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  1. #1
    Join Date
    Apr 2011
    Posts
    3

    Default Variable Rate Overtime

    My question involves employment and labor law for the state of: Arkansas

    Ok, we seem to have a lot of issues at our plant location and a lot of the employees are getting very disgruntled. I work for a soft drink distributor that used to be independent until about four years ago, when we was bought out by a Dr. Pepper snapple group based out of texas. Anyways the pay rate changed from hourly for the merchandisers to a daily pay plus variable rate overtime. Is this legal since the merchandisers don't have any other income/commission or paid incentives? Also the fuel reimbursement has stayed at .40 cents per mile for the past three years and hasn't budged. Guys are getting very disgruntled at work and now there is some talk about getting a union involved or at least scare management so that our complaints don't go on def ears. We know that the workers in texas don't have to put up with this pay structure. Is this legal what this company is doing since its a publicly traded company and the pay and benefits should be universal? Any help would be appreciated. thanks -Tyler

  2. #2
    Join Date
    Jul 2010
    Posts
    3,725

    Default Re: Variable Rate Overtime

    As long as the base pay adds up to minimum wage, they are allowed to pay in any structure they wish. If they are being reimbursed for mileage at .40.mi, they should speak to a tax specialist to see if they are allowed to claim the difference between the .40/mi and the IRS allowed .51/mi on their taxes. Companies are not required to reimburse their employees for mileage as the employee can claim it on taxes. Further, it is not at all out of the ordinary for national companies to pay different wages in different areas.

  3. #3
    Join Date
    Apr 2011
    Posts
    3

    Default Re: Variable Rate Overtime

    But does the company have to give annual cost of living raises? Or does that just vary from company to company?

  4. #4
    Join Date
    Dec 2007
    Posts
    2,360

    Default Re: Variable Rate Overtime

    No, they don't.

    I'm assuming that by "variable rate of overtime", you're talking about this.:
    Section 778.112
    http://ecfr.gpoaccess.gov/cgi/t/text....2.38.2.166.13

  5. #5
    Join Date
    Apr 2011
    Posts
    3

    Default Re: Variable Rate Overtime

    Yes, that would be it. Its called "chinese overtime" around the workplace. Most of these guys work 50-60 hours a week consistently on this type of pay structure. From what I've been reading its legal in every way, but not ethical in most of the employee's eyes. I'm thinking we are going to have to start talking about getting a union involved. As much as I don't care for unions at least the talk of it around the workplace might get some of our requests answered

  6. #6
    Join Date
    Dec 2007
    Posts
    2,360

    Default Re: Variable Rate Overtime

    I hate that term.

  7. #7
    Join Date
    Jun 2006
    Location
    Massachusetts
    Posts
    17,683

    Default Re: Variable Rate Overtime

    That is a very offensive term, just so you know.

    And no, there is no legal obligation to give annual cost of living increases. Or increases at all.

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