Association of Washington Business states objections to L&I’s proposed overtime rule in compelling 9-page memo.

The Association of Washington Business Friday filed a 9-page memo detailing the reasons it opposes the Department of Labor and Industries’ proposed overtime rule. Friday was the last day for public comment; the comment period was expanded by L&I in response to the “high level of interest” in the issue. For background, see our most recent post on the proposal.

The AWB memo makes a compelling case. We recommend reading it in its entirety to appreciate the substantive objections. For a preview, though, we’ll  quote some initial points made by in the memo written by Bob Battles, general counsel, AWB and Dan Thieme, with Littler Mendelson, P.C. and a member of the AWB Employment Law Committee.

AWB objects, in the strongest terms possible, to the proposal to increase the minimum salary level far above the expected new FLSA salary minimum, and well above any other jurisdiction in the country, ramping to 2.5 times Washington minimum wage (and 3.5 times Washington minimum wage for hourly-paid computer professionals), and incorporating upward-only CPI adjustments.1 This proposal is not supported by the record (which is inadequate in any event to support any action other than to conform the Washington regulation to the FLSA), is not legally permissible, and if adopted is likely to result in litigation invalidating the final rule. Even if it could be legally justified, the proposal is bad public policy.

AWB also objects to the Department’s failure to await the conclusion of the pending federal DOL salary basis rulemaking. As reported by Bloomberg, the federal DOL proposed final salary basis rule has cleared White House review and is expected to be published soon. The Department is legally obligated to justify in its cost-benefit analysis any differences between its own rule and the parallel federal law. There is no legally sufficient justification for these differences, particularly if the Department acts even before it knows what the new federal standard will be.

AWB also objects to the three other respects in which the proposed rule deviates from the FLSA: the lack of a highly-compensated employee exemption; the requirement that exempt outside salespeople must be compensated on a guaranteed salary, commission or fee basis, and be advised of their status as outside sales employees; and the requirement that professionally-exemption teachers must be paid on a salary or fee basis. The record lacks the mandatory substantial evidence that these differences from federal law are necessary to achieve the general goals and specific objectives of the Washington overtime exemptions. AWB strongly supports the fact that the proposed regulation would bring the Washington duties tests into conformance with the FLSA duties tests in all other respects.

In light of these well-documented objections – and those expressed by employers throughout the public comment process – we look forward to the department’s revised proposal.