President Obama visits the University of Wisconsin at La Crosse on Thursday to detail a labor initiative that’s cheering workers at retail stores and restaurants while alarming their owners.
By the time the president’s proposed change in federal rules on overtime pay could take effect next year, however, it might also generate similar divisions among college administrators and their workers.
The basic thrust of the proposal is to raise, from $23,660 to $50,440, the annual salary cutoff below which workers are generally eligible for a time-and-a-half wage rate for work that exceeds 40 hours a week.
That change, the Obama administration estimates, would help nearly five million workers, many in retail and food services, whose employers manage to avoid paying the overtime rate by classifying them as managerial.
Colleges and universities, however, are not bystanders in the matter. Teaching positions are exempt from the overtime rule, at least for now. But most of the workers on American college campuses are outside of teaching, and the economic effect of the change could be significant, according to several labor lawyers.
"I certainly expect that this salary threshold is going to impact higher education," said Lisa A. Schreter, chairman of the board at Littler Mendelson, a law firm that represents management in employment cases.
That’s especially true if the process of changing the rule leads to a reconsideration of the teaching exemption, said William A. Herbert, executive director of the National Center for the Study of Collective Bargaining in Higher Education and the Professions at Hunter College of the City University of New York. "It would be prudent for colleges and universities to re-examine the situation," he said.
The administration’s plan on overtime wages is the latest in a series of steps by Mr. Obama to creatively find areas where he can advance his policy goals — in areas that include the environment, foreign policy, immigration, and gun control — in the absence of cooperation from the Republican-led Congress.
In this case, the changes in overtime-pay policy are being pursued by the Department of Labor through a standard rule-making mechanism for setting the exact definitions and boundaries of laws previously approved by Congress. The process is expected to take a little more than a year — just enough time for Mr. Obama to see them take effect before his second and final term expires.
Jobs on Campuses
Various experts in higher education and labor relations said they could not predict exactly how many workers on college campuses would be affected by the proposed change, though it could be several hundred thousand nationwide.
American institutions of higher education employ more than 3.8 million people, according to government data cited by the College and University Professional Association for Human Resources. That figure includes more than 1.5 million faculty members; 238,000 people in executive, administrative, or managerial positions; 800,000 in other professional positions; and more than 900,000 in other positions not exempted from federal overtime rules, the association said.
Many entry and midlevel professional positions — including many in student life, development, administration, and academic affairs — pay less than $50,440 per year, said Andy Brantley, the association’s president and chief executive officer.
An increase in the overtime threshold "was long overdue," Mr. Brantley said. "Unfortunately, a change of this magnitude will have a significant impact for every campus."
The effect will be most pronounced for colleges in parts of the country that have lower average wages and lack state laws that already set stricter rules on overtime pay, said Tara E. Daub, a partner at the law firm Nixon Peabody.
Colleges will have to absorb that cost in some way, such as cuts in services or tuition increases, said Shannon D. Farmer, a partner at Ballard Spahr, a law firm with clients in higher education. And the effect would linger, she said, as Mr. Obama’s proposal calls for automatic increases in the future tied to average incomes.
Worries About an 'Ambush'
Even more concerning, Ms. Farmer said, is the possibility that the Department of Labor will end or revise the exemption for teaching positions. That exemption also applies to many doctors and lawyers, who, along with professors, are in positions that are either relatively well paid or involve wide fluctuations in numbers of hours worked each week, she said.
The administration’s proposed change does not explicitly suggest repealing the teaching exemption, she said, though it does invite comments on it. "So what people are concerned about is that there is going to be basically an ambush rule here," where the Department of Labor might endorse a change in the teaching exemption later in the process, she said.
That type of change — sought by many advocates of adjuncts as part of an overall campaign for improving pay and conditions for part-time, non-tenure-track faculty members — could perhaps happen some day, said Ms. Daub, a member of Nixon Peabody’s Labor and Employment group. But it won’t happen in the current rule-making process, she said, because revising the teaching exemption has not been included in the terms of the initial proposal.
"It would have to go through the whole notice-and-comment period," said Ms. Daub, who was scheduled to address the topic on Wednesday morning at the annual conference of the National Association of College and University Attorneys in Washington. "They can’t just slip that in at the end."
Either way, at least one university doesn’t seem especially concerned. At the University of Wisconsin at La Crosse, Mr. Obama’s scheduled visit on Thursday to outline the plan is largely a matter of celebration, given that it will be the first time a sitting U.S. president has ever visited the campus. It’s "an historic opportunity for our UW-L community," the chancellor, Joe D. Gow, said in a campuswide email.
The campus’s vice chancellor for administration and finance, Robert J. Hetzel, said he hadn’t looked at the plan, which Mr. Obama publicly outlined in an op-ed on Monday in The Huffington Post, or tallied its possible effects on Wisconsin-La Crosse. "I’m not able to comment on this matter as we haven’t seen the proposal," Mr. Hetzel said.
Read more at The Chronicle of Higher Education: http://chronicle.com/article/Obama-s-Overtime-Proposal/231287