtime hours and subsequent pay regardless of whether they are union or not. She mentioned the voluntary flexible work plan as an option which is already under existing legislation. Number 578 JOHN BRADING testified by teleconference from Fairbanks in opposition to HB 68. He felt as though the workers could have their proposed work schedule without changing the present laws. Number 605 CLARENCE NAZURUK testified by teleconference from Fairbanks in opposition to HB 68. He stated that he is currently on the executive board of Labor Local 942 and has worked out of that hall since 1974. He believes this bill will have rippling effects into organized labors which sets high standards for working conditions and wages. He felt as though this legislation would erode these conditions. Number 636 JESUS PRIM testified by teleconference from Fairbanks in opposition to HB 68. He felt it was unsafe work practices to pay straight time for 12-hour days. Number 666 TOM REHARD testified from the Mat-su Valley by teleconference in opposition to HB 68. Mr. Quirk stated most of the concerns by everyone there in the Mat-su. He noted that AMAX outside provides buses for their workers to commute. Number 705 DARRELL HILDEBRAND testified from Sitka in support of HB 68. He works for AMAX Gold at the Fort Knox project. He stated he supported this bill for a number of reasons, mainly because he's a family type person and he'd like to see his children grow up. He stressed that the employees are not being coerced and he said it's not all about money. He also noted the voluntary aspect to this plan. Number 786 DENNIS ALEXANDER testified by teleconference from Sitka in support of HB 68. He said this legislation would improve the quality of life for the employees. He said a cut in pay for hourly wages to include compensation for overtime to make up for this cut was unacceptable. He said he was disappointed with Tom Cashen's stand on this issue and made reference to the handbook on Alaska state government dated November 1996, on page 63 he read Mr. Cashen's job description as follows: "...to promote the welfare of the wage earner and to improve working conditions." He stated that this was exactly what the independent workers were trying to achieve without the input from labor unions and he also noted that Mr. Cashen's statement was an echo for the labor unions. The workers of Fort Knox need Mr. Cashen's support and he needs to also look at the condition of the operations. It is Mr. Cashen's mandate to do this. CHAIRMAN ROKEBERG asked Mr. Alexander and Mr. Hildebrand if they had paid their own way to Juneau and noted that they had attempted to fly to Juneau, but were unable to due to the weather. MR. ALEXANDER answered, "no, I was, I was sure trying to get there hard, but no I didn't." Number 1040 JIM BLAKEWAY testified from Fairbanks by teleconference in opposition to HB 68. He works for Usabelli Coal Mine and his concern is that this new legislation could interfere with their renegotiations of their contract. He also said he didn't understand how this could be voluntary and felt as though Fort Knox could handle the cost of overtime in light of the profits made. LYLE JOHNSTON testified from Fairbanks by teleconference in opposition to HB 68. He vested out of the Laborers Union, Local 942. If this legislation passes other industries will want to follow suit. MATT CLOWARD testified from Fairbanks by teleconference in opposition to HB 68. He is a heavy equipment mechanic and he is totally against this legislation. MONTY BURBANK testified from Fairbanks by teleconference in opposition to HB 68. He has been a member of organized labor since 1976 and he's currently employed at Usabelli Coal Mine. He cited the sacrifices of men who organized and lost wages through picketing so that he was able to make a decent living. He saw no reason to tamper with labor laws and it would only throw back the clock. He encouraged the Fort Knox employees to organize. Number 1040 STEVE ANDERSON testified from Anchorage by teleconference in opposition to HB 68. He stated that he has been in construction for 25 years and that HB 68 would cause deterioration to the present law. Number 1074 WAYNE PLUMB testified from Anchorage by teleconference in opposition to HB 68. He has been a seasonal construction worker and he's also worked 4 / 10 flexible work weeks and has seen how they are manipulated and abused. Number 1107 MICHAEL KILLIAN testified from Anchorage by teleconference in opposition to HB 68. He stated that he's worked in numerous capacities in the construction trade, including mining. He questioned how the voluntary aspect of this legislation could work. He didn't see any correlation between this legislation and the accommodations made for Greens Creek mine last year. Their issue was extending hours working at the face of the mine underground from eight hours a day to ten hours a day and it was not intended to jeopardize any existing statutory protection now or then. He noted that employers will bargain hard to revise language and labor contracts to be changed from current overtime situations to the new revised laws they should have rights to such as outlined in HB 68. Number 1278 CLICK BISHOP testified from Fairbanks by teleconference in opposition to HB 68. He stated that he was a second generation member of the Operating Engineers Local 302. He made it clear that he is very proactive for the mining industry in Alaska as long as it can be achieved in an economically feasible manner for both the owner and the employee, along with safety considerations and the affects to environment. He is not opposed to the Fort Knox employees achieving their scheduling goals, but he is opposed to a bill which would be a detriment to all surface miners in Alaska. He also mentioned workers at the Red Dog Mine and how none of them had testified to this legislation yet. Number 1362 TONY ROYBAC testified from Fairbanks by teleconference in opposition to HB 68. He's been a member of the Laborers Local 942 since 1975 and he felt as though this legislation would open up a whole "can of worms." Number 1389 MIKE TOMSHA testified from Fairbanks by teleconference in opposition to HB 68. He stated that this shift work issue is nothing new and will be implemented whether the employees get their overtime or not. Number 1408 NED GRIFFITH testified from Fairbanks by teleconference in opposition to HB 68. He works for Local 942 and he addressed the Fairbanks legislators specifically. He didn't agree with legislating for a small few in relation to laws which have been intact for 60 years. Number 1469 CHAIRMAN ROKEBERG said he agreed with Mr. Bishop's comments regarding the Red Dog Mine. The committee has solicited a response from these employees to make sure they are appraised of this legislation. Number 1490 ARON HOULTON testified from Juneau in support of HB 68. He works at the Fort Knox facility. He noted other testimony from individuals who seem to ignore the voluntary aspect of this legislation. He has worked at this mine from the first day and this scheduling issue was an issue then. It seemed the main opponent to this legislation was organized labor. He stated that the employees of this mine are thinking, competent individuals who wish to have want they want, not to put it on anybody else. They want to be able to decide their own work schedules and spend more time with their families. Number 1548 REPRESENTATIVE TERRIAULT asked Mr. Houlton to explain how the issue of a petition was raised and presented to him. MR. HOULTON stated that this issue was brought to him by Doug Nicolson. It had come to Mr. Nicolson's attention that the employees wanted this new schedule, which was nothing new. Mr. Houlton mentioned co-workers who had left the mine because of the work schedule. The workers were told the petition was voluntary and said that 241 employees signed it. Number 1600 REPRESENTATIVE TERRIAULT asked if there was a high level of understanding amongst the employees that if at any time they were being unfairly treated by the company that they had the right under federal law to organize and collectively bargain for hours and wages. MR. HOULTON responded absolutely. He said they'd never seen the need to organize. When this scheduling change issue was brought forth, Fort Knox said they would "go to the wall" for the employees. The company pays a fair wage and he makes more money now than he's ever made anywhere else, plus they offer great benefits. Number 1669 CHAIRMAN ROKEBERG asked Mr. Houlton what he did, how much he made and whether or not he had paid for his trip to Juneau to testify. MR. HOULTON stated that no he did not pay for his trip, he makes $19.50 an hour and he's a shovel operator at the Fort Knox Mine. Number 1685 REPRESENTATIVE BRICE asked who Doug Nicolson was. MR. HOULTON stated that he is a mine supervisor and was the individual who made the petition available. He stated that the first time they put equipment into the dirt they worked 5 / 8's and then it changed to the current schedule they have now. The 5 / 8's shift only lasted about two weeks. He said he was aware of other employees who had tried to get the schedule changed before Mr. Nicholson's efforts. At safety meetings the subject of the schedule has always been discussed. It was understood that once the mine was in full production this issue would be addressed. Number 1800 DAN SIMIEN testified by teleconference from Fairbanks in opposition to HB 68. He noted that everyone in Alaska had a collective ownership to mineral resources. He asked that overtime laws as they currently exist be maintained. Number 1938 SCOTT VAUGHN testified by teleconference from Fairbanks in opposition to HB 68. He stated that this was regressive legislation and erodes laws established to protect workers. Number 1983 RICHARD ROSE testified by teleconference from Fairbanks in opposition to HB 68. He thought that the Fort Knox employees have not contemplated enough what they're going to loose in the long run. Number 2047 DAN REPASKY testified by teleconference from Anchorage in opposition to HB 68. He said he spoke for on behalf on the entire membership of the International Brotherhood of Electrical Workers (IBEW), Local Union 1547. The IBEW represents nearly 5000 men and woman throughout the state of Alaska, all of whom are paid an hourly wage in exchange for their work. To adopt this proposed legislation would return the Alaskan worker to a pre-twentieth century standard. Wage and hour laws were established in response to employer coercion. "There is a strong motive for an employer to subtly or even overtly suggest workers voluntarily give back two hours of overtime per day. One must seriously consider the realistic chances of an employee risking a job by refusing to (indisc.) an employer and thereby facing a prospect of being replaced by someone just a little bit hungrier who is willing to work under the voluntary plan. That is precisely why the provision exists in state law for workers to develop a bonafide, voluntary flex plan within a collective bargaining agreement." MR. REPASKY stated that corporate benefit drives this legislation. His organization is not convinced that this reduction in compensation is being brought before the legislature solely on behalf of these workers and noted the four lobbyists hired to help with this effort. Fort Knox should accommodate their employees concerns under current law. Number 2244 REPRESENTATIVE TERRIAULT stated that the testimony heard regarding employees forfeiting two hours of overtime pay led him to believe that the speaker thought the Fort Knox employees could exercise the ten-hour exemption for the two hours beyond this. He asked Mr. Flanagan to speak to them briefly about the ten-hour exemption. It was his understanding that the department's interpretation of the ten-hour exemption is that they can get the ten-hour exemption, but they could not work past ten hours. The ten-hour exemption couldn't be used to work straight time up to ten hours and then continue to work two more hours and get overtime. He stated the reason he brought it up was that many of the witnesses were testifying under this belief. MR. FLANAGAN said it's true. They would deny a request for an existing law flex plan for regularly scheduled 4 / 10's although in the law it does allow payment of overtime over 10 in those 4 / 10's plans. Number 2350 CHAIRMAN ROKEBERG stated that he had in his hand a Fort Knox flex plan that's been approved by Mr. Flanagan's department. He asked if Mr. Flanagan would approve two hours of overtime based on this plan already in place. MR. FLANAGAN responded that no, not for the current proposed schedule. Number 2396 RICK BOYLES testified by teleconference from Fairbanks in opposition to HB 68. He addressed the Fort Knox operation and its profitability by mention of an article in the Keyways Construction Magazine, September/October issue that quotes Fort Knox officials as saying, the mine is expected to produce 300,000 to 350,000 ounces of gold annually and 4.1 million ounces of gold over a 12 year period which equates to over a billion dollars in revenues for Fort Knox. They've also said it would only cost them approximately a million dollars a year in overtime to pay their employees. He noted that this amount was not much out of a million dollars. This does have an effect on the surrounding economies which are based a lot on overtime. Overtime is a big factor in the Fairbanks area. TAPE 97-6, SIDE A Number 019 JOE ROSSER testified by teleconference from Fairbanks in opposition to HB 68. He is a member of Local 867 and said that this legislation caters to a single out-of-state company. He felt as though this legislation would erode the already existing labor laws. Number 113 RICHARD STALEY testified by teleconference from Fairbanks in opposition to HB 68. He's a construction worker and felt that the laws shouldn't be changed for just one company. He asked if this could be considered discrimination and whether or not this was something the voters wanted. Mr. Staley then gave figures of what the Fort Knox Mine would stand to make in profits. Number 285 MARK JOHNSON testified by teleconference from Anchorage in opposition to HB 68. He stated that he is a 17 year construction worker. He felt as though the overtime concessions in this legislation could be abused. Number 325 MIKE GALLAGHER testified by teleconference from Anchorage in opposition to HB 68. To change a law for one operation is ridiculous and will affect other industries. He felt that if this group of people sat down and looked at the options they could come up with solutions rather than altering legislation. Number 430 CHARLES PASKVAN testified by teleconference from Fairbanks in opposition to HB 68. He has worked in construction for 22 years and he did work at the Fort Knox Mine for two years. While there he witnessed a lot of out-of-state workers who came to work there. He didn't believe that this company should be able to change the laws to make money and thought that these individuals were mostly from out-of-state who wanted to see these changes made. Number 500 SANDRA MCGILL testified by teleconference from Fairbanks in opposition to HB 68. She has lived in Alaska for 16 years. She felt that if the Fort Knox Mine couldn't make a profit they should sell it to someone else. Number 554 PAUL MITCHELL testified by teleconference from Fairbanks in opposition to HB 68. He stated he has been in the mining industry for 20 years and was not representing a union. He asked that this legislation be buried. Number 610 FRED SMITH testified by teleconference from Fairbanks in support of HB 68. He presently works at the Fort Knox Mine and would like this legislation to pass in order to change his work schedule so he could be at home more. He would also save gas on commuting. Number 653 PAUL CUPPY testified by teleconference from Fairbanks in opposition to HB 68. He has worked in the Alaskan construction industry since 1974. He understands the dissatisfaction of working long shifts since he has done so himself, but he didn't feel it was necessary to change existing law to resolve this issue. Number 719 MICHELLE SIMPSON testified by teleconference from Fairbanks in support of HB 68. She didn't understand why everyone was there to protest if they felt this legislation would affect just a few individuals. She felt like family time was more important than overtime. Number 767 DAVID FORD testified by teleconference from Anchorage in opposition to HB 68. He is the business manager of Iron Workers Local 751 and he's been an Alaskan resident for 22 years. He felt as though they all agreed this legislation was at the bequest of the employer rather than the employee. This is special interest legislation and spoke to it lowering the standard of living. Mr. Ford also discussed the insurance ramifications of this legislation. Number 908 BLAKE JOHNSON testified by teleconference from Anchorage in opposition to HB 68. He's a life-long Alaskan and represents the Kenai Peninsula Central Labor Council. He recalled a bonfire in 1959 representing statehood and felt this legislation belonged there. He cited all the industries in the Kenai area which work overtime schedules. Number 980 JANE BENEDICT testified by teleconference from Fairbanks in support of HB 68. Her husband works at Fort Knox and he was a local hire. They used to live out-of-state and saw the affect of the change from an 8-hour rotating shift at a mine to a 12-hour shift and their family life improved considerably. She noted that the scheduling of both hearings on this legislation made it inconvenient for the Fort Knox workers to attend. Number 1070 CHAIRMAN ROKEBERG made a point for the record that the committee has received a number of letters from the workers and their families in lieu of verbal testimony. He asked Ms. Benedict to elaborate on how these two shift options affected their family. MS. BENEDICT explained that she also works full time at a more traditionally shifted job for eight hours a day, five days a week. She's not available to participate in her child's school activities as much as she'd like. When her husband's on a 12-hour shift he has more time and energy to give to such activities which helps to take pressure off the family. Number 1110 GLEN BAYSINGER testified by teleconference from Fairbanks in support of HB 68. He's an employee of AMAX Gold and he considers this a good opportunity. He felt the present schedule was not good from a safety perspective. Number 1160 DARLINE HERBERT testified by teleconference from Fairbanks in opposition to HB 68. She felt that this legislation was a step backwards. Number 1210 JIM LAITI testified by teleconference from Fairbanks in opposition to HB 68. He is a 26 year construction worker and didn't think this scheduling issue should be resolved through legislative channels. Number 1335 MANO FREY testified by teleconference from Anchorage in opposition to HB 68. He is the local president of the AFL-CIO council. Firstly, he stated that Mr. Lang's numbers were closer to the mark than his in regards to the reduction of wages. This doesn't change the fact of the matter. Schedule changes should take place to accommodate family life, but this should be done within the restraints of the law. He felt that if this law was not modified that the company would adjust the employee wages which should be done anyway. Number 1517 JAMES CONATSE testified by teleconference from Anchorage in opposition to HB 68. He is the business manager of one of the local unions there and applauded Mr. Frey's comments. Number 1546 DAN LOUDERBACK testified by teleconference from Anchorage in opposition to HB 68. He found this legislation offensive to labor and exploitative. Number 1590 MIKE SWEENEY testified by teleconference from Fairbanks in support of HB 68. He is an employee at Fort Knox. He stated that the people who oppose this bill already have the right to negotiate their schedules under collective bargaining. Because they don't belong to a union, they're not allowed and he has a problem with this. Number 1620 GREG CHAPIN testified by teleconference from Fairbanks in support of HB 68. He's an employee of Fairbanks Gold and it's been the best job he's ever had. He doesn't need a union to find himself a job. The employees are just asking for the right to determine their own schedules. Number 1658 STEVE STEEL testified by teleconference from Fairbanks in support of HB 68. He's an employee of Fairbanks Gold as a shovel hand and as lead on his crew. This scheduling concern has been an issue from the beginning and it's physically exhausting. Number 1749 EDWARD IRBY testified by teleconference from Fairbanks in support of HB 68. He commented to the earlier questions about truck driver scheduling. This legislation would allow more time with families. Number 1800 JOHN BROWN testified by teleconference from Fairbanks in opposition to HB 68. He is currently the president of the Fairbanks Central Labor Council. Even though this is a union concern he felt like he represents all workers. He spoke to why there are labor laws in this country. This proposed change would be a backwards step. Number 1884 WAYNE COUCH testified by teleconference from Fairbanks in support of HB 68. He is an employee at Fort Knox. He understands the value placed on unions, but their opposition to this bill is unjustified. It's not their place to negotiate this legislation for them. He spoke about the work schedule now as it exists. Number 1925 CORY BELLOWS testified by teleconference from Fairbanks in support of HB 68. He is a mill operator at AMAX. He said he would choke if he heard one person say they, the employees, did not come up with this proposal on their own. He noted the exemptions already built into the present law. He made the analogy that maybe the unions were special interest groups. Number 2028 BRAD MERRILL testified by teleconference from Fairbanks in support of HB 68. He stated that he used to live in Ketchikan and worked at the mill. Since the shutdown he moved to Fairbanks and went to work at the mine. The Fort Knox Mine is a great company. He outlined the proposed changes to the schedule and its benefits. Number 2098 MARK HAMBLETON testified by teleconference from Fairbanks in support of HB 68. He works for AMAX Gold and he felt they've been the best company he has ever worked for and he's worked for a lot of different companies. He was disappointed that the unions were trying to twist their arms to join when they feel the unions aren't necessary. Number 2125 MIKE MENNAGHAN testified by teleconference from Fairbanks against HB 68. He has worked in Alaska for 23 years and now presently works out of Local 942. He is against HB 68. Number 2140 WAYNE PEPPLER testified by teleconference from Fairbanks in support of HB 68. He has lived in Fairbanks since the early 1960's and has engaged in every type of mining and on either side of the labor situation. This company has offered him more benefits right off the top. His family is covered by full medical. Number 2250 DONNIE RICE testified by teleconference from Fairbanks in support of HB 68. He is an employee at Fort Knox and has worked mining most of his life. He stated the schedule changes would improve the life of the employees, even though they'd loose the overtime. Number 2318 GARY ALLEN testified by teleconference from Fairbanks in support of HB 68. He is an employee at Fort Knox Mine and made an argument that this company came in and hired 90 percent local people. He made the comparison of this to the North Slope. Number 2360 SYLVIA WARD testified by teleconference from Fairbanks in opposition to HB 68. She works with the Northern Alaska Environmental Center and made clear it that she does not work for or represent a union. Ms. Ward stated that Fort Knox has contributed quite a lot to this community, but she saw this legislation as special interest and said this could be destructive to others. She then outlined proposed suggestions to their schedule which would not impact legislation. Ms. Ward referred to a Wall Street Journal article dated January 27th and quoted the headline, "Goldmining Firms Act to Meet Price Slump Challenge." MS. WARD responded to Chairman Rokeberg's question as to whether or not she wanted to see the Fort Knox Mine shut down. She said no and that this was not what her testimony was about. TAPE 97-6, SIDE B Number 000 JEFF HOWE testified by teleconference from Fairbanks in support of HB 68. He is an employee of the Fort Knox Mine and has been a resident of Alaska for 13 years. In no way were the employees coerced. This is a voluntary program. Number 102 TIM SHARP testified by teleconference from Fairbanks in opposition to HB 68. He represents the Alaska Labor Political Education Committee and initially noted how he resented that this was being played in the press as a union issue. He said instead of taking a cut these employees should get a raise and stated that organized labor speaks for everyone. Laws are not written for just the good employers like Mr. Lange, but for the bad employers as well. These alterations to existing law have the potential for abuse. Number 2045 ALEX KARVELIS testified by teleconference from Fairbanks in support of HB 68. He is a Fort Knox employee and likes his job. The present work schedule is hard on the body and it seems like this legislation is the best option. Number 227 MICHELLE STEEL testified by teleconference from Fairbanks in support of HB 68. She and her husband are employees at Fort Knox and they were local hires. She was not coerced to testify and wholly supports this legislation. This legislation will reduce the time to drive to work reducing money on gas and will increase their income by 2.3 percent, not to mention more time spent with family. Number 302 TERRY COX testified by teleconference from Fairbanks in support of HB 68. He is a Fort Knox Mine employee and has five children. He makes a good income and is satisfied. With the schedule change he'll have more time with his family. It's important that employers and employees are able to work things out themselves. Number 384 TIM RENNER testified by teleconference from Fairbanks in opposition to HB 68. He is a member of Carpenter's Local 1243. In the long run this legislation has the potential to affect him and others in unions. Number 429 PATRICK SUMPTER testified by teleconference from Fairbanks in opposition to HB 68. He's been a commercial truck driver for 15 years and the last few years he's been a Teamster. He also worked at the mine for some time too and had no problem with the long shifts. He felt that overtime laws should stay intact and that he can't support this legislation. Number 575 STEVE BRANDT testified by teleconference from Fairbanks in opposition to HB 68. He is a 25 year resident and is a teamster. He also worked at the Fort Knox Mine during the construction phase. He broke his back on the road commuting from the mine this last summer after working long hours during the day. Number 622 CHAIRMAN ROKEBERG closed the public testimony and welcomed further written testimony from anyone who so desired.