To amend the Fair Labor Standards Act of 1938 to clarify provisions relating to overtime pay.

JUMPSTART OUR BUSINESS STRENGTH (JOBS) ACT

The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of S. 1637, which the clerk will report.
The assistant legislative clerk read as follows:

A bill (S. 1637) to amend the Internal Revenue Code of 1986
to comply with the World Trade Organization findings on the
FSC/ETI benefit in a manner that preserves jobs and
production activities in the United States, to reform and
simplify the international taxation rules of the United
States, and for other purposes.

Pending:

Harkin amendment No. 3107, to amend the Fair Labor
Standards Act of 1938 to clarify provisions relating to
overtime pay.
Collins amendment No. 3108, to provide for a manufacturer's
jobs credit.
Wyden amendment No. 3109, to provide trade adjustment
assistance for service workers.

The PRESIDING OFFICER. Under the previous order, the time until 12:30
p.m. shall be equally divided between the chairman and ranking member
of the Finance Committee or their designees.
The Senator from Montana.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending
amendment be set aside so that the Senator from North Dakota may offer
his amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 3110

Mr. DORGAN. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from North Dakota [Mr. Dorgan], for himself,
Ms. Mikulski, Mr. Harkin, Mr. Feingold, Mr. Kennedy, and Mr.
Edwards, proposes an amendment numbered 3110.

Mr. DORGAN. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The amendment is printed in today's Record under ``Text of
Amendments.'')
Mr. DORGAN. Mr. President, I shall not debate the amendment at the
moment. My understanding is the bill managers want to sequence a number
of amendments. Let me indicate this amendment deals with the question
of trying to close a tax provision that actually rewards or
incentivizes those U.S. companies that would move jobs overseas for the
purpose of producing a product and shipping it back into our
marketplace. I believe that is a tax loophole that ought to be closed.
We ought not incentivize the loss of American jobs and the movement of
American jobs overseas.
I offer this amendment on behalf of myself and Senator Mikulski and
others. We will be happy to come this afternoon to debate it. Also, I
will be happy to reach a time agreement when we come back this
afternoon. It is not our intention to delay this bill. I want to see
this bill finally passed, but I do want to have a good debate on our
amendment. We will be ready to have a reasonable time agreement this
afternoon.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, it is my understanding, after speaking with
the

[[Page S4788]]

two managers, that Senator Harkin and Senator Judd Gregg will debate
the overtime amendment, but they are not here now.
I ask unanimous consent that Senator Schumer be allowed to speak as
in morning business for 5 minutes.
Mr. GRASSLEY. If you give us 5 minutes sometime during the day.
Mr. REID. And that the Republicans have like time on their side
whenever they want.
The PRESIDING OFFICER. Is there objection?
Mr. BAUCUS. Reserving the right to object, and I will not, before he
leaves the floor, I thank the Senator from North Dakota. He has been
helpful and constructive in getting amendments lined up. I spoke to the
cosponsor of the amendment a short time ago, and she will, this
afternoon, join the Senator. I thank the Senator for his cooperation.
I have no objection.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from New York.

New York National Guard

Mr. SCHUMER. Mr. President, I thank both the chairman and the ranking
member of the Finance Committee for allowing me to speak for 5 minutes
on this issue.
I wish to take this opportunity to recognize the important and
significant role that New York's 2nd Battalion 108th Infantry Regiment
recently played in the rescue of Thomas Hamill, the civilian contractor
held captive for 3 weeks in Iraq.
Seeing this unit in the area surrounding the farmhouse in which he
was kept gave Mr. Hamill the courage to stand against his captors and
escape to freedom. That is why I wish to recognize the 2nd Battalion
108th Infantry Regiment today.
I know it must be of great comfort to Mr. Hamill's family and friends
that when he first stepped in the light of freedom, he was greeted by
these fine New Yorkers. This is what it is all about. A man from
Mississippi escaping bravely, and there were New Yorkers. They are
headquartered in Utica, NY, with companies in Whitehall, Morrisonville,
Gloversville, Rome, and Glens Falls. The unit has served this country
since 1898 at home and abroad, and there they were in exactly the right
place at the right time to help Mr. Hamill.
The bottom line is that after the attacks on September 11, many of
the men and women of the 2nd Battalion were activated and came to New
York City to protect our citizens. They are aware, better than anyone
else, that this war on terror is a war we must fight both at home and
abroad, protecting us at home and protecting us abroad.
A full 11 of these National Guardsmen have such love for their fellow
New Yorkers and for America that they are fighting in Iraq as new
citizens, having been sworn in at a send-off celebration in February.
The 2nd Battalion is fortunate to have guardsmen hailing from Africa,
South America, the Ukraine, Japan, and across the world now serving as
American citizens. What an extraordinary first act as an American to
serve and protect the Iraqi people and lead Mr. Hamill to freedom.
Family, friends, and neighbors from Albany to New York City, from
Westchester to Plattsburgh, Syracuse and Buffalo all gathered together
at that send-off celebration to show their support and honor their
bravery.
In the 2 months they have been in Iraq, these men and women have been
serving under the leadership of LTC Mark Warnecke, having truly served
their country in the true tradition of the National Guard. Today I
recognize the efforts of the 2nd Battalion 108th Infantry Regiment.
When they return home to their families, they will do so as heroes.
Mr. Hamill is now safe and recovering in Germany and looking forward
to a reunion with his wife and his return to Mississippi, after his
courageous ordeal. I look forward to the day when the men and women of
New York's 2nd Battalion 108th Infantry Regiment can return as heroes
to their own families. May God grant them safety and security as they
finish out their tour. I hope their example will bring courage and
pride to all those serving in Iraq, resiliently going about their task
of bringing peace and freedom to the Nation.
All New Yorkers and all Americans congratulate the 108th Infantry
Regiment of New York today, and we say two words to the 108th Infantry
Regiment: Thank you.
I yield the floor. I ask unanimous consent that the time on the
quorum call be charged equally against both sides.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. SCHUMER. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The journal clerk proceeded to call the roll.
Mr. HATCH. Mr. President, I ask unanimous consent the order for the
quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. HATCH. Mr. President, may I know what the parliamentary state of
affairs is?
The PRESIDING OFFICER. The time is equally divided between the two
managers of the bill.
Mr. HATCH. As I understand it, the Harkin amendment is being debated?
The PRESIDING OFFICER. The Harkin amendment is pending.
Mr. HATCH. Mr. President, I rise today to express my support for the
Department of Labor's revisions to the Fair Labor Standards Act--FLSA--
to protect and extend overtime benefits to hardworking Americans. I
wish to thank Labor Secretary Elaine Chao for her leadership and vision
in bringing about this important reform for American workers. Overtime
provisions in Federal labor law are meant to safeguard low-income
workers from employers who would take advantage of them, but the
current regulations that implement the law are muddy, outdated, and
have led to countless law suits, some of which are frivolous and
fruitless. Truly, Secretary Chao has recognized that it is long past
due to reform our nation's antiquated overtime regulations.
The new regulations replace long-standing regulations which the
Department of Labor has characterized as ``confusing, complex, and
outdated.'' I agree. Consider the fact that the Federal overtime
regulations were last overhauled when Harry Truman was in the White
House. That's more than 50 years ago. We are relying on a half-century
old law to protect overtime rights for workers with job duties that
didn't exist in 1949. Yet, there are some among us who are determined
to push legislation to block these rules. Some Members of Congress see
a chance to score political points by acting as if something oppressive
is occurring. This could not be farther from the truth.
Under the current regulations--these are the regulations Secretary
Chao is trying to improve--some low-income workers haven't been
protected at all, while some high-income workers and professionals have
used the law to make sure they are paid the overtime rate, time and a
half per hour for any work exceeding 40 hours in a week.
For example, under the current regulations: Only workers earning less
than $8,060 were guaranteed overtime pay because the minimum salary
level had not been updated for nearly 30 years; the descriptions of job
duties required for overtime exemption had been frozen in time for
nearly 50 years, resulting in confusion and uncertainty for both
workers and employers; and, the previous regulations were outdated,
confusing and complex, and have led to an explosion of law suits. That
seems to be the history of our country. Everything is coming down to
litigation.
For a year, the Labor Department has been trying to update these
cumbersome regulations to benefit the American workforce. The new
overtime regulations were not simply conjured up overnight. On the
contrary. Nearly 80 stakeholder organizations, including 16 employee
unions, were invited to participate in meetings with the Department of
Labor.
Over 40 of those organizations attended stakeholder meetings and
provided input on the proposed regulations. The Notice of Proposed
Rulemaking was published in the Federal Register on March 31, 2003.
After a 90-day comment period, the Department of Labor received 75,280
public comments.
I was supportive of the Department's overtime regulations proposed
last

[[Page S4789]]

March; however, some argued that the $22,100 annual minimum salary
level for exemption was too low; the middle-income workers would be
harmed because workers earning more than $65,000 per year might not be
entitled to overtime pay; and, too many workers would be denied
overtime protections.
In an effort to be even more inclusive and respond to the criticisms
from Administration opponents, the Labor Department revised its
proposal--that is after all of the comments--which is the way the
system is supposed to work.
Under the final rule, workers making less than $23,660 a year are
automatically eligible for overtime--this means that 1.3 million low-
income workers will be eligible for overtime pay for the first time in
history.
The new regulations will preserve eligibility for most white-collar
workers making up to $100,000 a year. However, workers making more than
$100,000 who regularly perform some administrative, executive, or
professional duties will no longer automatically be eligible for
overtime. This change will affect 107,000 workers. It doesn't take a
particularly clever politician to see that you might win votes if you
fight to make these high earners higher earners and otherwise carry on
as if a Republican, business-friendly Administration cannot be trusted
to do right by employees.
The final rule strengthens overtime protections for licensed
practical nurses and first responders, such as police officers, fire
fighters, paramedics, and emergency medical technicians, by clearly
stating for the first time that these workers are entitled to overtime
pay. Plain and simple, under the new overtime regulations, 6.7 million
workers are guaranteed overtime status.
I am aware that a week before the Department of Labor's revised rule
was finalized and made publicly available, the AFL-CIO began attacking
the overtime regulations. These tactics reflect a greater interest in
playing politics than in protecting America's workers. Fortunately, the
union movement is not entirely opposed to the regulations. Take for
example the Nation's largest police union, the Fraternal Order of
Police, whose National President, Chuck Canterbury, recently hailed the
Department of Labor's final regulations as an ``unprecedented victory''
for America's first responders. The International Association of Fire
Fighters has said they support the rule going forward. You also won't
be hearing voices of opposition from the Ironworkers, Carpenters, or
Operating Engineers, because they know that the new rule expressly
protects construction workers.

Suing employers about overtime has become very lucrative for trial
lawyers. Why is this the case? Because the current overtime regulations
contain so many ambiguities when applied to the modern workforce,
lawsuits naturally follow. Without a doubt, the Fair Labor Standards
Act is the new playground for plaintiffs lawyers--they are going after
everybody: companies; school districts; local governments; you name it.
Some argue that these lawsuits benefit workers, particularly since they
may win some cases. But, spending an average of 2 years in court to
recover wages workers should have had in their pockets on pay day is
not a benefit. Not surprisingly, workers are getting a few thousand
dollars from these settlements, while trial lawyers are walking away
with millions. These lawsuits are a terrible drain on the economy for
employers and worker groups alike to be spending hundreds of millions
of dollars on such litigation. We ought to be spending these resources
to create new jobs.
I am amazed that the Department of Labor's changes haven't been
enough to satisfy all critics. Presumptive Democratic presidential
nominee Senator John Kerry asserts that the new overtime regulations
``strike a severe blow to what little economic security working
families have left as a result of historic policies.'' That is pure
bunk, and he ought to know it. Somehow, opponents have conveniently
overlooked the Department's good faith efforts in creating today's
overtime regulations.
Are the new rules perfect? No, but they have been welcomed by many
business owners because they will, finally, provide some certainty on
this issue. Contrary to the propaganda being disseminated by its
proponents, under the new overtime rules: ``Blue collar'' workers are
entitled to overtime pay; employers are not relieved from their
contractual obligations under collective bargaining agreements; the
``highly compensated'' test applies only to employees who earn at least
$100,000 per year and who ``customarily and regularly'' perform exempt
duties; the special rules for exemption applicable to ``sole charge''
executives are deleted, strengthening protections for workers under the
executive duties test; a requirement is added that employees who own at
least a bona fide 20 percent equity interest in a business are exempt
only if they are ``actively engaged in its management''; and the
previous requirement that exempt administrative employees must exercise
discretion and independent judgment is maintained.
The department's intent not to change the educational requirements is
clarified for the professional exemption, and defines ``work requiring
advanced knowledge'' as ``work which is predominately intellectual in
character and which includes work requiring the consistent exercise of
discretion and judgment;'' and, terms used in the previous regulations
are retained, but it makes them easier to understand and apply to the
21st Century workplace by better reflecting existing Federal case law.
In addition, the overall length of the regulations has been reduced
from 31,000 words to just 15,000.
Just yesterday, I received a phone call from Cheryl Lake of Draper,
UT. Cheryl has been a human resources professional for over 20 years.
She called my office yesterday in strong support for the Department of
Labor's new overtime regulations. She explained to me how helpful these
new regulations will be for employees and companies alike. Cheryl
expressed major concern about Senator Harkin's amendment, and explained
how complicated and confusing his amendment would make her job. The
Harkin amendment is easy to describe in a brief sound bite, but
impossible to defend on legal, procedural, or economic grounds. The
amendment presumes facts that do not exist and assumes there are no
consequences for its folly.
To anyone who looks at this issue objectively, the decision is a no-
brainer. Reforming the regulations is the right thing to do, and we
need to let the Department of Labor move forward. There is nothing in
the latest revisions that appears either unreasonable or counter to the
spirit of the law. It is possible to argue with some particulars, but
extremely difficult to make the case that the new regulations are
unfair to workers.
The workplace is far different from a half-century ago. Overtime
rules should reflect that.
Workers will be better off. Companies will be better off. I actually
believe trial lawyers will be better off because there won't be any
more of these phony lawsuits where they reap the benefits in comparison
to what the workers themselves get. I think trial lawyers who have
legitimate cases will be able to prove them with more specificity and
will be able to do a better job with their clients than is currently
being done by the abuse of the process because of the ambiguities of
the law. This goes a long way toward getting rid of those ambiguities
and making the law extremely functional compared to the current
regulations.
I want to personally compliment the distinguished Secretary of Labor
for being willing to take this on. This is a type of job that will
always be attacked by those who do not understand these regulations.
This will always be attacked by those who want to keep going the same
system of overlitigation in our society. This will always be attacked
by those who basically don't understand labor law. This will always be
attacked by those who do not want to get things straightened out so
that the system works in the best possible way it can, in the most
efficient and economically sound way, while at the same time expanding
all of the benefits and expanding all of the laws to embrace even more
people than have ever been embraced.
These are very important regulations. I hope our colleagues will
reject the Harkin amendment, which I believe will cause further damage
and harm to our system while not doing anything substantively important
for the workers.
The PRESIDING OFFICER. Who yields time?

[[Page S4790]]

Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from
North Dakota.
The PRESIDING OFFICER. The Senator from North Dakota.

The Federal Deficit

Mr. CONRAD. Mr. President, reading the Washington Post this morning,
I came across this headline which I think is probably the most
misleading headline I have seen in the Washington Post, or, for that
matter, any other publication. The headline in the Washington Post
business section today reads: ``Federal Deficit Likely to Narrow by
$100 Billion.''
Boy, what good news, if only it were true. I think you have to ask
yourself the question: Are they talking about the deficit last year? Is
the deficit this year going to be $100 billion less than the deficit
last year? No. That is not what this story is about. In fact, if you
read this story carefully, what you find is the deficit is going to be
at least $50 billion more than the deficit last year--not $100 billion
less.
The Washington Post has constructed a headline that is about as
misleading as anything I have ever seen a major publication put out.
They have basically fallen hook, line, and sinker for the line put out
by the White House.
Why do I say that? Last year, the deficit was about $370 billion.
According to this story, the deficit this year is going to be $50
billion more--a new record deficit. The headline should be ``Record
Deficit.'' Instead, they are suggesting the deficit is getting smaller.
What are they talking about? They are talking about how the latest
estimate is $100 billion less than the administration's previous
estimate. In other words, they are comparing estimate to estimate--not
what is actually happening, but projection.
When the administration put out their earlier estimate, I said at the
time they were overstating the deficit to set up a story just like this
one. They don't want the headlines to read across America ``Record
Deficits.'' What they did was overstate the deficit in terms of their
estimates so they could come back later and say we are making a big
improvement. There is no improvement, except in estimates.

The fact is, the deficit this year is going to be bigger than the
deficit last year, and the deficit last year was a record.
Unfortunately, all of these estimates understate the true seriousness
of the fiscal condition of our country because they don't count in
addition to this $420 billion, which they now estimate the deficit to
be for this year, and that doesn't include the $160 billion they are
going to take out of Social Security, every penny of which has to be
paid back, and they have no plan to do so. This doesn't include the $50
billion to $75 billion of extra money the Pentagon is going to want for
the war in Iraq and Afghanistan that we now know they are going to have
to ask for.
There are some who suggest they will wait until after the election to
ask for it, but that doesn't change the fact that the money is needed,
that the need is being created now.
If you add all of that together, and the money they are taking out of
the Medicare trust fund, which is another approximately $20 billion,
what you find is they are not going to add $420 billion to the debt
this year. They are going to add close to $700 billion to the debt this
year, by far the biggest in our history--nothing anywhere close to it.
For the Washington Post to fall for this kind of tired old trick--you
know, you overinflate the deficit so that when it comes in somewhat
less than your overestimation you can claim great credit, is a
discredit to the Washington Post. It is a discredit to trying to inform
people of the true fiscal condition of the country. This isn't it. Even
if you accept the premise of this story, the deficit is going to be
about $50 billion more than last year, which was a record. That is
exactly the headline the administration seeks to avoid by having put
out an overestimation of the deficit in order to now claim credit when
the deficit, although a record, is not as large as their earlier
forecast.
I hope the American people are not fooled by this kind of reporting.
I hope the American people are not fooled as to the true fiscal
condition of the country. The truth is, the debt of the United States
is being increased by a record amount.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, I yield to Senator Gregg.
Mr. GREGG. Mr. President, it is my understanding that I am now in a
position to set aside the pending amendments, offer my amendment, and
then they will be voted on in sequence. Are we agreed on that?
Mr. BAUCUS. That is the understanding.
Mr. President, I ask unanimous consent that the pending amendments be
temporarily set aside so the Senator from New Hampshire may offer an
amendment; and after he has spoken on his amendment, the amendments
will be temporarily set aside so that Senator Graham may offer an
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from New Hampshire.

Amendment No. 3111

Mr. GREGG. Mr. President, I rise to speak on the Harkin amendment,
which was pending. It has been set aside by unanimous consent so I may
offer an amendment which can be juxtaposed to the Harkin amendment.
The issue of overtime has been discussed at great length in the last
few days. The debate has been excellent. The Harkin amendment, as it
comes forward, is an attempt to address what the Senator from Iowa sees
as a continuing problem with the regulations as proposed by the
Department of Labor.
We need to review the history of what has happened so we can
understand where we actually are in this process. The rules and
regulations we are dealing with are over 50 years old and have evolved
through a lot of litigation, court decisions, and regulatory activity
into what is a fairly Byzantine and complex set of regulations relative
to who does and does not get overtime in our society.
Under today's law, if you make $8,000, you are guaranteed overtime.
Once you get over $8,000, you do not know what will happen. It depends
on how your job is classified. There is a lot of arcane classification
which comes from the 1930s, 1940s, and 1950s. For example, still in the
law we have things such as straw man and a variety of different titles
which have no relationship to reality in the marketplace as it is today
and the workplace as it is today.
We need to update the regulations. The Department of Labor has done a
very conscientious job in trying to accomplish this and have offered a
set of regulations as a proposed set of regulations. That proposed set
of regulations received 80,000 comments, which is a huge amount of
commentary.
In the Senate, regrettably, it received a lot of hyperbole and attack
as if it were a final regulation versus a proposed regulation. There
were significant misrepresentations that occurred in the process of
attacking these regulations, including representations that under these
regulations there would be a loss of a number of people who would have
the right to receive overtime, something like 8 million people, which
number was arrived at in a totally spurious and inappropriate analysis
done, regrettably, by a couple of folks who either did not understand
the rules or decided to pervert the rules and which led, regrettably,
to a lot of misrepresentation as these rules were said to be affecting
the overtime of over 8 million people.
I return to that argument because it was so bogus and so inaccurate
that it is important to understand how misleading it was as it
represents sort of a theme of inaccuracy relative to the initial
proposed regulations.
That 8 million number, when it was actually analyzed, included 1.5
million individuals who worked part time for less than 35 hours a week
and therefore were not even covered by overtime issues. It included 3.8
million people who were actually technicians or administrative workers
who were already exempt as professionals from this rule. And it
included 1.1 million workers who were paid on an hourly basis and
therefore would continue to be nonexempt under the proposal. It
included 800,000 people who did manual blue-collar work and were
therefore completely exempted from this proposal. And it included
200,000 cooks with 6 or more years of experience who clearly would

[[Page S4791]]

remain covered because cooks are not a category which would be impacted
under this regulation.

So the actual number of that 8 million number, when you actually
analyze it in honest terms, ends up being dramatically less. In fact,
using the analysis and using accurate factual applications to the
analysis as proposed, the number actually comes in below what the
Department of Labor stated their original proposal might be impacted by
this event.
The number was bogus, as has been a lot, regrettably, of the debate
on this issue. The regrettable holding up and obstruction of various
pieces of legislation which have come to the Senate on the theme that
these proposed regulations were basically final regulations and that
they would do massive harm, which harm could not be defended on the
facts.
Now the Department of Labor has taken a look at the 80,000 comments
which it has received and met with innumerable stakeholders, and
listened to all the input of organized labor, from the various other
interests that have a major role in this undertaking, and they put out
final regulations. Interestingly enough, those final regulations are an
extremely aggressive attempt to respond in a positive way to all the
input, the 80,000 items of input, comments which they received.
They have done such a good job in this area. It should be noted that
the Washington Post today, which had opposed these regulations when
they were initially proposed, or at least suggested significant changes
that should be made, has said, and I quote the Washington Post
editorial, not a paper which carries the water of this administration:

What's needed now is not to block these regulations but to
ensure that they are vigorously enforced with an eye to
protecting the vulnerable workers the law was intended to
benefit.

The editorial points out what a good job the Department of Labor is
doing in the enforcement area. That is a simple and accurate reflection
of what the Department of Labor did. They looked at the comments that
came in and they made the significant changes which have now made this
regulation more appropriate and much more effective.
What is the goal of this regulation? The first goal of this
regulation as proposed is to make sure people earning not a significant
amount of money are going to get overtime. So they raise the threshold
from $8,000 to $23,000-plus. If you make in the $23,000 to $24,000
range, you are guaranteed overtime. It does not matter what type of job
you have. If you are considered to be management or whatever, you are
going to get overtime under this piece of legislation in a white-collar
position. That means that 6.7 million people who do not have an
absolute guarantee to overtime today under the present law are going to
have an absolute guarantee to overtime under the new regulation. That
is a major step in the right direction.
It also says if you make more than $100,000 and you are in a white-
collar position--not a blue-color position; you are exempt in a blue-
collar position; you get overtime, even if you make more than
$100,000--if you are in a white-collar position and earn over $100,000,
your overtime may be at issue. It depends on what you do.

Potentially there are 100,000 people, approximately, who may be
impacted by that regulation. In fact, if they are making more than
$100,000, they may be in a management supervisory position so their
overtime may be impacted.
So 6.7 million people who do not get it today or may not get it today
or may be at risk today will be guaranteed overtime. They will get it
for sure. People making more than $100,000 who are in certain job
categories, potentially 100,000 people, their overtime may be impacted,
but it is not absolutely sure. That is what it does as a practical
matter.
What it does, as a more significant point--and this is the whole
purpose of the regulation besides making sure we raise that threshold
from $8,000 to $23,400--what it does is try to put certainty and
definition into the law.
Unfortunately, the law as it has presently evolved over the last 50
years with all this regulation, regulatory changes, and all the court
decisions has really become a Byzantine morass. It is not clear. There
is gray area everywhere and everything is getting litigated. It is the
fastest area of lawsuit growth in the area of labor law. Class action
suits are being brought left and right. The practical impact of that is
employers and employees are suffering because of it. Resources which
should be used to give employees better benefits and to expand
businesses so more people could be hired are being used to defend
lawsuits to try to figure out whether this person's job is a job that
involves overtime or is not a job that involves overtime, fending off
lawsuits left and right, and, as a result, we end up with the
misallocation of resources, fewer jobs being created and fewer benefits
being paid because the dollars are going out to attorneys who are
pursuing these lawsuits because the law is not clear. I don't say the
lawsuits should not be brought but they are brought because the law is
not clear.
The Department of Labor has said they will clarify that and put
certainty in here. That is exactly what they have done with this
regulation. They have made it clear and more certain as to who has the
right to overtime and how those rights evolve. They have done such a
good job of eliciting 830,000 comments that even the Washington Post
has decided this regulation should go forward, or thinks this
regulation should go forward.
Now the Senator from Iowa comes forward with another amendment to try
to stall these regulations. I am not sure what the momentum is behind
that because, as I just mentioned, the practical effect of stalling
these regulations will mean that 6.7 million people who are going to
get their overtime issue clarified and are going to be guaranteed
overtime will have that put at risk, although his amendment tries to
address that. To the extent this remains uncertain through this
legislative process, obviously things aren't going to happen as
effectively as they should.

Secondly, his amendment essentially goes back to a situation where we
are looking at the old law. We are going to go back to the old law to
define how an individual's overtime is paid or whether they have a
right to it. It juxtaposes the old law and the new law. So now an old
law, which was already grossly Byzantine, complex, and unclear, is
going to be brought back into play on top of the new regulations. The
practical effect is, we will have even more litigation, and we will
have to do it by individual jobs.
There is no attempt to address the overall issue in a comprehensive
and systematic way. Instead it says, here is a jump ball. You, the
individual, are going to have to look at the old law, the new law, and
then you the individual and you the individual employer are going to
have to figure out what you are doing with the old law and the new law
before you can figure out what your overpayment is going to be.
The practical implication will be you are going to see a class
ceiling. You are going to have a ceiling because no employer is going
to be willing to move anybody into any position of any responsibility
from where they are already because they aren't going to know what
effect that is going to have on that individual's overtime. They are
going to be buying a lawsuit.
If you are a clerk working in a business somewhere and you suddenly
start to be promoted into a position of maybe taking over some
responsibility and making decisions on who gets what or who doesn't get
what in the area that you have your responsibility within your activity
within that business, you are going to immediately be putting that
business and that company into the issue of whether you have a right
any longer to overtime. It is going to be an individual decision that
company has to make on you, the person who is getting more
responsibility. What is the practical effect of that?
That business, that company is going to say, we don't need that
lawsuit. We are going to go out and hire a new person to do these new
duties who we know won't be subject to any sort of issues relative to
overtime. And you, the person who maybe worked your way up through the
system and have gotten to a point where the people you work with have
confidence in you, they are not going to give you that promotion or
added responsibility because they are not going to want to risk the
cost of a lawsuit that may come with it.

[[Page S4792]]

You are going to create a class ceiling in the whole system as a
result of basically throwing into play again this whole concept of
individuals and old law, which is totally gray, and the new
regulations. It will be chaos in the area of who is and who is not
exempt from overtime, if the Harkin amendment is passed.
So we are offering an alternative. If there is an issue as to any
group as to whether they get overtime, we are going to try to clarify
it once and for all. There have been about 55 groups who have come
forward and said they feel they may be an issue. We don't think most of
them are because we think the regulation is pretty clear for most of
these groups that they basically retain their right to overtime. But
just so there can be no question about it, this amendment specifically
names every one of those groups and says they have the right to
overtime at a minimum. They have the right to their present overtime
situation. If the new law gives them better, puts them in a better
position, they have a right to that. In other words, they either win or
they win more.

I want to list some of these groups because this has been the issue.
When the rubber hits the road is when each group of people who are
going to be impacted get impacted. Some of them have come forward and
said, we have concerns. Firefighters had concerns. Cooks had concerns.
People who were nurses had concerns. In our opinion, the regulations
never impacted those groups, but it is going to be unalterably clear
when this amendment passes.
Let me list some of the 55 groups. These occupations or
classifications will either get what they get now or they will get
anything they might get that is better under the new regulation: Any
worker paid on an hourly basis--that is a pretty broad group, a lot of
people; blue collar workers--that is a lot of people; any worker
provided overtime under a collective bargaining agreement--that would
be true anyway, but we are making it absolutely clear; team leaders;
computer programmers; registered nurses; licensed practical nurses;
nurse midwives; nursery school teachers; oil and gas pipeline workers;
oil- and gasfield workers; oil and gas platform workers; refinery
workers; steelworkers, shipyard and ship scraping workers; teachers;
technicians; journalists; chefs; cooks; police officers; firefighters;
fire sergeants; police sergeants; emergency medical technicians;
paramedics; waste disposal workers; daycare workers; maintenance
workers; production line employees; construction employees; carpenters;
mechanics; plumbers; ironworkers--these people are all covered anyway,
but we are going to list them--craftsmen; operating engineers;
laborers; painters; cement masons; stone and brick masons; sheet metal
workers; utility workers; longshoremen; statutory engineers; welders,
boilermakers; funeral directors--we may want to stick embalmers under
that--athletic trainers; outside sales employees; inside sales
employees; grocery store managers; financial services industry workers;
route drivers; assistant retail managers.
So this amendment basically, once again, goes to the fundamental goal
of this regulation, beyond expanding the people who have an absolute
right to overtime, which, by raising the minimum from $8,000 to
$23,400, this amendment goes to getting clarity, clarity in the law so
that instead of having a lot of lawsuits and a lot of churning in the
marketplace, we can use resources to pay people overtime and to create
new jobs, which is the goal and the purpose of the regulations as they
were proposed by the Department of Labor. I think rather than having
the Department of Labor out here on a whipping post over the last few
days, which it has been regrettably from some Members of the other
side, they should be congratulated for doing exactly what they are
supposed to do.
They put out a proposed regulation. The regulation was a concept
built out of a lot of study and effort. Granted, it wasn't as well
thought out as it might have been. I had reservations about the
regulation. But at the time I said, let's wait until we see the final
regulation before we make any final calls.
Then they listened to the commentary, 80,000 comments, hundreds of
meetings with stakeholders. They had lots of input from organized
labor. They significantly pared back, sifted off, sugared off their
proposal and have designed a regulation which makes basic good sense,
which is that people with low incomes will be guaranteed overtime up to
$23,400, and people who fall above that income level will have a much
more defined understanding of whether they have overtime. We will not
have all this lawsuit confusion and activity which is so draining on
the efficient use of capital.

But to make it absolutely clear, beyond question, that any of the
categories who were in issue and who had a concern during the comment
period will get the best treatment possible, either under the old law
or the new law, we have added this amendment as collateral to the
exercise.
I think with this amendment, people can vote with absolute confidence
on the regulations and support the initiative of these regulations,
which is to make the marketplace fairer for workers.
Mr. President, I send the amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The journal clerk read as follows:

The Senator from New Hampshire [Mr. Gregg] proposes an
amendment numbered 3111.

Mr. BAUCUS. Mr. President, I ask unanimous consent that reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To amend the Fair Labor Standards Act of 1938 to clarify
provisions relating to overtime pay)

At the appropriate place, insert the following:

SEC. __. PROTECTION OF OVERTIME PAY.

Section 13 of the Fair Labor Standards Act of 1938 (29
U.S.C. 213) is amended by adding at the end the following:
``(k)(1) The Secretary shall not promulgate any rule under
subsection (a)(1) that exempts from the overtime pay
provisions of section 7 any employee who earns less than
$23,660 per year.
``(2) The Secretary shall not promulgate any rule under
subsection (a)(1) concerning the right to overtime pay that
is not as protective, or more protective, of the overtime pay
rights of employees in the occupations or job classifications
described in paragraph (3) as the protections provided for
such employees under the regulations in effect under such
subsection on March 31, 2003.
``(3) The occupations or job classifications described in
this paragraph are as follows:
``(A) Any worker paid on an hourly basis.
``(B) Blue collar workers.
``(C) Any worker provided overtime under a collective
bargaining agreement.
``(D) Team leaders.
``(E) Computer programmers.
``(F) Registered nurses.
``(G) Licensed practical nurses.
``(H) Nurse midwives.
``(I) Nursery school teachers.
``(J) Oil and gas pipeline workers.
``(K) Oil and gas field workers.
``(L) Oil and gas platform workers.
``(M) Refinery workers.
``(N) Steel workers.
``(O) Shipyard and ship scrapping workers.
``(P) Teachers.
``(Q) Technicians.
``(R) Journalists.
``(S) Chefs.
``(T) Cooks.
``(U) Police officers.
``(V) Firefighters.
``(W) Fire sergeants.
``(X) Police sergeants.
``(Y) Emergency medical technicians.
``(Z) Paramedics.
``(AA) Waste disposal workers.
``(BB) Day care workers.
``(CC) Maintenance employees.
``(DD) Production line employees.
``(EE) Construction employees.
``(FF) Carpenters.
``(GG) Mechanics.
``(HH) Plumbers.
``(II) Iron workers.
``(JJ) Craftsmen.
``(KK) Operating engineers.
``(LL) Laborers.
``(MM) Painters.
``(NN) Cement masons.
``(OO) Stone and brick masons.
``(PP) Sheet metal workers.
``(QQ) Utility workers.
``(RR) Longshoremen.
``(SS) Stationary engineers.
``(TT) Welders.
``(UU) Boilermakers.
``(VV) Funeral directors.
``(WW) Athletic trainers.
``(XX) Outside sales employees.
``(YY) Inside sales employees.
``(ZZ) Grocery store managers.
``(AAA) Financial services industry workers.
``(BBB) Route drivers.
``(CCC) Assistant retail managers.
``(4) Any portion of a rule promulgated under subsection
(a)(1) after March 31, 2003, that modifies the overtime pay
provisions of section 7 in a manner that is inconsistent

[[Page S4793]]

with paragraphs (2) and (3) shall have no force or effect as
it relates to the occupation or job classification
involved.''.

Mr. BAUCUS. Mr. President, I yield 3 minutes to the Senator from
Florida.
The PRESIDING OFFICER. The Senator from Florida.

Amendment No. 3112

Mr. GRAHAM of Florida. Mr. President, I will soon be offering an
amendment which, it is my understanding, will be debated later today.
As I look at the JOBS bill before us, it seems to me that it has
several purposes. At least two of those purposes are, one, to repeal
the current law which has been found by the World Trade Organization to
be in violation of its standards and, as a result, has caused
retaliatory tariffs to be applied against certain of our American
products.
A second objective of the JOBS bill is to encourage the maintenance
and creation of jobs in the United States of America. The amendment
will strike certain provisions of this proposed law. It will strike the
manufacturers' deduction and changes in the international tax law. Then
it uses the funds that are released by that action to provide for a
manufacturing employers' credit on income tax, based on the payroll tax
of those manufacturing employers.
In my judgment, this alternative better targets the tax incentive to
jobs in the United States of America. The incentives in the underlying
bill are based on corporate profits, not American employment, which I
believe makes them less efficient, less effective, and significantly
less likely to fulfill its title, ``JOBS.''
I will have more to say about this amendment and the concerns we have
about the underlying proposal later today when we debate this amendment
in detail.
Mr. GRAHAM of Florida. Mr. President, I send to the desk an amendment
and ask for its consideration.
The PRESIDING OFFICER. The clerk will report.
The journal clerk read as follows:

The Senator from Florida [Mr. Graham] proposes an amendment
numbered 3112.

Mr. BAUCUS. Mr. President, I ask unanimous consent that further
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BAUCUS. Mr. President, I yield 10 minutes to the Senator from
Massachusetts, with the understanding that I will work to get more time
for him. For the time being, I yield him 10 minutes.
The PRESIDING OFFICER. The Senator from Massachusetts is recognized.
Mr. KENNEDY. Mr. President, I urge my Senate colleagues to support
the amendment of the Senator from New Hampshire when we come about
doing this. I want to say it is not much to bargain, because one of the
principal arguments the Senator from New Hampshire has made is by
listing these 55 new categories, that will provide clarification. To
the contrary, it will provide additional litigation because the test in
the Department of Labor refers to the duties and not to the
professional names that are being used.
So if you have a cook or a chef, does that apply to somebody just
cooking the food or someone at the salad bar who also considers
themselves to be included? Plus, there are additional people who have
not been included as well.
This is a continuation of a misguided policy. We heard in March of
last year from the Department of Labor, under the guise they were
trying to streamline the process and procedure. They issued their
regulations and said only 644,000 people would be affected. Then we
find there were going to be 8 million who would lose overtime. So the
administration retreated on that. Then they promulgated their recent
legislation. Just this morning, Tammy McCutcheon from the Department of
Labor said nobody will lose overtime between $23,660 and $100,000. That
is this morning.

Then we have the Senate Republicans' alleged position to make sure 55
categories, which are basically categories above $23,660 and below
$100,000, will be protected. We are not sure what this is all about. We
know there is going to be a cut in overtime for hard-pressed working
families in America. That is what will be the result.
Let's look at where the record is with regard to middle-income
working families. We know there has been a loss of some 2 million jobs
under this administration. It is not only the loss of jobs, it is the
fact the existing jobs have lost income over the last 2 years. We have
seen the loss of real income in those jobs that exist by about $1,300.
Let's look at this fact. The new jobs being created are paying 21
percent less. This chart shows between 2000 and 2002, we have had a
real loss in wages for existing jobs. If you look at the new jobs being
created, they are paying, on average, 21 percent less. In New York, it
is 38 percent less. So workers are working longer, working harder, and
they are making less income even today.
The cost of the things they are purchasing is going right up through
the roof. If you look at the squeeze for middle-income families, this
chart illustrates it. There is an increase in childcare of 100 percent.
In recent years, an increase of 60 percent in health insurance. In the
last 5 years, mortgage payments have increased 69 percent. Here we find
middle-income, working families, with a loss of 2 million jobs. Those
who are still working have a loss of income. For individuals who are
able to get jobs, they are seeing new jobs paying 21 percent less.
Look what is happening to them in terms of the expenses for middle-
income America. Childcare is going up through the roof, health
insurance is going up through the roof, mortgages are going up through
the roof, and education for their children is going right up through
the roof.
During the Bush years, the middle-class family squeeze has tightened.
This is a net loss of 2 percent in real purchasing terms in wages
between 2000 and 2004. Home prices are up 18 percent; health and other
insurance, as I mentioned, is up 50 percent; tuition, in 5 years, has
gone up 35 percent; utilities have gone up 15 percent.
Everything has been going up except the income of working families.
And we have an administration that is opposed to an increase in the
minimum wage, which has not increased in 7 years; an administration
that is opposed to extending unemployment compensation, and 85,000
American workers are losing their extended unemployment compensation
every week.
Now the administration is taking away overtime at the direct request
of a number of industries. We know what this is all about. We have the
requests from the various industries. The National Restaurant
Association requests the Department of Labor include chefs under the
creative professional category as well as the learned professional
category. Look what happens when DOL puts out their regulation:

The Department concludes that to the extent a chef has a
primary duty of work requiring invention, imagination,
originality, or talent, he will be considered exempt from
overtime.

Thank you very much, National Restaurant Association.
How dare those opposed to this proposal say this is for
simplification. We know what this is all about.
For example, in the insurance industry, here is what this says:

The National Association of Insurance Companies supports
the section of the proposed regulation providing that claims
adjustors, including those working for insurance companies,
satisfy the administrative exemption.

That is the what the National Association for Mutual Insurance
Companies wrote to the Department. Sure enough, look at what happened
when the administration promulgates its regulation:

Insurance claims adjustors generally meet the duties
requirements for the administration exemption.

Thank you very much to the insurance companies.
You talk about simplification--we know what is going on. These are
special interests that are trying to enhance the bottom line.
We can go on with industry after industry. Let's look at what has
happened now in the period of the last 4 years. Here we find a Wall
Street recovery that leaves Main Street behind. Here it is. Corporate
profits. There has been a 57.5-percent increase in corporate profits,
but in workers' wages, it was 1.5 percent.
Do we understand that? Here we have corporate profits of 57.5 percent
and workers' wages of 1.5 percent. Now the administration says workers
are getting paid too much. We have to do something about overtime.

[[Page S4794]]

I do not know what middle-income working families have done to the
Bush administration. I really do not understand why they declare war on
the working families in this country, but it is war. It is a clear
priority that they are not going to be attended to.
We saw recently when we had the whole issue of providing pension
relief for multiemployers, the 9.5 million workers who are working,
small business, and also those in the building trades and others, 9.5
million who were looking for a similar kind of relief that we were
providing for single employers, the administration said no. Those were
9.5 million workers, basically middle-income working families. They
said no to them with regard to retirement; no to increasing minimum
wage; no to unemployment compensation; no overtime. That is the record.
We have the list the administration talks about. They have 55
categories on that list which has been included in the Gregg amendment,
but I do not see the insurance adjustors on that list, I do not see
cashiers on the list, I do not see bookkeepers on the list, and the
list goes on.
Yesterday, when we raised these questions, we were assured: Oh, no,
you just don't understand; you don't really understand. We really
provided the protection.
We have the Department of Labor speaking out of one side of its mouth
in testimony this morning saying one thing, and now we have something
else on the floor of the Senate. Let's get it right, Mr. President.
Let's get it right. Let's adopt the Harkin amendment and make sure we
are going to say to those Americans who are going to have to work
overtime that they are going to be adequately compensated. That has
been the law since the late 1930s: a 40-hour workweek, and if you are
going to work overtime, you are going to get time and a half.
There are some industries that do not have that protection. I remind
workers out there who may be watching this morning that under this
administration, you are going to find out you are no longer provided
with overtime protection.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. BAUCUS. Mr. President, I yield the remainder of my time to the
Senator from Massachusetts.
Mr. KENNEDY. How much time do I have, Mr. President?
The PRESIDING OFFICER. The Senator has 6 minutes.
Mr. KENNEDY. Will the Chair remind me when I have 1 minute remaining,
please.
This chart shows what happens when you do not have overtime
protection. In industries today that do not have overtime protection,
the chances of workers working more than 40 hours a week is 44 percent.
In companies that have to pay time and a half, it is down to 19
percent. For 50 hours a week, we find out it is 15 percent versus 5
percent.
Once we take leave of overtime protections, workers beware. They are
sending a message to you. They can say it is simplification and they
can say it is modernization. We know how to do that. The Harkin
amendment does that. But if you are talking about working longer,
working harder, and making less, you are talking about the
administration's position.
Now we are taking a third bite at the apple. First, the
administration came out with a proposal, and it was defeated in the
Senate and defeated in the House of Representatives. Then they went
back. They took weeks and months to redefine it; then they came back
and made representations, as the Department of Labor spokesman said,
that it was not going to affect anyone between $26,000 and $100,000.
Now we have a third introduction on the floor of the Senate just before
noon today to make sure that the 55 categories, many of which have been
mentioned in the course of the debate, are going to be protected.
Let's just do the job right. Let's just say: Look, American workers
are working longer and harder than any other group of workers. This is
a chart that shows that workers in the United States of America work
longer and harder than any other industrial nation in the world. They
are already working longer and harder. They are having a harder, more
difficult time making ends meet, as I just pointed out, with the cost
of health care, education, mortgage, utilities, the threats to their
pension systems, and the outsourcing of jobs across this country. Let's
not take away from them the one part of their pay which has been there
since the 1930s, and that is the overtime pay. Let's not take that away
from them, too.
That is what the administration is attempting to do. The Harkin
amendment will resist it. I hope when we have that opportunity--I will
vote for the Gregg amendment because it mentions the 55 different
categories, even though I think it probably opens up greater litigation
in terms of defining what is a ``cook'' and what is a ``chef'' and what
is a newspaper person and how that is going to be defined. It is going
to open up litigation. Nevertheless, it is an attempt at least in those
55 areas to make sure they are protected. I am going to vote for that
amendment, but Tom Harkin has the right amendment. It is the right way
to go, and I hope the Senate will follow his lead.
Mr. President, I yield back the remainder of my time.

____________________