The current Wisconsin legislature has been relatively quiet on the development of new employment laws. But a group of Wisconsin Republicans presented some excitement earlier this month with the introduction of Assembly Bill 611. AB 611 seeks to make significant changes to the means by which employees are compensated for overtime work they perform. Rather than paying private sector employees a premium rate for overtime hours worked, AB 611 would give employers and employees the option to provide compensatory time off instead.
Current federal and state law provides that private sector employees must be paid at a rate of 1.5 times their regular rate of pay for all hours worked over 40 in a workweek. This rate is otherwise known as a premium rate and applies to all workers unless a position falls under an exemption from this requirement. The original intent of the premium rate obligation was to provide employers a disincentive from requiring employees to work more hours. Rather, the overtime requirement would make it more affordable for employers to create additional job opportunities for other individuals to enter the workforce.
Public sector employers, or government employers, have the unique ability to provide compensatory time, or “comp time,” in lieu of overtime compensation. An employee receiving compensatory time gets time off from work instead of payments at a premium rate. This different means of handling overtime compensation provides a real cost savings alternative to public sector employers that is not available in the private sector.
The sponsors of AB 611 tout the legislation as affording employers and employees flexibility in the workplace. In its current form, both sides of the employment relationship must agree before compensatory time could be provided instead of overtime. Opponents question whether employees will truly be in a position to voluntarily agree to the compensatory time off alternative and note the financial harm families will feel if they miss out on overtime pay. Check back often to the Walcheske & Luzi Employment Law Blog for updates on the progress of AB 611.