Warren, Brown Open Investigation into 23 Companies’ Overtime Avoidance Practices and Possible Wage Theft
Companies Label Workers As “Managers” to Deny Workers Billions in Overtime Pay
Washington, D.C. – United States Senators Elizabeth Warren (D-Mass.) and Sherrod Brown (D-Ohio) launched an investigation into 23 companies that appear to have committed wage theft by denying low-wage workers overtime pay by abusing the label “manager.” The senators sent letters to 23 companies identified in a recent report as having the highest proportion of positions used to strategically avoid paying workers overtime –– Bojangles, 84Lumber, Arby’s, Sonic Drive-in, Spencer’s, Weis Markets, Pizza Hut, Domino’s Pizza, Combined Insurance, Jiffy Lube, Popeyes, Burger King, GNC, H&R Block, Life Time Fitness, Dairy Queen, Boston Market, Mainsource Bank, Subway Sandwiches, Jimmy John’s Little Caesars, Crossmark, OfficeMax, and KFC – and called on each company to immediately cease its overtime evasion practices and answer questions regarding its tactics of “managerial” titles to avoid paying workers overtime.
“Firms appear to have systematically misclassified workers that spend the majority of their time performing manual labor tasks as managers—using titles like ‘director of first impressions’ and ‘assistant bingo manager’ – to deny them billions of dollars in overtime pay… By ‘provid(ing) salaries just above the federal cutoff to frontline workers and mislabel(ling) them as managers,’ (each company) appears to have committed wage theft by evading its statutory duty to pay workers what they have earned,” wrote Senators Warren and Brown.
The senators wrote to 23 companies identified by a recent National Bureau of Economic Research report as having the highest proportion of positions used to strategically avoid paying workers overtime. The Fair Labor Standards Act (FLSA) of 1938 prevents workers from being forced to work excessive hours without additional compensation: if covered employees work more than 40 hours in a given work week, they must receive overtime pay at one-and-a-half times their regular pay rate. Salaried employees who earn less than the federal overtime threshold of $35,568 annually are automatically eligible for overtime pay. However, the FLSA overtime guarantee does not apply to workers with salaries above that threshold and bona fide “managers”: executive, administrative, and professional employees.
In the letters, the senators note that each of these 23 companies have abused overtime regulations by labeling workers as “managers” while paying them just above the salary threshold, appearing to have committed wage theft by evading its legal duty to pay workers what they have earned.
Given these serious concerns, Senators Warren and Brown are demanding each company immediately stop its wage theft tactics and pay employees the overtime pay they have earned. They are asking each company to respond to a set of questions about the scope of its use of managerial titles and corresponding salaries and provide information about its overtime spending by July 11, 2023.
Senator Warren is an outspoken advocate for worker’s rights and holding giant corporations accountable for violating labor protections:
- In May 2023, Senators Warren and Jacky Rosen (D-Nev.) and Representative Nikema Williams (D-Ga.) reintroduced the Sunlight in Workplace Harassment Act, legislation to require large, public corporations to publicly report all settlements and judgments related to incidents of discrimination, harassment, and sexual abuse each year.
- In April 2023, Senators Warren (D-Mass.) and Richard Blumenthal (D-Conn.) and Representatives Pramila Jayapal (D-Wash.), Annie Kuster (D-N.H.), Ilhan Omar (D-Minn.), and Don Beyer (D-Va.) led over 60 of their colleagues in a letter to Federal Trade Commission Chair Lina Khan, urging the agency to move forward with their proposed rule banning noncompete agreements to give approximately 30 million Americans the opportunity to change jobs and create new businesses.
- In March 2023, Senators Warren and Brown sent a letter to the Federal Reserve Bank of New York and Sodexo Group to express support for the food service workers of UNITE HERE Local 100 as they begin contract negotiations.
- In February 2023, Senators Warren and Sheldon Whitehouse (D-R.I.) sent a letter to the U.S. Chamber of Commerce calling out the organization for its opposition to the Federal Trade Commission’s proposed rule that would ban employers’ use of noncompete agreements. The senators are calling on the Chamber to explain why it is undermining its stated values by opposing this business-, worker-, and consumer-friendly policy.
- In February 2023, Senators Warren, Bernie Sanders (D-Vt.), and Ron Wyden (D-Ore.) pushed for accountability in a letter to Kroger, after its shift to a new payroll system left thousands of workers across the country short on their paychecks. They pressed the grocery giant on how it will compensate impacted workers and whether the potential Kroger-Albertsons merger would worsen mistreatment of workers.
- In January 2023, Senators Warren and Representative Cori Bush (D-Mo.) wrote to the Department of Labor’s Wage and Hour Division in support of its October proposed rule on employee status which would help reclassify potentially thousands of misclassified workers.
- In October 2022, Senators Warren, Sanders, Edward J. Markey (D-Mass.), and Richard Blumenthal (D-Conn.) blasted Starbucks CEO Howard Schultz for the company’s union-busting campaign, including its ongoing and illegal weaponization of benefits against unionizing workers.
- In June 2022, Senators Warren and Markey and Representative Garcia introduced the Good Jobs for Good Airports Act, legislation that would provide airport workers with the pay, benefits, and labor standards they deserve after serving on the frontlines of the nation’s aviation system and keeping airports safe through a global pandemic.
- In June 2022, Senators Warren, Cory Booker (D-N.J.), and Sanders and Representatives Bush and Alexandria Ocasio-Cortez (D-N.Y.) wrote to Amazon’s President and CEO, demanding answers about the company’s proposed worker chat application, which reportedly would ban workers from using certain words and phrases, restricting their ability to discuss their working conditions and basic legal rights, including unionization.
- In May 2022, Senators Warren and Representatives Bush and Ocasio-Cortez wrote Amazon’s Executive Chairman, Jeff Bezos blasting the company for its failure to answer their questions about policies that led to the collapse of an Amazon warehouse in Edwardsville, Illinois, which killed six workers.
- In February 2022, Senator Warren and Representatives Jan Schakowsky (D-Ill.), Rosa DeLauro (D-Conn.), Barbara Lee (D-Calif.), Ayanna Pressley (D-Mass.), and Katie Porter (D-Calif.) announced the introduction of the Part-Time Worker Bill of Rights Act. The legislation would strengthen protections for part-time workers and allow them to better balance their work schedules with personal and family needs.
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