Slave labor

I received a call from my tenant yesterday. She works for a fast food chain as a manager and said that she was going to be late paying the rent because she is a “manager.”

She said that as she was a “manager” she doesn’t receive overtime, although she didn’t know that until yesterday after working over seventy hours last week to make extra money… to pay the rent on time.

I was sympathetic, and will wait.

Coincidentally, President Obama announced that he was going to (get more Democratic Party votes next year) try to close the “manager” loophole used by companies to create slave labor from their low paid service managers.

They call them “managers” or “assistant managers” to avoid paying them overtime and working them like slaves.

The Fair Labor Standards Act of 1938 was initially passed to create a minimum wage, a standard forty hour work week, overtime pay and so on. It exempted salaried employees from receiving overtime.

“Managers” do not get overtime if they make more than a minimum income and that definition defined how retail businesses, such as restaurants, make people managers or assistant managers and work them to death doing the same job as hourly workers but without the overtime.

As an aside, another recently released report stated that fifty-three percent of American workers say that they have job burnout. I wonder how many “managers” are on that list?

So if you were classified as a “manager” and earned a salary you aren’t entitled to overtime. The regulators said that if you made under $23,700 in 1975, the last adjustment, you had to be paid hourly, and over that you could be paid hourly or become a “manager” and receive a salary.

So burnout or not, this is what the American worker has become –

That $23,500 in 1975 was a very good income. It’s a poverty level income today. Ignoring taxes, that $23,700 is the equivalent of $104,758 in 2015!

Although my Republican friends are in opposition I actually support closing this loophole, but Mr. Obama doesn’t go far enough. The problem is that the management salary threshold was last set in 1975 when money was worth something.

Unfortunately, our president has shown his weakness by asking for the $23,700 be adjusted to only about $50,000, as he doesn’t have the nerve to adjust it to ~$105,000 with annual increases based on inflation. That would cover almost every worker and the “manager” abuse would be dealt with.

I suspect that the lower amount was chosen to pick up most of the blue collar, Democratic Party voters. It will not benefit the Republican voters who will still vote Republican. It will help energize the Democratic Party voters in next year’s presidential election and get Mrs Clinton elected president.

I further suggest that there shouldn’t any threshold for hospitality or service jobs, such as restaurants, stores, hotels and any retail businesses where the “management” deals with customers. That will stop the slave labor loophole. It needs to be stopped.