Federal Regulation of Working Hours: Consideration of the Issues Through the 105th Congress

Federal Regulation of Working Hours: Consideration of the Issues Through the 105th Congress

97-532 E
CRS Report for Congress
Received through the CRS Web
Federal Regulation of Working Hours:
Consideration of the Issues
Through the 105th Congress
Updated May 24, 1999
William G. Whittaker
Specialist in Labor Economics
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

ABSTRACT
Legislation to modify the overtime pay requirements of the Fair Labor Standards Act to
permit more flexible work scheduling for private sector workplaces has been under
consideration through the 104 and 105
th
th Congresses. This report summarizes hearings, floor
debates and related documents produced during those two congresses. It will not be updated
further.

Federal Regulation of Working Hours: Consideration of the
Issues Through the 105 Congress
th
Summary
The 104 and 105
th
Congresses actively considered legislation to alter the 40
th
-
hour workweek under the Fair Labor Standards Act (FLSA) and to modify the Act’s
overtime pay requirements. These initiatives proposed alternative work scheduling
options for the private sector, such as compensatory time off, compressed scheduling,
and flexible credit hours.
In the 104 Congres
th
s, hearings on workhours regulation were conducted in the
House of Representatives and in the Senate respectively on H.R. 2391 (Ballenger) and
S. 1129 (Ashcroft). On July 30, 1996, the House passed H.R. 2391 (comp time); the
measure was not considered by the Senate. In mid-1996, President Clinton proposed
flexible workhours legislation, going beyond the FLSA by urging expansion of the
Family and Medical Leave Act (1993). Sent to Congress in the fall of 1996, the
Clinton proposal was not acted upon.
Modification of the 40-hour workweek standard was urged by the industry-
oriented Labor Policy Association and the Flexible Employment Compensation and
Scheduling Coalition (FLECS), among other groups and individuals. It was opposed
by the AFL-CIO, by certain women’s advocacy groups, with other individuals. The
initiative died at the close of the 104 Congress but it sparked considerable interest
th
within Congress and a spirited public debate.
Early in the 105 Congress, alternative work scheduling legislation was agai
th
n
introduced: S. 4 (Ashcroft) and H.R. 1 (Ballenger). The bills were almost
immediately the subject of hearings in the Senate and the House. On March 5, 1997,
the Committee on Education and the Workforce reported H.R. 1; on March 19, 1997,
it was passed by the House. In early April, 1997, the Senate Committee on Labor and
Human Resources voted to report S. 4; but, when floor consideration was attempted,
the measure was blocked when a series of cloture votes failed. The legislation died
at the close of the 105 Congress.
th
These proposals were technical and contentious. Hearings, continuing
intermittently through two Congresses (March 1995 to early 1997), produced sharply
differing opinions. Was such legislation needed? If so, what form should it take?
And, would the proposed measures have the effect of setting aside the 40-hour pre-
overtime pay standards of the FLSA and, in the process, vitiate worker protections?
Central to the debate was worker choice. Would participation in an alternative
workhours program and use of earned comp time or credit hours, etc., be at the
discretion of the worker or at the direction of the employer? Conversely, how much
worker protection (with regulatory and reporting requirements) could be built into the
legislation without rendering it unattractive to employers?
Evolution of these proposals through the 104th and into the 105 Congresses is
th
dealt with in CRS Report 96-570, Federal Regulation of Working Hours: An
Overview. This report focuses upon comp time and related issues through the close
of the 105 Congress.
th

Contents
Introductory Comment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Overtime Pay and Comp Time: The 104 Congress
th
. . . . . . . . . . . . . . . . . . . . . . 3
The Ballenger Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Early House Hearings of 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
March 30, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
June 8, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Witnesses, Generally Supportive of Amending the FLSA . . 6
Some Witnesses, Generally Skeptical of FLSA Amendment
7
Questioning from the Subcommittee . . . . . . . . . . . . . . . . . . 9
The Ballenger Bill (H.R. 2391) as Introduced . . . . . . . . . . . . . . . . . . 12
The Hearings Resume . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
An Overview of the 1995 House Hearings . . . . . . . . . . . . . . . . . . . . 17
H.R. 2391 Reported from Committee, July 1996 . . . . . . . . . . . . . . . 19
Modifications in the Bill as Reported . . . . . . . . . . . . . . . . . . . . 19
Comments from the Majority . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Comments from the Minority . . . . . . . . . . . . . . . . . . . . . . . . . . 21
H.R. 2391 Called Up in the House, July 1996 . . . . . . . . . . . . . . . . . . 24
Consideration of the Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Floor Consideration of the Bill . . . . . . . . . . . . . . . . . . . . . . . . . 27
Amended Version Passed by the House . . . . . . . . . . . . . . . . . . 29
The Ashcroft Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
General Provisions of S. 1129 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
The Senate Hearing, February 1996 . . . . . . . . . . . . . . . . . . . . . . . . . 32
Comments by Senator Ashcroft . . . . . . . . . . . . . . . . . . . . . . . . 32
General Testimony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Pay Docking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
The Worker’s Choice? . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
An Overview of the Hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Overtime Pay and Comp Time: The 105 Congress
th
. . . . . . . . . . . . . . . . . . . . . 36
Workhours Legislation Reintroduced . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
The New Ballenger Bill (H.R. 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
The New Ashcroft Bill (S. 4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Compensatory Time Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Biweekly Work Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Flexible Credit Hour Program . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Salary Practices Relating to Exempt Employees . . . . . . . . . . . . 39
Hearings of the 105 Congress
th
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
The Senate: Opening Hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
The House: Opening Hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
The Senate: A Second Hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Concluding Comment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Federal Regulation of Working Hours:
Consideration of the Issues
Through the 105th Congress
During the 104 and into the 105
th
Congress, there was an initiative to permi
th
t
modification of the 40-hour workweek standard under the Fair Labor Standards Act
and the Act’s overtime pay requirements. This report examines workhours issues
raised in recent congressional hearings, floor debates, and related documents. To the
extent feasible, it uses the actual language of proponents and critics of alternative
scheduling concepts. It is intended to serve as a supplement to CRS Report 96-570,
Federal Regulation of Working Hours: An Overview, which traces the evolution of
federal workhours regulation with the legislative history of the several bills.
Workhours legislation received committee and floor consideration during both
the 104th and 105 Congresses. For the most current information about pendin
th
g
legislation, please consult the Legislative Information System (LIS) at
[http://www.congress.gov].
Introductory Comment
Speaking generally, the Fair Labor Standards Act (FLSA) of 1938, as amended
through the years, requires that a worker receive not less than one-and-one-half times
his (or her) regular rate of pay (time-and-a-half) for hours worked in excess of 40 per
week. Within a 40-hour workweek (taking into account the terms of any collective
bargaining agreement that might be in place), the employer is allowed reasonable
flexibility. Any configuration of hours is permitted within the 40-hour weekly pattern
(e.g., 5 days of 8 hours, 4 days of 10 hours, 2 days of 20 hours) so long as the total
hours worked do not exceed 40 in a single week. Within that context, flexible hours
of work, compressed scheduling and comp time are permitted. By the early 1990s,
just over 76 million nonsupervisory employees were covered by the overtime pay
provisions of the Act.1
Beginning in the late 1960s, various initiatives were proposed that would have
altered workhours regulation with respect to federal employees, permitting wider
flexibility: i.e., alternative work scheduling. In 1978, Congress adopted legislation
setting in motion a period of experimentation with flexible and compressed work
scheduling for federal employees — an initiative that became permanent after 1985.
That same year, the U.S. Supreme Court ruled that employees of state and local
1 U.S. Department of Labor. Employment Standards Administration. Minimum Wage and
Maximum Hours Standards under the Fair Labor Standards Act (Section 4(d)(1) Report).
Washington, 1993. p. 25. For the Fair Labor Standards Act, see 29 U.S.C. 201 ff.

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governments were protected by the Fair Labor Standards Act. Following public
discussion and hearings, Congress amended the FLSA to allow state and local
government employers to offer compensatory time off instead of cash overtime pay
to their workers. Given these public sector precedents, some suggested a similar
arrangement for private sector employers.
In March of 1985 (and for a number of years thereafter), Senator Malcolm
Wallop (R-Wyo.) proposed legislation setting aside the 40-hour workweek
requirement of the FLSA to allow employers, with worker consent, to trade overtime
hours worked for subsequent paid time-off (comp time). The workers would have
accrued comp time on a straight time basis: one hour of overtime worked (i.e., hours
worked in excess of 40 per week) for one hour of paid comp time. This would have
freed employers from the overtime pay (time-and-a-half) requirements of the FLSA,
thus reducing their labor costs. The workers would have lost the added cash value
of overtime pay (time-and-a-half) while the income earned through working extra
hours (in excess of 40 per week) would have been deferred: that is, taken as paid
time off when it would not disrupt the employer’s business. The legislation was not
enacted, but interest in changing the FLSA 40-hour workweek standard for the
private sector remained. By the mid-1990s, such legislation was again under active
consideration.
In the 104 Congress, Senator Ashcroft introduced S. 1129
th
providing, inter alia,
for comp time, compressed scheduling, and flexible credit hours. H.R. 2391 was
introduced by Representative Ballenger: a more limited proposal that would have
extended the comp time option, available to state and local government employers,
to those of the private sector. The House Subcommittee on Workforce Protections
conducted a series of hearings dealing with a broad spectrum of workhours issues
(March, June, October and November, 1995). H.R. 2391 was passed by the House
on July 30, 1996. A hearing on S. 1129 was conducted by the Committee on Labor
and Human Resources (February 1996).
In the 105 Congress, Senator Ashcroft introduced S. 4, a somewhat modified
th
version of his earlier proposal. Representative Ballenger introduced H.R. 1, a bill
similar to that approved by the prior Congress. In February 1997, hearings were
conducted both in the House and Senate.
The language of these proposals evolved as the bills have moved through the
legislative process; their purpose, however, seems to have remained constant. Here,
after a brief introduction, we follow, sequentially, consideration of alternative
scheduling through the hearings of the 104 and 105
th
Congresses, the concepts set
th
forth in the House report on H.R. 2391 (1996), and the House floor debates of the
104
th Congress. Some arguments appear to have remained unchanged throughout the
period; others were modified.

CRS-3
Overtime Pay and Comp Time: The 104 Congress
th
In the 104 Congress, more than two dozen bills urged amendment of th
th
e
FLSA.
2 Several dealt specifically with alternative workhours structures: notably, S.
1129 (Ashcroft), with a similar measure in the House, H.R. 2723 (Doolittle); and
H.R. 2391 (Ballenger).
The Ballenger Proposal
Early in the 104 Congress, the House Subcommittee on W
th
orkforce Protections,
chaired by Representative Ballenger, conducted oversight hearings on aspects of the
FLSA including comp time and compressed scheduling. On September 21, 1995, Mr.
Ballenger introduced H.R. 2391, the “Compensatory Time for All Workers Act of
1995.”
The Early House Hearings of 1995. The House hearings were divided into
two sets: March and June, 1995, prior to introduction of H.R. 2391; and November,
1995, when H.R. 2391 was before the Subcommittee. The early hearings addressed
general issues of overtime and workhours flexibility. The November hearing focused
more nearly upon H.R. 2391: to refine its concepts and add worker protections.
3
March 30, 1995. The central issues emerged early. Chairman Ballenger began:
“The FLSA was developed for a manufacturing-based economy composed of a largely
male workforce. Since them,” he stated, “the functions of the workplace and the
demographics of the workforce have changed dramatically.” “In order to remain
competitive,” Mr. Ballenger said, “every U.S. firm is looking for ways to increase
flexibility and productivity.” Meanwhile, “[e]mployees are looking for ways to juggle
work, family and personal needs. All too often, the FLSA serves as an impediment
to these goals.”4 Conversely, Representative Owens, the Subcommittee’s ranking
minority member, affirmed that the FLSA “already allows flexible work schedules,”
2 Early in the 104th Congress, the FLSA was extended to legislative branch employees (P.L.
104-1, signed January 23, 1995). Later, Congress: exempted state and local official court
reporters, under certain conditions, from the overtime pay provisions of the Act (P.L. 104-26,
signed September 6, 1995); modified child labor practice under the Act with respect to certain
hazardous types of work (P.L. 104-174, signed August 6, 1996); and approved general FLSA
amendments dealing with the federal minimum wage and related issues (P.L. 104-188, signed
August 20, 1996).
3 S. 1129 (Ashcroft) was introduced on August 7, 1995, but no hearings were held until
February 1996. The House Subcommittee on Workforce Protections conducted a hearing on
overtime pay issues, generally unrelated to H.R. 2391, on October 25, 1995.
4 U.S. Congress. House. Subcommittee on Workforce Protection, Committee on Economic
and Educational Opportunities. Hearings on the Fair Labor Standards Act. Hearings, 104th
Cong., 1st Sess., March 30, June 8, October 25, and November 1, 1995. Washington, U.S.
Govt. Print. Off., 1995. p. 1-2.

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adding: “...the real issue is not flexibility, the real issue is fairness and paying
Americans for the work they do.”5
Consideration of flexible hours options began with testimony from the industry-
oriented Labor Policy Association (LPA).6 An LPA report, Reinventing the Fair
Labor Standards Act To Support the Reengineered Workplace (October 7, 1994),
part of the hearings record, seemed largely to set the tone for what would follow.
The LPA analysis argued that the FLSA (with its workforce protections) was old and
out-of-date: in the realm of labor laws, holding “a position nearly comparable to that
of the Dead Sea Scrolls.” The FLSA, it charged, discourages “progressive
employment practices” such as “allowing employees to deviate from the standard 40-
hour workweek” and “`paying’ employees for overtime with time-and-a-half
compensatory time” rather than cash.7
Industry demand for employee time, the LPA noted, may be somewhat
unpredictable: “...one week may involve considerably less than 40 hours and the next
week may involve considerable more.” And, thus, “an employee who works 50 hours
one week must be paid overtime even if he or she only works 30 the next.” An
alternative had occurred to the LPA.
If the Act were to operate with a monthly or quarterly focus, this
wouldn’t occur. Thus, an employer could allow an employee to only work
10 hours one week and then make up for that time later in the month by,
for example, working three 50-hour weeks.
In addition to this concept (compressed scheduling), the LPA urged a comp time
option — presented as worker friendly. It observed: “The lack of flexibility imposed
by the FLSA when compensating employees for overtime work adds to the
employer’s burden by making it difficult to keep costs down” — a factor, it noted, in
establishment of a comp time option for local government employees. “To assume
that businesses struggling to compete in today’s global marketplace do not also bear
‘substantial financial responsibilities’ makes no sense.”8
Maggi Coil, testifying both for Motorola, Inc. (where she was Compensation
Director), and for the Labor Policy Association, asserted that the FLSA was dated.
She served, she noted, on the LPA’s FLSA Reform Task Force searching for “ways
to bring a more than 50-year-old piece of labor law into the 20 century.” The Act,
th
5 House Subcommittee on Workforce Protections, Hearings, 1995. P. 2.
6 The Washington-based Labor Policy Association “is a public policy advocacy organization
of the senior human resource executives of American’s major corporations whose purpose is
to ensure that U.S. employment policy supports the competitive goals of its member
companies and their employees.” See LPA homepage on the Internet: [http://www.lpa.org/-
lpa/about.html], January 22, 1997. LPA member companies “are typically represented in
LPA by their principal employee relations executive.” See LPA Annual Report 1988.
Washington, 1988. p. 1.
7 House Subcommittee on Workplace Protections, Hearings, 1995. p. 30-31.
8 House Subcommittee on Workforce Protections, Hearings, 1995. p. 33-35.

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she suggested, was crafted during an “employer’s market” (the Great Depression).
“Jobs today,” she pointed out, “are significantly different than they were in 1938...”
and the FLSA “as currently written is one of the things that has outlived its usefulness
and demands renovation.”9
With a similar focus, J. Thomas Higginbotham of the American Institute of
Certified Public Accountants had written to Chairman Goodling of the full committee,
urging enactment of comp time legislation.
... employees would be able to receive one and one-half hours of compensatory
time off in lieu of overtime pay. We believe that employees should have this
option. To ensure that there is mutual acceptance on the part of both employer and
employee, there should be an agreement between the employer and employee prior
to the performance of the work.
Higginbotham urged that comp time “should be used by the employee within one
year, in order to prevent excessive accumulation” of such hours.10
June 8, 1995. Chairman Ballenger opened the June hearing by affirming that
flexible schedules are “high on the list of issues of major concern to most employees”
and that the FLSA “in its current form, works against flexibility in the workplace.”
The Act, he said, “stands in the way of companies who attempt to utilize flexible
human resource strategies in order to allow workers to pursue more fulfilling
combinations of work, family life and other interests.”11
Representative Owens viewed the issue differently. “Today we begin a full press
attack on the 40 hour work week and overtime.” He queried, “what is the motive for
attacking the 40 hour week, and for attacking overtime? We can only conclude that
it is monstrous employer greed.” “Tell me, Mr. Chairman,” Mr. Owens asked
rhetorically, “how will we justify ... giving employers sole custody over the
employee’s work schedule by allowing them greater flexibility beyond the 40 hour
work week? We cannot justify any of these actions,” he argued, “for they are a
blatant exploitation of the American worker.” Mr. Owens explained:
Overtime provisions are under attack, and we will be told that it is too much to ask
employers to pay employees one and a half times their hourly rate for overtime.
We will be told that private sector workers want to receive compensatory time off,
rather than money for their overtime. The questions are, will the employees be
given an opportunity to choose? Will they have discretion as to when they take the
time? And, who will ensure that the employees in the private sector receive the
compensatory time they are entitled to if the company goes out of business?
9 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 16-19. Ms. Coil
explained that the LPA’s Task Force “included more than 50 LPA member companies.”
10 House Subcommittee on Workforce Protections, hearings, 1995. p. 160. The American
Institute of Certified Public Accountants is identified as a member of the FLECS (Flexible
Employment Compensation and Scheduling) Coalition, a group largely of industry members
including the Labor Policy Association. See, ibid, p. 185.
11 House Subcommittee on Workforce Protections, Hearings, 1995. p. 169-170.

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These issues, the focus of the hearings, Mr. Owens asserted, “all add up to an unprecedented
assault on the income and the quality of life of working Americans.”12
Witnesses, Generally Supportive of Amending the FLSA. The lead witness was
Arlyce Robinson, Administrative Support Coordinator for Computer Sciences
Corporation of Falls Church, Virginia. Ms. Robinson urged increased workhours
flexibility. The FLSA, she noted, “was intended to protect us, maybe 50 years ago
it did,” but in the modern workplace, it prevents flexibility.13
Kathleen M. Fairall, Senior Human Resource Representative, The Timken
Company (manufacturer of roller bearings and specialty alloy steel), expressed similar
views. She spoke for the Society for Human Resource Management (SHRM) and for
the Flexible Employment, Compensation and Scheduling Coalition (FLECS), the
latter “a group of businesses and organizations representing a wide variety of
industries which are here seeking to bring the FLSA into the 1990s.” She observed:
14
The Fair Labor Standards Act is a depression-era legislation created in the 1930s
to protect American workers from uncaring employers — but times have changed
and the Act has not. Ironically, many of the provisions of the Act now serve as ...
an obstruction rather than a protection of employee interests.
Comp time, she suggested, was an option obstructed by the FLSA. “My
experience has been,” Ms. Fairall observed, “that most people would prefer to
have the time off with pay rather than receiving the overtime check. For many
people, the time spent with family, or friends, or outside interests is more
important than the cash.”15
Others expressed similar views. Robert J. Niedzielski, Director of Human
Resources Development for Tighe Industries, Inc., of York, Pennsylvania, like Ms.
Fairall, spoke for SHRM. He argued that the FLSA had “become convoluted and
arcane as the work force and employee needs have changed.” “Too often,” he
concluded, “the Act now serves as an impediment rather than an instrument for
employee protection.” A statement submitted for the National Federation o
16
f
Independent Business (NFIB), echoing the report of the LPA (cited above), pointed
to the Depression-era origins of the Act and noted: “The Great Depression has long
since vanished and the widespread rates of high unemployment are an afterthought.”
Paraphrasing the LPA report, the NFIB statement argued that small businesses,
“struggling to survive in today’s volatile marketplace,” deserve relief from the
rigidities of overtime pay requirements as much as do state and local governmental
12 House Subcommittee on Workforce Protections, Hearings, 1995. p. 170-171.
13 House Subcommittee on Workforce Protections, Hearings, 1995. p. 178-181.
14 House Subcommittee on Workforce Protections, Hearings, 1995. p. 182 and 185. SHRM,
composed of “human resource, personnel, and industrial relations professionals and
executives,” was also a member of FLECS.
15 House Subcommittee on Workforce Protections, Hearings, 1995. p. 182.
16 House Subcommittee on Workforce Protections, Hearings, 1995. p. 199-201.

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employers. A statement by the National Society of Professional Engineers als
17
o
affirmed that the FLSA “impedes, rather than protects, the rights of American
workers.”18
Some Witnesses, Generally Skeptical of FLSA Amendment. Two witnesses at
the June hearing expressed concern about the alleged family friendliness of the
projected comp time/compressed workhours initiative. Edith Rasell, an economist
with the Economic Policy Institute, a Washington-based research and policy group,
19
argued that employers already have “incredible flexibility” (i.e., flexibility within a 40
hour workweek) and, in excess of 40 hours per week if they pay time-and-a-half. She
added that imposing long hours of work “is a hardship on employees,” a hardship that
the FLSA was intended to reduce. In her prepared statement, Ms. Rasell noted:
...if the overtime pay requirement is relaxed, variability in scheduling is likely to
become more common. At their employer’s discretion, some hourly workers may
gain greater flexibility in taking time off from work, but at the cost of losing the
regularity and predictability of their work schedules.
Ms. Rasell presented survey data which, she observed, indicated that putative worker
support for a comp time/compressed work hours option (in place of traditional
overtime pay) might be overstated.20
Michael Leibig, an attorney specializing in FLSA-related cases, argued tha
21
t
many of the complaints of inflexible workhours requirements have resulted from “a
lack of understanding of the provisions of the Act.” It may also result, he suggested,
from a desire of flexible hours advocates to circumvent the essential purposes of the
FLSA.
“Some of the witnesses,” Leibig noted, “have talked about problems of women
and families, and men and families, parents and families, and said that if they could use
compensatory time they could spend more time with their family...” But, he
17 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 236-238 and 30-35.
The National Federation of Independent Business, like the Labor Policy Association, is part
of the FLECS Coalition. The NFIB statement also urged modification of the FLSA to exempt
small businesses from payment of the federal minimum wage.
18 House Subcommittee on Workforce Protections, Hearings, 1995. p. 238-239.
19 The Economic Policy Institute (EPI) describes itself as a “nonprofit, nonpartisan think tank
that seeks to broaden the public debate about strategies to achieve a prosperous and fair
economy.” Again: “EPI is supported by grants from foundations, corporations, labor unions,
and individuals.” See the EPI home page (January 23, 1997) at [htt://epinet.org/#about]. EPI
has also been described as close to the trade union movement. See, for example, The Wall
Street Journal, March 12, 1993. p. A4.
20 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 201-207.
21 Leibig, with the Washington firm of Zwerdling, Paul, Leibig, Kahn, Thompson & Wolly,
teaches at the Georgetown University Law Center and “regularly litigate[s]” FLSA-related
cases. He has had an extensive involvement, as an attorney, with public employee groups and
as a lecturer on employment-related issues. See, ibid, p. 219-220..

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maintained, the “real problem” is that Americans “are working more than 40 hours a
week and, therefore, don’t have time to spend with their families. The goal of family-
oriented people ... should be to get the work week back under control so that people
have sufficient time.” In his opinion, “[w]eakening the requirement that the work
week stay short is not likely to cause more time off.”22 In his prepared text, he
affirmed: “A constant pressure for increasing hours of work is damaging and
disruptive — it ought to be, and is, against the law of the federal Fair Labor Standards
Act.”23
Leibig pointed out that the FLSA “has, since its inception, disallowed payment
in comp time in lieu of cash,” arguing that institution of a comp time option would
24
fundamentally undercut the Act.
A system which allows work to be paid for by the adjustment of hours obviously
undermines the forty hours of work standard of the Act. It allows the individual
employer to make an arrangement with an individual employee which results in
avoidance of the cash overtime rights of all other employees. Were comp time to
be allowed without very clear restrictions on it the forty hours of work standard
of the Act would become a dead letter.
When, in 1985, the comp time option was legislated for state and local government
employers, he recalled, “it was recognized that extension of the comp time rule to the
private sector would make enforcement of the hours of work standard next to
impossible.” (Italics added.)
25
Aside from matters of compliance, Leibig expressed concern about extending to
private sector employees the concept of deferred compensation, allowed in a comp
time format for state and local government employees.
The main reason that compensatory time can work in the public sector but
not in the private sector, however, is that every year thousands of private sector
companies go out of business, and if you allow compensatory time they will have
an additional liability for the compensatory time banks that are built up for their
employees. If you allow compensatory time, you are undermining the provisions
of the Fair Labor Standards Act in the private sector that require that pay be done
on a timely basis. You are basically allowing the postponement of pay, you are
not reducing the cost of employment at all, you are just allowing it to be
postponed, and in the private sector that raises particular problems.26
But, Leibig suggested, weakening of the FLSA might be the point of the comp
time/compressed scheduling campaign. He charged:
22 House Subcommittee on Workforce Protections, Hearings, 1995. p. 208-209.
23 House Subcommittee on Workforce Protections, Hearings, 1995. p. 213.
24 Comp time is allowed within a 40-hour workweek; but, this could be considered flexibility
rather than comp time within the meaning of the proposed legislation.
25 House Subcommittee on Workforce Protections, Hearings, 1995, p. 215.
26 House Subcommittee on Workforce Protections, Hearings, 1995. p. 209-210.

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The strategy is one which has selected key provisions of the FLSA, without
which general enforcement would be difficult, attacked each of those provisions
in isolation, attempted to establish the irrationality of the provision taken in
isolation, and, thereby, gain a series of amendments to the Act which taken
together would gut enforcement and effectively undermine the forty hour work
week.
Each of the provisions under challenge was originally placed in the FLSA
regulatory scheme in response to specific employer tactics by which the basic
overtime provisions of the Act might overwise be easily avoided.
Moving on, Leibig contended: “A number of American employers — the flexible
work coalition — are engaged in mounting argument favoring five reforms to the
FLSA to make the Act `more flexible’ and `more modern.’ In fact,” he concluded,
“those reforms reflect exactly the strategies which employers, seeking to avoid the
forty hour work week standard, have used since the 1930s ... These reforms would
so weaken the national hours of work standard as to make it unenforceable.”27
Questioning from the Subcommittee. Questioning of the witnesses was deferred
till all had testified. Since a number of FLSA-related issues were before the
Subcommittee, questioning moved in different directions.
Representative Ballenger addressed several questions to Ms. Rasell concerning
the quality of the polling data she had presented and which suggested that flexible
scheduling may not be a priority (or even, popular) issue for workers. But, the
dialogue turned away from polling techniques to choice and to control.
Ms. RASELL. ...the question I think would be, if there was an option
who would exercise the option? If I —
Chairman BALLENGER. I think you’d have to have an agreement
between the employer and employee.
Ms. RASELL. Exactly, exactly.
Chairman BALLENGER. I think that’s the way we intend to talk
about the law.
Ms. RASELL. But, if the employer wanted me to take compensatory
time instead of overtime pay, just because I wanted overtime pay I might
not get it. And so—
Chairman BALLENGER. But ... it’s got to be an agreement between
the employer and the employee, otherwise you are going to end up with a
plant that’s not going to work...
Ms. RASELL. Sure. I think the feeling was that the employers have
more power than the employees do, and the choice would be more likely
to be their’s than the employees.28
Representative Fawell, directing his comment to Mr. Leibig and speaking “as a
lawyer,” declared the Act “arcane.” Though “someone who may specialize in it, and
27 House Subcommittee on Workforce Protections, Hearings, 1995. p. 213-218.
28 House Subcommittee on Workforce Protections, Hearings, 1995, p. 222-223.

CRS-10
teach it, and live it” may find the FLSA “relatively simple,” he asserted that “the
average hardworking administrator and workers are really befuddled by it and
confused.” There is, he stated “an awful lot of confusion out there.” Representative
29
Miller of California interjected: “Not being familiar with the law should not be a
reason to repeal the law.”30
Representative Woolsey raised a number of technical issues that seemed to
suggest that the comp time option might not to entirely attractive to employers. In
her experience as a human resources professional, she stated, “it was way more costly
to have people take time off rather than pay them for their time and a half, because
they took an hour and a half for every hour they worked, and we needed that
productive work force.” She noted, the use of comp time “made scheduling very
difficult.”31
Advocates of flexibility had consistently urged the shift of policy in terms of
choice. But, choice for whom, Ms. Woolsey queried.
We have to look at the choices for the employees to make it work for them, and if
we give them those choices I’m going to question whether it will work for the
employer at all, because if we give the employee the choice of cash or banking
their time, and banking time and not knowing when they are going to use it ... you
have no control over your scheduling, who has the final say on when that
compensatory time can be taken?
Beyond choice per se, Representative Woolsey found that “the biggest challenge that
my employees had was notice of overtime. They didn’t mind working overtime, but
they needed [prior] notice of overtime.” She explained:
... the employer is going to have to be responsible for notifying so people can have
their child care ... if they are students they can know when they get to go to school,
so there’s a lot that’s going to fall on the employer’s shoulders that I don’t think
anybody that’s recommending this is even thinking about. It is not going to be
simple.
She acknowledged that the option “could work for the employees just fine, it could
work for the employer,” but she expected that it would be “complicated.”32
Here, Mr. Romero-Barcelo of Puerto Rico turned to Ms. Fairall of The Timken
Company and the FLECS Coalition. He reviewed the concept of banked hours (i.e.,
working up front and deferring leave and pay until later) and asked if the employer
would be expected to pay interest on these deferred earnings.
Ms. FAIRALL. I don’t know, I’ll have to defer that question to—
29 House Subcommittee on Workforce Protections, Hearings, 1995. P. 225-226.
30 House Subcommittee on Workforce Protections, Hearings, 1995. p. 226-230.
Representative Ballenger indicated that repeal of the law was not his intent.
31 House Subcommittee on Workforce Protections, Hearings, 1995. p. 231.
32 House Subcommittee on Workforce Protections, Hearings, 1995. p. 231-232.

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Mr. ROMERO-BARCELO. It hasn’t been considered, has it?
Ms. FAIRALL. [continuing] I don’t know, sir.
Mr. ROMERO-BARCELO. Because, if they don’t pay interest for
that half of an hour—
Mr. LEIBIG. In the public sector they don’t.
Mr. ROMERO-BARCELO. ... When they are talking about
compensatory time, they are not talking about paying interest to the
workers on the compensatory time, I haven’t heard about it.
So, immediately, the employer is already making some money out of
the compensatory time that it wasn’t making before.33
Still engaged with Ms. Fairall, Mr. Romero-Barcelo raised the issue of choice.
Was it her contention, he asked, that the employee would have the right to use
accrued comp time “when he wants it, or is it [that] the employer would have
something to say about when” the comp time is used.
Ms. FAIRALL. Sir, I think they would have to — it would be a
mutually agreeable scheduling. I mean, they couldn’t come up tomorrow
and say I want to take tomorrow off as my compensatory time, but on a
mutually agreeable time I think that there would be an agreeable time. The
employer and the employee together would agree.
Mr. ROMERO-BARCELO. When he gets paid the time and a half
does the employer have anything to say about when he should spend this
money?
Ms. FAIRALL. ... No, sir.
Mr. ROMERO-BARCELO. So, in other words, that’s another
limitation to the employee, where he has something that belongs to him but
he cannot dispose of it, somebody else has to agree with how he’s going to
dispose of it. So, he’s got another limitation. It’s like a mortgage on his
time.34
At that juncture, Mr. Romero-Barcelo returned to an issue raised in testimony
by Mr. Leibig.
Mr. ROMERO-BARCELO. ... supposing the employer closes shop
and liquidates, he says, oh, he’s lost money, or he’s just skimmed off the
profits but he just says he lost money, he even files for bankruptcy, that
happens very often, what happens then to that compensatory time? Who
pays for it?
Ms. FAIRALL. I’m going to have to refer to the Coalition counsel,
sir, I don’t know.
Chairman BALLENGER. Mr. Leibig, I’m sure, knows, Mr. Leibig,
35
let me ask you the question, is that part of, in the bankruptcy case, is that
one of the first claims on this or not?
33 House Subcommittee on Workforce Protections, Hearings, 1995. p. 232-233.
34 House Subcommittee on Workforce Protections, Hearings, 1995. p. 233.
35 Mr. Leibig, an attorney, was not associated with the Coalition.

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Mr. ROMERO-BARCELO. Oh, yes, it is, I can answer that, it is one
of the first.
Mr. LEIBIG. Salary is first.
Chairman BALLENGER. Well, I’m not sure, I was just going to ask.
But, Mr. Romero-Barcelo observed, “sometimes ... there’s not even money for wages
... very often that happens. So there’s another danger for the employees.”36
Harkening back to the opening observations of Representative Ballenger about
what workers want (i.e., flexibility) and to the polling data from Ms. Rasell, Mr.
Romero-Barcelo summed up: “... when you talk about many employees prefer[ring]
that option, they don’t always know all of the economic effects of what they are
saying or what they are accepting.” He continued:
... for the employee, it’s better to have that time and a half pay. He can be cajoled
and fooled into believing it’s better for him, but it’s not better for him. And, this
is something that we should realize, we are not doing a favor to the employees.37
The Ballenger Bill (H.R. 2391) as Introduced. On September 21, 1995,
Representative Ballenger introduced H.R. 2391, the “Compensatory Time for All
Workers Act of 1995.” Section 7 of the FLSA deals with overtime pay; Section 7(o),
with the application of overtime pay standards to employees of state and local
governments. H.R. 2391, as introduced, would have broadened Section 7(o) of the
FLSA to make its comp time option available, with some technical modification, to
the entire workforce.
H.R. 2391 would permit the substitution of compensatory time off “at a rate not
less than 1 1/2 hours for each hour of employment for which overtime compensation
normally required — i.e., time-and-a-half. Private sector employees could not accrue
more than 240 hours of compensatory time. Comp
38
time, under H.R. 2391, could
not be carried over from one 12-month period (not necessarily a calendar year) to
another; but rather, if unused, had to be cashed-out: paid for by the employer at a
time-and-a-half rate. Such cash payment must be made for unused compensatory
leave “no later than 31 days after the end of” the 12-month period.
H.R. 2391 required the employer to allow the employee to draw down
compensatory hours “within a reasonable period after making the request” to do so
“if the use of the compensatory time does not unduly disrupt the operations of the
employer.” The bill did not define “reasonable period” nor did it offer guidance for
defining “unduly disrupt.”
Under current DOL implementing regulations designed for state and local
government employment, “a reasonable period” rests largely upon “the customary
36 House Subcommittee on Workforce Protections, Hearings, 1995. p. 233-234.
37 House Subcommittee on Workplace Protections, Hearings, 1995. p. 234.
38 H.R. 2391 would continue the 1985 FLSA amendments’ cap on accumulation of comp time
for state and local government workers at 480 hours for persons employed in emergency
services and 240 for other public employees.

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work practices within the agency based on the facts and circumstances in each case.”39
The regulations note of “unduly disrupt” that “[m]ere inconvenience to the employer
is an insufficient basis for denial of a request for compensatory time off.” Such denial
“should reasonably and in good faith anticipate that it would impose an unreasonable
burden on the agency’s ability to provide services of acceptable quality and quantity
for the public during the time requested without the use of the employee’s services.”40
These regulations, however, relate to the particular circumstances and culture of
public sector employment.41
The Hearings Resume. During the fall of 1995, the hearings on FLSA overtime
issues resumed. A hearing on October 25 focused primarily on issues not addressed
in the Ballenger bill. On November 1, the Subcommittee returned to the issue of
comp time with a final hearing on H.R. 2391. This time, the Members were working
with specific legislation before them. Further, the Ashcroft bill had been introduced
in the Senate; and, although S. 1129 was quite different from H.R. 2391, the Senate
bill provided the Subcommittee with additional options.
In an opening statement for the record, Chairman Ballenger acknowledged:
“There are some who will say that changes to the law which give employees greater
flexibility are really an effort to take protections away from employees.” But, he
stated, employees want flexibility. “I believe that we should allow employers and
employees to work out these types of issues themselves — recognizing that there
must be protections in the law against coercion.”42
The lead witness at the November hearings was Pete Peterson, Senior Vice
President for Personnel with the Hewlett-Packard Company, speaking for the FLECS
Coalition. He described the Coalition as “an industry group that strongly supports
H.R. 2391 as a valuable first step in reshaping [the] FLSA to fit today’s workplace
needs.”43
The Ballenger bill, Peterson began, “would permit employers to offer employees
the option” of comp time. He noted: “The significant point is that no employer
would be required to offer compensatory time and, likewise, no employee would be
required to take it.” Peterson, a member of the Board of Directors of the Labo
44
r
39 29 C.F.R. 553.25(c)(1). “Such practices include, but are not limited to (a) the normal
schedule of work, (b) anticipated peak workloads based on past experience, (c) emergency
requirements for staff and services, and (d) the availability of qualified substitute staff.”
40 29 C.F.R. 553.25(d).
41 While questioning Leibig, Mr. Ballenger referred to the 6 million corporations in America,
noting the difficulties that might result were each to go to DOL for guidance with respect to
the FLSA. House Subcommittee on Workforce Protections, Hearings, 1995. p. 221.
42 House Subcommittee on Workforce Protections, Hearings, 1995. p. 404.
43 House Subcommittee on Workforce Protections, Hearings, 1995. p. 406.
44 House Subcommittee on Workforce Protections, Hearings, 1995. p. 406. H.R. 2391, as
introduced, would have established two categories of employees: organized workers (those
(continued...)

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Policy Association, expressed enthusiastic support for compressed scheduling (part
of the Ashcroft bill but not of H.R. 2391), affirming: “This kind of flexibility would
help employees juggle their job, child care, and other responsibilities, along with
community and leisure activities.” He cited a poll conducted for the Employment
Policy Foundation which found that “three quarters of the respondents said they
would favor a proposal that allows hourly employees to choose to take their time-
and-a-half overtime compensation in the form of paid time off.” In closing, h
45
e
reiterated the FLECS/Labor Policy Association position: “The provisions [of the
FLSA] made sense probably when the Act was passed originally in 1938, but it is time
to take a look again at how the FLSA can help the needs in the nineties and
beyond.”46
Representative Owens raised the issue of choice: whether the comp time option
would truly be voluntary for the employee. Many employees feel, he noted, that
choice would rest with the employer and not with the worker.
It is really the employer because no employee is going to do anything which
displeases his employer. If the message is communicated from the employer, I
really want you to take compensatory time and not opt to take overtime pay, that’s
the way employees are going to proceed.
Turning to Peterson of Hewlett-Packard, Mr. Owens asked: “What measures do you
feel we can take to ensure that employee’s choice of compensatory time is truly
voluntary?” Would employers “be willing to give a written statement to the employee
that it is your choice, and I will accept either choice that you make?” Peterson
responded, calling the option a “win/win” situation. He added:
... I think that it would have to be clear that it is a voluntary program on both
sides. It’s voluntary on the part of the employer to offer it.
In some cases, offering of compensatory time is just not going to be able to
fit with the needs of the business. So I think it needs to be voluntary in that regard.
It also needs to be very clear that it’s voluntary on the part of employees as to
whether or not they take the overtime in pay or compensatory time.
So whether or not there is a requirement that employers put something in
writing of that nature, I’m not sure it’s required.
(...continued)
44
working under a collective bargaining agreement) and the unorganized or non-union
workforce. For organized workers, implementation of comp time would be a matter of
negotiation between their union and the employer. Unorganized workers would be allowed
to bargain individually with their employers.
45 The Employment Policy Foundation is identified as the “[e]ducational arm of the Labor
Policy Association and Equal Employment Advisory Council.” See: Fischer, Carolyn A., and
Carol A. Schwartz, eds. Encyclopedia of Associations: 1996. Detroit, Gale Research Inc.,
1995. p. 1473.
46 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 406-408.

CRS-15
While he was willing to consider the possibility of a written agreement, Peterson saw
no more reason to have a written statement from the company concerning comp time
than with respect to any other provisions of the FLSA.47
Mr. Owens then turned to the issue of control. Will workers, he asked, “be able
to take compensatory time off at a time when it’s to their advantage, it meets their
family needs, et cetera? Or will they also have to take it off at the convenience of the
company...?” He characterized the problem that he saw workers facing as: “...the
employer has the upper hand in terms of demanding that workers do it in a way which
is more profitable for the company, ... they can’t, despite the seeming voluntary
situation, have an equal role in the decision-making.” Peterson thought “that type of
thing is something that could be worked out;” he also expressed concern about
business realities: “...we do have to make sure that a business[’s] needs here are
brought into the picture.” In response to Representative Woolsey, Peterso
48
n
affirmed: “... it can’t be just the employee saying, I want to take it [comp time] right
now, no matter what.... There are some business need situations that would make that
difficult.”49
Attorney Leibig, returning as the closing witness on the comp time issue, noted
that DOL regulations governing comp time for the public sector had been “more
confused than first might appear” and had led to litigation. After explaining some of
the problem areas, he urged that if the comp time option were to be made available
to the private sector, “it should be done carefully and more carefully than it was done
in the public sector.”
Leibig suggested a number of possible changes in H.R. 2391 as introduced. He
urged that “it should be clear that compensatory time not be able to be required as a
condition of employment.” He explained:
One of the things that some employers in the public sector have done is said
[sic.] an agreement can be implied, you agree to work with me, I offer
compensatory time, therefore I have an agreement with you. And that has
happened regularly in the public sector, there has been a great deal of litigation
about it.
He pointed to potential confusion with respect to the bill’s provision allowing
the comp time issue to be dealt with either under a collective bargaining agreement
or, in the absence of such an agreement, by direct agreement between management
and workers. He noted a technical distinction between having a collective bargaining
agreement in place or merely having a representative, pointing out that “if you have
a certified representative under collective bargaining, you can’t have a direct
agreement with employees.” He suggested that the matter was ambiguous and
needed clarifying language.
47 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 445-446.
48 House Subcommittee on Workplace Protections, Hearings, 1995. p. 446.
49 House Subcommittee on Workforce Protections, Hearings, 1995. p. 451.

CRS-16
The legislation, as introduced, provided for cashing out of a worker’s comp time
bank (banked hours) “upon termination of employment.” Leibig noted that, in the
courts, “termination” has often been equated with being discharged, but that the term
would not necessarily cover retirement or voluntary separation. He urged that the
term “cessation” be substituted.
There may arise questions as to when comp time may (or must) be used and at
whose discretion. The provision allowing use of comp time where it “does not unduly
disrupt the operations of the employer” is fine, he suggested, as far as it goes. But
that leaves other questions. If an employee has accumulated a substantial amount of
comp time, can the employer insist that it be used and, if so, at a time designated by
the employer? If the employee is consciously building up comp time for a particular
purpose (e.g., hunting season), he may not have the right to utilize that comp time if
the employer finds it inconvenient or disruptive — or if the employer mandates a prior
use of hours during a slack period. Leibig noted a major difference between comp
time and money:
... if you got money, you take it and put it in your pocket or put it in the bank and
spend it. If you have compensatory time, you have a record in the employers’
[sic.] books, it is important that the employer can’t force you to spend that
compensatory time by making you take one hour off or two hours off.
He suggested language assuring that where “the employee has compensatory time,
[he] shall not be required by the employer to use up his compensatory time absent his
agreement.” He thought the putative desire of employees for comp time might
diminish if they were made to understand that it would be used at the employer’s
discretion and not their’s.
Leibig turned to the issue of banked hours and bankruptcy. “In the private
sector, bankruptcy is a regular thing. Every year thousands of companies go out of
business. It is important,” he suggested, “that the legislation make clear that this
banked compensatory time is a debt owed by the employer to the employee that has
the same preference in bankruptcy that wages would have had.”50
He voiced other concerns. “The Committee,” he thought, “should be mindful
of the tax loss of the change made and of the potential for tax avoidance.” Some
51
employers might be deceived by the fiscal implications of comp time use.
... compensatory time banks will show on the employers’ balance sheet if they have
it accounted as a liability. So at the end of the period on the employers’ balance
sheet, it will show a liability in the cash equivalent of this compensatory time.
Many public employers didn’t realize that and even in three cases had their bond
ratings jeopardized by the large level of liability.52
50 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 455-459.
51 House Subcommittee on Workforce Protections, Hearings, 1995. p. 463.
52 House Subcommittee on Workforce Protections, Hearings, 1995. p. 459.

CRS-17
He concluded on a cautionary note. The “main purpose for overtime pay, time and
a half,” he stated, “is to discourage employers from working people over 40 hours a
week at all.” Overtime is the primary mechanism through which the national “hours
of work” standard is enforced. “... when you weaken the 40-hour workweek, you
have to be very careful about how you do it or it will be eroded altogether...”53
An Overview of the 1995 House Hearings. Both witnesses and Subcommittee
members seemed to concur that oversight of the FLSA was needed. Whether the
statute was “crying out to be fixed” as the Labor Policy Association affirmed,54 or
needed more minor adjustment “undertaken only with the greatest care and on the
basis of careful attention” as urged by attorney Leibig, might be debated.
55
The Subcommittee hearings of spring and fall, 1995, on comp time and related
FLSA issues were technical. Many of the issues under Subcommittee revie
56
w
involved interpretation of the FLSA by DOL or had been raised in response to
regulations and “opinion letters” issued by the Department. Late in the hearings, Mr.
Owens referred to “a request that the Department have representatives testify, or the
Secretary himself, because I think it’s important that we start these hearings with an
understanding of where the policies are at this particular point.” At several points,
57
witnesses disputed among themselves as to what the Act required and what was
permitted under it. Yet, no one appeared to speak for DOL or to explain the
Department’s policies.
Extension of the comp time option to the private sector was being urged as pro-
worker and family friendly. When opening the first hearing in March, Chairman
Ballenger observed that “[e]mployees are looking for ways to juggle work, family and
personal needs.” As the final hearing c
58
ommenced, he reaffirmed: “...changes to the
law are necessary in order to give employees the kind of flexibility that they want.”59
Industry spokespersons similarly alluded to the plight of employees “working full time
schedules ... [while] juggling work with the responsibility of caring for children or
older parents.” The LPA argued: “Allowing them the choice of taking overtime pay
53 House Subcommittee on Workforce Protections, Hearings, 1995. pp. 462 and 473.
54 House Subcommittee on Workforce Protections, Hearings, 1995. p. 30.
55 House Subcommittee on Workforce Protections, Hearings, 1995. p. 462.
56 While comp time for the private sector was one of the issues before the Subcommittee, there
were others as well: revision of the “portal-to-portal” pay act [H.R. 1227 (Fawell); H.R.
1273 (Andrews)]; overtime pay for firefighters and rescue squad workers [H.R. 94
(Bateman)]; overtime pay treatment of inside sales personnel [H.R. 1226 (Fawell)];
uncompensated use of “volunteers” [H.R. 1589 (Knollenberg)]; minimum wage and overtime
pay treatment of certain “houseparents” employed in facilities for troubled children [H.R.
2531 (Hutchinson)]; and consideration of gainsharing, incentive bonuses, etc., in the
calculation of the “regular rate” for overtime pay purposes [H.R. 3087 (Ballenger)].
57 House Subcommittee on Workforce Protections, Hearings, 1995. p. 445.
58 House Subcommittee on Workforce Protections, Hearings, 1995. p. 2.
59 House Subcommittee on Workforce Protections, Hearings, 1995. p. 404.

CRS-18
or compensatory time off can help employees ease those burdens.”60 Peterson of
Hewlett-Packard declared that employees “increasingly value work time flexibility”
and that they “want more creative ways to handle their various responsibilities.”
61
Through the course of the hearings, spokespersons for workers were few. While
several individuals spoke in their own behalf (and would later be quoted extensively
in the majority’s report on the legislation), no one appears to have spoken for the
trade union movement nor, for that matter, for other bodies of workers.
62
63
Representatives of women’s groups — the legislation was presented as pro-woman
— did not testify at this point. Though frequent comment was made about worker
64
demand for increased flexibility, the primary statistical measure of such demand
utilized in the context of the hearings appears to have been a poll conducted for the
Employment Policy Foundation by Penn and Schoen Associates. The Foundation is
sometimes identified as the educational arm of the Labor Policy Association.65
60 House Subcommittee on Workforce Protections, Hearings, 1995. p. 43.
61 House Subcommittee on Workforce Protections, Hearings, 1995. p. 406-407.
62 The trade union press was decidedly hostile to the comp time initiative. See, for example:
“40-Hour Week on GOP’s Hit List,” The Dispatcher, February 10, 1995. p. 4; Lee, Marion
A. “Our Most Sacred Labor Laws Are Under Attack,” UA Journal, March 1995. pp. 4-5;
“Is the 40-Hour Workweek a Thing of the Past?” (Focusing on S. 1129), The Laborer,
May/June 1996. p. 7; Lee, “Threat to 40-Hour Work Week Is a Threat to Labor’s Legacy,”
UA Journal, June 1995. pp. 4-5; “Capitol Digest,” AFL-CIO News, August 5, 1996. p. 3;
and “Comp Time Instead of OT? Bad deal for workers,” The Guild Reporter, December 13,
1996. p. 7; “Proposals in Washington Threaten Worker Rights, Income,” IUE News,
January-February 1997. p. 4; “Family Comes First (Stop the Attack on Overtime Pay),” The
Teamster, March-April 1997. pp. 12-13; and, “Designed To Deceive: Bills Now Before
Congress Are Wolves in Sheep’s Clothing,” UA Journal, April 1997. pp. 2-3. Further trade
union perspectives on the comp time issue are presented by George Becker, President United
Steelworkers of America, and by Jay Mazur, President, Union of Needletrades, Industrial and
Textile Employees, in separate letters to The Wall Street Journal, March 31, 1997. p. A22.
Each is critical of the proposal. See also Peggy Taylor, Director, Department of Legislation,
AFL-CIO, to Representative William F. Goodling, Chairman, Committee on Economic and
Education Opportunities, June 25, 1996. Ms. Taylor protests, in addition to a general critique
of H.R. 2391, that the bill “will not give workers increased control over their working lives.”
63 Attorney Leibig has worked with various trade unions and has public employee unions as
clients, but he was not a witness for organized labor. Ms. Sandie Moneypenny, “a Process
Technician in the assembly area at The Timken Company” presented an endorsement of the
comp time option immediately following that of Timken’s Senior Human Resource
Representative, Kathleen M. Fairall. Several other workers spoke as individuals, and The
American Network of Community Options and Resources (ANCOR) presented for the record
several handwritten letters from its employees.
64 A circular from the Women’s Legal Defense Fund, “The Ballenger ‘Comp Time’ Bill: Will
It really Help Working Families?” (Undated), declared H.R. 2391 to be “a sham” and argued
that “under this legislation, an employer can require an employee to work 50, 60, or more
hours a week when the workload is heavy, and then pressure her to use ‘comp time’ when the
workload eases.”
65 House Subcommittee on Workforce Protection, Hearings, 1995. P. 409; and Fischer,
(continued...)

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A wide range of issues, many of them technical, were raised during the hearings
and many of them pointed toward refinements that might be considered with respect
to the proposed legislation. As he drew the final session to a close, Representative
Ballenger observed to attorney Leibig: “I would like to say that some of your
suggestions are right interesting to me. We would love to look into them before we
go further.”66
H.R. 2391 Reported from Committee, July 1996. On July 11, 1996, H.R.
2391 was reported by the Committee on Economic and Educational Opportunities by
a vote of 20 yeas to 16 nays. The vote split along party lines: Republicans supporting
the bill; Democrats, in opposition.
Modifications in the Bill as Reported. As reported, H.R. 2391 seems to have
reflected much of the caution and concern for protection of worker interests
suggested by the hearings. It contained expanded language dealing with participation
of non-union workers (those without a collective bargaining agreement) in the comp
time program, provided that such workers must enter the program “knowingly and
voluntarily,” and mandated that the comp time agreement between employers and
workers must be “a written or otherwise verifiable statement” that can be preserved.
Entering into the agreement may not be “a condition of employment.” Language was
also added to require that an employer, neither “directly or indirectly” “intimidate,
threaten, or coerce” an employee into participation in the comp time program nor
with respect to the utilization of banked hours.
New cash-out provisions were added, allowing an employer or an employee to
convert the banked hours to cash: in the case of the employer, at any time; in that of
the employee, within 30 days after a written request. A cash-out of remaining banked
hours was required upon a worker’s “voluntary or involuntary termination of
employment.” A penalty structure was added.
No special definition of the concepts “threaten,” “coerce,” or “intimidate” was
provided in either version of the legislation. Nor were the concepts of “reasonable
period” (for being able to draw down banked comp time hours) or “unduly disrupt the
operations of the employer” elaborated upon.
Comments from the Majority. Noting the experience of state and local
governments with comp time, the Committee’s report affirmed that the arrangement
authorized in H.R. 2391 “can provide ‘mutually satisfactory solutions’ in the private
(...continued)
65
Carolyn A., and Carol A. Schwartz, eds., Encyclopedia of Associations, 1996. Detroit, Gale
Research Inc., 1995. p. 1473. The other source of statistical data that appears in the comp
time hearings, was presented by Edith Rasell of the Economic Policy Institute (a body
sometimes regarded as having a union/worker perspective); but Rasell’s data, developed by
Lake Research, presented a somewhat different perspective — and one in conflict with the
Employment Policy Foundation’s poll. See Hearings, ibid, p. 201-207.
66 House Subcommittee on Workforce Protections, Hearings, 1995. p. 474.

CRS-20
sector no less than is the case in the public sector.” It quoted the
67
testimony from
three working women at the 1995 hearings, asserting that there is “ample support for
concluding that ... [they] are not alone in wanting the option of being able to earn
compensatory time off, rather than cash wages.”68
The report stated that H.R. 2391 “would not change the employer’s obligation
to pay overtime” at time-and-a-half where an employee worked more than 40 hours
during a 7-day period. The legislation was permissive: it would allow the comp time
alternative “only if the employee and employer agree on that form of overtime
compensation.” It affirmed that the Committee “does not intend,” through the
reported legislation, “to alter current public sector [state and local governmental] use
of compensatory time in any way.” Rather, it would “extend the option” to the
private sector.69
Included in the legislation were “a number of provisions for employees in the
private sector which are not provided in current law for public sector employees.”
These, the report stated, “have been added in response to concerns which have been
raised about the possible misuse of” the comp time option. It explained the form of
70
the agreement,71 noting that it should be “written or otherwise verifiable” and
affirmed: “The Committee does not intend that an agreement to take compensatory
time could be purely oral with no contemporaneous record kept.” And it voiced “the
Committee’s intent that the employee be able to withdraw from such an agreement
at any time.”72
The report emphasized “voluntary choice” for the employee and prohibition
against intimidation, threats and coercion. It noted that “a new remedy” had been
created where employers “willfully violate” the bill’s the anti-coercion language.
... if the employer fails to pay overtime (either in cash wage or compensatory
time), he or she would be liable under Section 16(b) of the FLSA. Similarly, any
repeated or willful violations of the “anti-coercion” provision would subject the
67 U.S. Congress. Committee on Economic and Educational Opportunities. Working
Families Flexibility Act of 1996. Report to Accompany H.R. 2391. House Report No. 104-
670, 104th Cong., 2 Sess. Washington, U.S. Govt. Print. Off., 1996. pp. 4-5. (Hereafter
nd
cited as House Report No. 96-670).
68 Quoted were: Ms. Arlyce Robinson, Administrative Support Coordinator, Computer
Services Corporation; Ms. Sandie Moneypenny, a process technician, The Timken Company;
and Ms. Deborah McKay, Administrative Specialist, PRC, Inc. To support its contention,
the report cited the 1995 poll conducted by Penn & Schoen Associated, Inc., conducted for
the Employment Policy Foundation. House Report No. 104-670. pp. 3-7.
69 House Report No. 104-670. p. 7.
70 House Report No. 104-670. p. 7.
71 The report explains: “The agreement may be specific as to each hour of overtime, or it may
be a blanket agreement covering overtime worked within a set period of time.” This would
suggest some flexibility in program design and in the agreement, itself. House Report No.
104-670. p. 8.
72 House Report No. 104-670. p. 8-9.

CRS-21
employer to liability for civil penalties under section 16(e). In addition, if a cause
of action is brought by an employee, the employer may be required to pay the
employee’s attorney’s fees and costs.
It added that the legislation “does not require employers to offer their employees the
option of taking overtime pay in the form of compensatory time, but it allows
employers to do so.” But, “[w]here employers choose to offer compensatory time,
the bill provides that the decision is then left to the employee” whether or not to
request to participate in that option.73
An employee with accrued comp time “may generally use the time whenever he
or she so desires.” He “must request to use compensatory time a reasonable time in
advance of using it” and its use should not “`unduly disrupt’ the operations of the
employer.” Through public sector experience, the unduly disrupt standard has
become narrowly defined “and does not allow the employer to control the employee’s
use of compensatory time.” The report stated:
The Committee believes that the law must be written to allow the employer some
ability to maintain the operations of the business. If that is not recognized in the
law, then no employer will ever offer compensatory time ... Furthermore, providing
a right to an employee to use compensatory time without any regard to workload
or business demands, is simply unfair to co-workers, who in many cases would
have to handle the workload of the absent employee.74
Accrual of comp time by private sector employees would be limited to 240
hours. “Employees and employers may ... agree to limit accrual of compensatory time
to less than 240 hours per year.” Accrued comp time “would be treated as unpaid
employee wages in the event of the employer’s bankruptcy” and “would be a priority
claim on the employer’s assets.”75
Comments from the Minority. “The bill, as reported, grants rights to
employers, not to employees,” the minority report stated. “This legislation
encourages employers to hire fewer employees and to work them longer hours by
freeing ... [employers] from having to pay cash for overtime, potentially reducing both
workers’ incomes and employer labor costs...”7 The Minority observed that this was
6
contrary to the spirit and purpose of the FLSA, adopted “to prevent employers from
competing on a basis of undermining living standards, a destructive race to the bottom
that impoverishes workers and harms the overall economy.”77
The minority noted an essential premise underlying the FLSA: “that is, a worker
cannot agree to give up his or her right to the minimum wage or overtime pay.” It
explained:
73 House Report No. 104-670. p. 9-10.
74 House Report No. 104-670. pp. 10-11.
75 House Report No. 104-670. pp. 11-12.
76 House Report No. 104-670. p. 27.
77 House Report No. 104-670. p. 25.

CRS-22
This fundamental principle of the Act is grounded in the reality that individuals
will virtually always feel compelled to accede to their employer’s demands because
of the inherently greater and more pressing need for the worker for an income ...
than the employer’s need for the services of an individual worker.
This economic pressure, the immediate interests of individual workers aside, the
report argued, was inherent in the private sector work environment.
The waiver of statutory rights by even a few workers places all workers at risk.
It will usually be in the “economic self-interest” of some employees to compromise
their statutory rights, whether in the hope of greater rewards tomorrow or merely
to hold onto as much as possible today. But even if only a few workers in a
workplace “voluntary” waive their rights, the rest of the employees will come
under severe pressure to follow suit in order to keep their jobs. Moreover,
allowing individuals to waive their right to a living wage or overtime pay erodes
the broad social purpose of spreading available work among all workers.
The Minority affirmed: “The original principles which underlie the FLSA are as
relevant today as they were in 1938.”78
DOL’s wage/hour investigative staff “has declined by 15% since 1990” and “[n]o
one realistically forecasts a change in that trend.” This shortage of staff, the report
suggested, makes labor standards enforcement precarious.
Against these present-day realities, the Republican-led Congress is pushing
legislation that fundamentally changes the overtime law. The Republican Majority
proposes to do so in a manner that significantly weakens workers’ understanding
of their rights, encourages further violations of the overtime law, and weakens the
ability of workers to enforce their rights when the law is violated.
Even with verifiable agreements and penalties for violators, it said, workhours
flexibility could exacerbate compliance problems. “Given the remaining deficiencies
in the bill,” the report states, “this ‘protection’ is meaningless.”79
The Minority pointed to “real and substantial differences” between employment
in the public and private sectors. “Employers in the private sector have a direct self-
interest in reducing labor costs at the expense of workers that does not typically exist
in the public sector.” Worker protections, generally, are more extensive in the public
than in the private sector: “more than 40% of the public sector work force is
organized” while less than 15% of the private sector workforce belongs to a union.
Further, “even where public sector workers are not organized, they are typically
protected by civil service laws.” In the public sector, employees are normally
disciplined or terminated on a “just cause” basis; in the private sector, in the absence
of a union, employees may be terminated by the employer on an “at will” basis — e.g.,
at the will of the employer, with or without cause. Finally, the report notes, “public
employers rarely go out of business, and if they do, are unlikely to be judgment-proof.
78 House Report No. 104-670. pp. 25-26.
79 House Report No. 104-670. pp. 25-27.

CRS-23
Private employers regularly go out of business and are often judgment-proof when
they so do.”80
Under H.R. 2391, those who willfully violate the law by engaging in
intimidation, threats or coercion of workers are subject to penalties; but, the report
explains: “...to be entitled to any remedy an employee must produce a smoking gun
that proves that the employer engaged in coercive activity for the express purpose of
interfering with the employee’s rights. It is a burden most employees are unlikely to
be able to meet...”81
Employee rights, the report contends, may be few. Whether to offer comp time
is an employer decision. Thus, the flexibility option is not entrusted to workers. Nor
is the design of the option, itself, entrusted to workers.
No employee “has a legal right to work overtime.” That option (which some
workers may value because it adds to their income) is left to the employer. “The bill
does not prohibit employers from assigning overtime on the basis of whether the
employee has chosen compensatory time in lieu of overtime pay.” Thus, an employer
might reward cooperative employees (those accepting comp time) through assignment
of extra work — without being guilty of threats, intimidation or coercion. An
employer may offer a comp time option on a selective basis; there is no requirement
that all employees be permitted to enjoy flexibility. “...the employer may arbitrarily
deny compensatory time to an employee on some occasions, while offering it to the
employee on others.” The Minority concluded: “Rather than increasing a
82
n
employee’s control over his or her own life, H.R. 2391 actually increases the
employer’s control over the worker’s life.”83
The Minority argued that even a worker with banked hours of comp time has no
secure right to use that time under H.R. 2391. The employer “can simply deny the
leave on the basis that it will unduly disrupt the employer’s business.” Or, the
employer “can unilaterally buy back the compensatory time from the employee,
thereby wiping out the employee’s compensatory time bank.” An employee
84
,
requesting the use of comp time, may use it “within a reasonable period after making
the request” but the employer decides what constitutes “a reasonable period.”85
The FLSA has no requirement for employer-provided sick leave or vacation
time. If workers can routinely accrue up to six weeks of comp time, “[t]he question
then becomes, why should an employer give away paid leave when that employer can
80 House Report No. 104-670. pp. 27-28.
81 House Report No. 104-670. p. 28.
82 House Report No. 104-670. p. 29.
83 House Report No. 104-670. p. 29.
84 House Report No. 104-670. p. 29. Under the proposed legislation, the employer had the
right to buy back (cash-out) an employee’s banked comp time; conversely, an employee could
convert his comp time to cash at will.
85 House Report No. 104-670. pp. 29-30.

CRS-24
require employees to work overtime to order to earn paid leave instead?” The report
queries: “...how voluntary is compensatory time if the only way employees can earn
paid leave is to take their overtime compensation in the form of compensatory time
instead of being paid for overtime?”86
The minority report argues that institution of comp time would create substantial
enforcement/compliance problems, especially in industries where such problems
already persist: i.e., low-wage industries. There would be no obligation for an
employer, under H.R. 2391, it states, to post an explanation of the option, its terms,
or alternatives thereto.
H.R. 2391 Called Up in the House, July 1996. On July 26, the House
prepared for consideration first of the rule and then of H.R. 2391 per se. As the
session commenced, prior to calling up either, a series of one-minute speeches
anticipated the opposition that would later be voiced against H.R. 2391.
Representative Green (of Texas) observed: “We have a bill today on the calendar that
will change 60 years of 40-hour week laws.” Repr
87
esentative Bonior opined: “...this
comp time bill is not about compensation, and it is not about flexibility, and it
certainly is not about helping working families. It is about ending the 40-hour
workweek.” Mr. Bonior added, “It is about changing the laws so employers no
longer have to pay overtime wages for overtime work.”88
In opposition to the bill, Representative Schroeder stated that “America’s
working families are under tremendous stress.” And so, she argued, the sponsors of
the comp time legislation “have come up with this new warm fuzzy. It sounds
wonderful.” But, she added: “This is not what we need.” An advocate of flexible
and compressed work scheduling for federal employees during the 1970s and 1980s,
Ms. Schroeder argued that the issue was different and that the legislation was
misnamed. “It is wrong to try and trick America’s families, who are under such
stress, that you are trying to be so sympathetic toward them, when all you are really
doing is giving their employers even more money and even more authority over the
time and the hours that they work.” Ms. Schroeder concluded: “This is wrong. It
should be defeated.”89
Consideration of the Rule. Debate commenced with Representative Greene of
Utah. “As part of the House’s new crop of working mothers, I am proud to be a
cosponsor of this legislation,” she said. It is “commonsense legislation to give
working families a much-needed option in balancing their work and family schedules.”
In 1938, “most women worked at home. Today, most women work both in their
homes and outside of the home, and struggle to balance the time demands of work
and family — particularly those of children.” She termed the FLSA overtime
86 House Report No. 104-670. p. 32.
87 Congressional Record, June 26, 1996. p. H8561.
88 Congressional Record, July 26, 1996. p. H8562.
89 Congressional Record, July 26, 1996. p. H8561. There were no counterpart speeches in
behalf of H.R. 2391 just then, but extensive pro-comp time comments followed during
consideration of the rule and of the legislation.

CRS-25
provisions (the 40-hour week) “anachronistic” as “hampering America’s new
generation of working families.”90
The argument in favor of comp time legislation stressed that it would be family-
oriented, would expand worker choice and flexibility, and meet the needs of working
women. Ms. Greene affirmed:
Things have changed since 1938 — we have more working parents, more single
parents, more divorces. ... We also have more seniors living longer, needing the
care and love of their children and grandchildren. ... [H.R. 2391] will permit
working parents to bank comp time, so that they can have time available to tend
to a sick child, to go to a special event for that child, like a baseball game or dance
recital, or to care for a fragile parent. If some of those workers prefer extra cash
wages for overtime, they can still choose that.
Focusing upon choice, Ms. Greene concluded: “...this is a chance to help working
families get a little more control over their lives by giving them greater choices and
more flexibility. Let’s let them choose.” And, she noted: “The point is that, under
this legislation, the choice will be theirs, not Washington’s.”91
Representative Moakley dissented, saying that the legislation “basically means
that employees can be forced to take paid time off rather than overtime pay.” It
allows the employer to stop paying overtime and to say to employees: “‘Sorry, I
can’t pay you overtime, but in return for your long hours, you can take a vacation
when it’s convenient for me, if I’m still in business.’” He stated: the legislation “not
only enables the employers to decide whether or not to offer comp time but also
provides no protections for when and how a worker can use their comp time...” His
office, he noted, had “not been deluged with letters and calls or telegrams from
employees clamoring for comp time.”92
The heated debate exposed deeply held, and diametrically opposed, views of this
legislation. Critics, Chairman Goodling charged, “totally distort the facts.”93
Representative Ballenger referred to “balderdash sprinkled with horse feathers” and
to “[d]istortions, prevarications, and untruths.”
94 Representative Schroeder agreed
that there had been distortion — but, from the other side. She urged Congress to
“strip off the name ‘family friendly’” — that the legislation be renamed the “‘employer
reward’ bill.” Representative DeLauro concur
95
red that the bill would “repeal the 40-
hour workweek” and was “a reward to the rich special interests.”
96
90 Congressional Record, July 26, 1996. p. H8563
91 Congressional Record, July 26, 1996. p. H8563.
92 Congressional Record, July 26, 1996. p. H8563.
93 Congressional Record, July 26, 1996. p. H8564.
94 Congressional Record, July 26, 1996. p. H8565.
95 Congressional Record, July 26, 1996. p. H8565.
96 Congressional Record, July 26, 1996. p. H8567.

CRS-26
Much of the debate focused upon employee safeguards. Arguments, pro and
con, seemed to reflect each speaker’s vision of workers, of employers, and of their
interrelationship within the competitive free market system.
Representative Meyers denied “that all employers are bad people who are
looking for ways to cheat their employees,” affirming that “most employers have a
deep and genuine concern about the people who work for them, and they want to do
everything they can to satisfy their employees’ needs.” Conversely, Representative
97
Wynn observed: “The reality of the workplace is that most employees want to keep
their jobs and therefore go along with the employer. That means,” he added, “that
when the employer suggests comp time, they are going to take it.”98
Mr. Ballenger contended that the workers protections of the bill were adequate.
“They [the workers] can go to court on their own or they could go to the Secretary
of Labor [Mr. Reich], who is not a friend of business, and he will do it for them to
enforce that law.” Representative Hefner, on the other
99
hand, questioned “how many
people would have on their own the resources to go to court and how many people
of their own would know where to go.” Mr. Hefner suggested “that 90 percent of the
people in our district in North Carolina do not have any idea who Mr. Reich is.”100
Mr. Wynn concurred. “I do not want to hear that oh, well, they can go to court and
we lowered the legal standard. The fact of the matter is minimum wage workers are
not going into anybody’s court. They are not going down the street to see Robert
Reich to talk about a labor violation. Those remedies,” he concluded, “are not
practicable.” Representative Meek seemed similarly dubious: “Many employer
101
s
will find a way to force employees to accept compensatory time instead of cash
because they know the employees don’t have the resources to fight this coercion.”102
Ms. Greene of Utah pursued the issue of worker choice. The bill, she argued,
“gives workers the flexibility that they need to be able to balance those competing
considerations of work and family.” It gives workers “more control over their lives...
to be able to choose for themselves, in the circumstances for each of their families...”
Ms. Greene urged: “Let us give workers that choice ... Let us respect their ability to
choose for themselves what is best and not dictate it from Washington as we have for
the past 60 years.”103
Again, there was dissent. Mr. Owens charged that “the bill is flawed at its
center.” Central to the legislation, he argued, was the assumption of “mutual
consent” between the parties: “in a relationship where all the power is on one side
97 Congressional Record, July 26, 1996. p. H8567.
98 Congressional Record, July 26, 1996. pp. H8569-H8570.
99 Congressional Record, July 26, 1996. p. H8565.
100 Congressional Record, July 26, 1996. p. H8565.
101 Congressional Record, July 26, 1996. p. H8569.
102 Congressional Record, July 26, 1996. p. H8572.
103 Congressional Record, July 26, 1996. p. H8571.

CRS-27
and the other person is powerless,” mutual consent was not possible.104
Representative Collins of Illinois concurred: the concept of a “truly voluntary
agreement” was a “hoax.” The bill “clearly attempts to gut the protection of the Fair
Labor Standards Act and undermines living standards to the detriment of workers.”105
Unlike traditional overtime pay, stated Representative McKinney, “workers can only
use their comp time when it is convenient for their employers, not their families. So
much for family friendly legislation.”106
The vote on the rule was 228 yeas to 175 nays.107
Floor Consideration of the Bill. On July 30, 1996, the House commenced
debate on H.R. 2391 itself. Representative Goodling, chairman of the reporting
committee, explained that 20 changes had been made in the legislation since it was
introduced, “all supporting the employee,” with further changes to be added on the
floor. He then set about “to correct the misinformation and the disinformation that
was distributed Friday.” Mr. Goodling reaffirmed that “[t]he choice to take overtime
compensation in the form of paid time off must be voluntary and must be requested
by the employee” and pointed to prohibitions against threats, intimidation, etc., of
workers by their employers where the comp time option is concerned. Chairman
Goodling stressed safeguards, remedies and protections in his defense of the
legislation. Representative Clay, however, branded the legislation “flimflam flextime”
and asserted that it will provide “an excuse to undermine the living standards of
working families.”108
The ensuing debate followed well-established lines. H.R. 2391 “is pro-family,
pro-worker, pro-women” and provides “relief to the hard-working men and women
across our Nation who struggle daily to support their families,” Representative
Myrick observed.
Dads could use the accrued time to make sure they are behind the dugout for
that critical Little League game, and mom and dad could use their time to visit
their child’s school for the parent-teacher conferences, enabling and encouraging
parents to participate in their child’s education.
Ms. Myrick added: “Even the President and Vice President endorse giving workers
the option to spend more time with families.”109
104 Congressional Record, July 26, 1996. p. H8571.
105 Congressional Record, July 26, 1996. p. H8571-H8572.
106 Congressional Record, July 26, 1996. p. H8572.
107 Congressional Record, July 26, 1996. pp. H8572-H8573.
108 Congressional Record, July 30, 1996. pp. H8776-H8777.
109 Congressional Record, July 30, 1996. p. H877. The Administration “threatened a veto,
saying the measure would undermine employee rights and allow employers to coerce workers
into taking time off instead of money.” Congressional Quarterly, January 25, 1997. P. 222.
Representative Clay observed that the President has a proposal of his own, but does not
support “the bill that we are debating now. The President thinks this bill is a disaster.”
(continued...)

CRS-28
Representative Andrews, with a 3-year-old daughter, could appreciate Ms.
Myrick’s concern. Yet, he opposed the bill and questioned whether the comp time
option was “truly voluntary” with workers and, were abuse to occur, stated that the
worker “has no meaningful or realistic remedy.” Mr. Andrews had raised this issue
during committee consideration. “I think the employee has a burden of proof that
would be almost impossible to sustain. I think there are some legitimate question[s]
as to under which specific circumstances that employee could, in fact, recover her ...
or his attorney fees.” And, further: “... I think an employee who exercises his or her
right to choose cash rather than comp time would not be able to achieve an effective
remedy if the employer wanted to punish him or her for making that choice.” He
distinguished between the workplace environment of public and private sector
employment. If public sector workers are singled out for unfair treatment, “there is
a set body of law that provides for both substantive remedies and meaningful
procedures in order to enforce their rights. That does not exist in the private sector.”
Noting various other concerns, he affirmed: “I oppose the bill; I urge its defeat.”110
Conversely, Subcommittee Chairman Ballenger argued that the comp time
measure was “commonsense legislation” and affirmed that “employees want it.” He
declared: “American workers want and deserve flexibility in the workplace to better
deal with the challenges of balancing work and family obligations.” In contrast to
Representative Andrews, Mr. Ballenger concluded: “I urge my colleagues to support
this legislation which will allow American men and women to make the choice for
themselves between extra money or paid time off.”111
With strong industry support, H.R. 2391 was being urged as family friendly and
pro-worker. Representative McKinney queried: “Does anyone believe for 1 minute
that workers were consulted on this bill?” For the absence of labor support
112
,
Representative Shays suggested one answer: that it was “really a debate between
union leaders and rank-and-file members.”113
Proponents and opponents divided on whether comp time would actually be
voluntary. Representative Riggs assured his colleague that the bill, “... [in] explicit
language ... prohibits an employer from compelling an employee to take compensatory
time, or time off, in lieu of overtime compensation. So no employee in any
(...continued)
109
Congressional Record, July 30, 1996. p. H8779.
110 Congressional Record, July 30, 1996. pp. H8777-H8778.
111 Congressional Record, July 30, 1996. p. H8778.
112 Congressional Record, July 30, 1996. p. H8783.
113 Congressional Record, July 30, 1996. p. H8783. It was possible that the proponents of
H.R. 2391 had a better understanding of the concerns of workers than did the trade union
leadership. It was also possible that the comp time bill was simply industry-oriented
legislation: “skillfully titled” (the “Working Families Flexibility Act”), suggested
Representative Pomeroy. “Perhaps it is unintentional, but unfortunately this bill represents
yet another proposal put forth by the majority which will increase the strain on working
families and jeopardize our nation’s basic workplace protections.” See, ibid, p. H8786.

CRS-29
occupation in any industry can be compelled to take compensatory time off...” Ms.
114
Schroeder viewed things differently.
We hear people saying, ‘oh, employers will not compel employees to say they
would rather have time off than pay, time-and-a-half pay.’ Oh, yeah? Show me
the employer that would rather give you money than time off. Employers are
going to say, “You want to work here, this is a voluntary decision. If you
voluntarily decide you want to work here, then you better bloody well volunteer to
sign this thing saying if there is any overtime you will take time off rather than get
money.”
Ms. Schroeder added: “Let us be real clear about this. When people are working at
those kinds of levels of jobs, they cannot negotiate with their employer ... Either they
will never get overtime, or they will not get hired at all.”115
What was really needed, Ms. Schroeder argued, was “predictability.” “We need
to be able to predict when we have to work and predict when we are going to have
time off so that we can tell the school we can be there to help with the kids...” “If my
child is going on a field trip,” he explained, “that is when I need to have the time off,
not 3 weeks later when it is a convenience for the employer. That is why this bill is
a joke...”116
As debate drew to a close, Representatives Goodling and Ballenger proposed a
series of amendments dealing, primarily, with employee protections (discussed
below). Representative Clay, opposing the measure, argued that the bill “should not
have been reported out of committee without basic employee protections in the first
place” though he applauded his colleagues for “belatedly recognizing that their bill has
many flaws.” The supplemental amendments, he maintained, though numerous, were
insufficient “to rescue a bill that is fatally flawed.”117 Similarly, Representative
Becerra asked how a good bill (“and that is what we were told [it was] when it left
the committee”) should suddenly need “more than 20 changes being made now at the
last moment now that it is on the floor to try to correct all these problems in the
bill.”118
The amendments to H.R. 2391 were approved. On passage of the amended
bill, the vote was 225 yeas to 195 nays.
Amended Version Passed by the House. In the amended bill, choice (and, thus,
flexibility) continued to rest in the first instance with the employer. “An employer”
may offer compensatory time off to an employee. If the employer declines to make
that offer, that ends the matter. If the employer agrees to initiate a program, the
114 Congressional Record, July 30, 1996. p. H8783.
115 Congressional Record, July 30, 1996. p. H8784.
116 Congressional Record, July 30, 1996. p. H8785.
117 Congressional Record, July 30, 1996. p. H8788-H8789.
118 Congressional Record, July 30, 1996. p. H8790. The proposed changes in the legislation
were being offered by supporters of the measure.

CRS-30
design of the program (how many hours to be offered, which of his employees may
participate in the program, on what terms banked hours may be drawn down, etc.)
remained with the employer. Where there was a union presence, employees may have
a right to bargain with respect to the option. Where there was no collective
bargaining agreement and no official employee representative, individual workers
would negotiate with their employers.
The issue of the use of accrued hours remained: i.e., definition of “within a
reasonable period” and “does not unduly disrupt the operations of the employer.”
Both concepts would need to be defined in regulation or would be left to the
discretion of the employer. The scheduling of hours of work in excess of 40 per week
(from which the comp time flows) is an employer prerogative.
As approved by the House, the bill would allow private sector employees to
accrue up to 240 hours of comp time; but, under the floor amendments, all time “in
excess of 80 hours” may be cashed-out by the employer with “at least 30 days notice”
to the worker. Further, an employer could unilaterally discontinue the program “upon
giving employees 30 days notice.” A private sector employee, in the absence of a
119
collective bargaining agreement, etc., would be able to terminate his individual
agreement to accept comp time “at any time.”120
Employee remedies for violation of a worker’s rights were broadened by the
floor amendments. As reported, an employee had to prove that his employer had
“willfully” violated the admonition not to “directly or indirectly intimidate, threaten,
or coerce,” etc., with respect to participation in or utilization of the comp time option.
The word “willfully” was dropped from the legislation as passed. The Secretary of
Labor was directed, within 30 days after enactment, to develop language that
employers could post notifying workers of the comp time option and of their rights
were such a program to be developed by an employer.
H.R. 2391 was essentially enabling legislation: it waived FLSA overtime pay
requirements, where necessary, to allow employers to develop comp time programs.
Though critics expressed concern for protection of worker rights, further worker
rights protections could have made the legislation administratively top-heavy,
preventing achievement of the goals of the bill’s sponsors.121
119 It may not be entirely clear what would become of accrued comp time under the 80-hour
limit, were an employer to terminate the program. The legislation may permit a cash-out at
the termination of the program; but, it is also possible that the comp time below 80 hours
would continue to be drawable by employees until used or until the end of the program year.
Where a comp time program has become part of the collectively bargained agreement (or of
another agreement with an official representative of the workers), it may not be clear the
extent to which an employer could terminate the program at will.
120 Because the language of the legislation, as approved by the House, grants a right of
termination of the comp time agreement only to workers covered under paragraph (2)(A)(ii),
it may not be clear whether a worker, covered by a collective agreement, may similarly
withdraw from the program — either at all or at his or her own individual choice.
121 When legislation of this sort is signed into law, it is passed along to the administering
(continued...)

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The Ashcroft Proposal
On August 7, 1995, Senator Ashcroft introduced S. 1129, the “Work and Family
Integration Act.”
122 He stated that the “rigid and inflexible” overtime pay provisions
of the FLSA have paralyzed those it was meant to help. “The FLSA,” he continued,
“now deprives employees of the right to order their daily lives on and off the job to
meet the responsibilities of work and home.”123
General Provisions of S. 1129. S. 1129 would have added a new subsection
to Section 13 of the FLSA (exemptions). First. It would have allowed employers to
set aside the standard 40-hour workweek and replace it with a 160-hour basic work
requirement: i.e., 160 workhours “over a 4-week period, that is scheduled for less
than 20 workdays.” Second. Within the 160-hour period, employers would have
been allowed flexibility in arranging work schedules: that is, any arrangement of
hours so long as the total for the 4-week period did not exceed 160. Within the 4-
week/160-hour period, no overtime pay would have been required. Third. If it were
deemed appropriate to schedule more than 160 workhours in a 4-week period, then
those employees participating in a flexible credit hour program (under the legislation)
could have worked up to 48 hours beyond their regular 160 hours — carrying over
the excess 48 hours “to a succeeding 4-week” period as “credit hours.” Fourth.
Hours worked in excess of 160 (credit hours) would have been credited to the
employee at a straight-time rate. Thus, it appears, time-and-a-half would not be
required until an employee had worked 208 hours in a single 4-week period (i.e., 160
regular workhours plus 48 credit hours). Fifth. The employer would have been
allowed to establish a program of flexible scheduling that would have stood alone,
within the existing 40 hour workweek, or have been combined with the 160-hour
work period for greater flexibility. Sixth. No employee could have been “required
to participate” in the flexible and compressed scheduling program: any threat,
intimidation or coercion on the part of the employer would have been prohibited.
Were an employee to decline to participate in the compressed or flexible workhours
program, he or she could still have been required to work in excess of 40 hours a
week; but, in that case, the overtime pay provisions of current law would have
applied.124
The proposal would have divided workers and workplaces into two groups.
First, there were those covered by a collective bargaining agreement (union workers)
which would govern implementation of the scheduling arrangements. Second, there
(...continued)
121
agency (here, DOL) which, then, develops implementing regulations. While such regulations
may resolve any remaining ambiguities of the legislative language, they may also add to the
burdens of employers in the utilization of the option.
122 S. 1129 was referred to the Senate Committee on Labor and Human Resources. On
December 6, 1995, companion legislation (H.R. 2723), introduced by Representative
Doolittle, was referred to the Committee on Economic and Educational Opportunities.
123 Congressional Record, August 7, 1995. p. S11788.
124 How such concepts as threat, intimidation and coercion might have been interpreted in the
various working environments seems unclear.

CRS-32
were those not covered by a collective bargaining agreement (for the most part, non-
union workers), in which case the program drawn up or authorized by management
would have been controlling.
In addition, S. 1129 dealt with a series of other issues. It allowed for the priority
rehiring of former employees, under certain conditions, without incurring penalties of
law: e.g., civil rights, discrimination, seniority, pension requirements, etc. It modified
Section 13(a)(1) of the FLSA with respect to leave and overtime pay policies for
salaried workers — an issue that has been in contention for several years. And, it
125
brought the Federal Employees Flexible and Compressed Work Schedules Act into
conformity with the 160-hour 4-week formula of the Ashcroft legislation.126
The Senate Hearing, February 1996. In the original FLSA of 1938, “it was
fairly simple to determine which employees were entitled to overtime pay and which
were not,” Labor and Human Resources Committee Chair Kassebaum noted in
opening the February 27, 1996, hearing on overtime work. Through the years,
Congress has amended the statute and DOL has developed regulations to implement
those amendments. Thus, Senator Kassebaum noted, “what was once a simple
process has given rise to a confusing maze of rules and regulations about how the law
should be applied in each workplace.”127
Comments by Senator Ashcroft. Through the past half century, observed
Senator Ashcroft, the lead witness, the demographics of the workforce have changed:
from a primarily male workforce to one in which “75% of the mothers with school-
age children work.” Thus, he proposed to allow employers (with agreement by their
employees) to modify the FLSA overtime pay requirements in the name of greater
flexibility.
There is a real need for workers to be able to devote more time to their
families ... Flexible work schedules would give employees more control over their
lives by allowing them to balance family and work obligations better. In addition,
125 Salaried workers are generally overtime pay exempt under Section 13(a)(1) of the FLSA
and are normally more highly paid executive, administrative or professional workers. When
such employees work extended hours (beyond 40 hours in a week), they are not paid overtime
because they are on a straight salary and, as professionals, etc., are expected to do what is
required of them. However, when a salaried worker, having worked overtime without extra
pay, needs to be absent from work for an hour or two for personal reasons, some employers
have chosen to “dock” the pay of the employee for that absence. The Department of Labor
has ruled that such “docking” may convert the exempt employee into a nonexempt employee
and subject the employer to the payment of overtime wages where hours are worked in excess
of 40 per week.
126 Federal employees, covered by the Federal Employees Flexible and Compressed Work
Schedules Act (1978, as extended), may work compressed schedules of 80 hours, however
structured, within a 2-week period without the employer being subject to overtime pay
requirements.
127 U.S. Congress. Senate. Committee on Labor and Human Resources. Oversight of the
Fair Labor Standards Act. Hearings, 104th Cong., 2 Sess., February 27, 1996
nd
.
Washington, U.S. Govt. Print. Off., 1996. p. 1. (Hereafter cited as Senate Hearings, 1996).

CRS-33
employees may attend to family needs without using limited sick leave allowances.
And under compressed schedules, day care expenses could be reduced by as much
as 20%.128
The Senator observed that overtime pay and the 40-hour workweek could prevent a
parent from attending child/family related activities scheduled for a Friday
afternoon.
129 He pointed to the popularity of flexible and compressed scheduling for
the Federal sector, cited President Clinton’s endorsement of workhours flexibility,
noted that “balancing work and family obligations” was the number one concern of
working women, and concluded: “...to combat the rigidity of the Fair Labor
Standards Act, I have introduced the Work and Family Integration Act” (S. 1129).130
General Testimony. The remainder of the hearing was conducted in a seminar
format with Senator Ashcroft joining the other panelists. Participants in the seminar
included: Maggi Coil, Motorola, Inc.; Michael Leibig, an attorney in private practice;
Arlyce Robinson, Computer Sciences Corporation; Douglas Knight, the Boeing
Company; John Shamley, deputy director of personnel, Government of the District
128 Senate Hearings, 1996. pp. 2-3.
129 This argument, the soccer mom thesis (the inability of a worker to be off on a Friday
afternoon child-related function, such as a soccer game), would frequently be reasserted
through debate on this issue. When introducing S. 4 in the 105th Congress (discussed below),
Senator Ashcroft stated: “...it is against the law for an employer to agree with his employee
that the employee can take time off on Friday afternoon to see his daughter get an award at
the local high school and to make up that same time on Monday. The strict laws about hours
and overtime,” he emphasized, “make it difficult for that to happen, make it impossible, make
it illegal.” Congressional Record, January 21, 1997. p. S221.
Under current law, a parent wishing to take time off on a Friday afternoon, would be
permitted, were the employer agreeable, to work extra time on the prior Monday, Tuesday,
Wednesday, etc., or even on Friday morning, to offset the time away from work on Friday
afternoon. This, of course, would require some measure of planning — as would utilization
of the comp time option. An employee, with the agreement of the employer, could also take
leave without pay or annual leave. If the need were a medical emergency, the Family and
Medical Leave Act could, in some cases, provide an option.
Various witnesses did comment on the question of the need for anticipatory scheduling
of comp time use. For example, Pete Peterson of Hewlett-Packard, testifying for the FLECS
Coalition in support of H.R. 2391, observed with respect to the use of the comp time option:
“...it can’t be just the employee saying, I want to take it [comp time] right now, no matter
what.” See House Subcommittee on Workforce Protections, Hearings, 1995. p. 446. The
same position was taken by Kathleen Fairall of The Timken Company, speaking for SHRM
and for the FLECS Coalition. When asked by Mr. Romero-Barcelo concerning comp time
utilization, she responded: “...I think they would have to — it would be a mutually agreeable
scheduling. I mean, they couldn’t come up tomorrow and say I want to take tomorrow off as
my compensatory time...” See House Subcommittee on Workforce Protections, Hearings,
1995. p. 233.
130 Senate Hearing, 1996. pp. 2-4.

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of Columbia; Phyllis G. Diosey, Malcolm Pirnie, Inc.; and E. Glenn Baker, John Alden
Life Insurance Company.131
Pay Docking. Initially, discussion focused upon pay docking, one of the issues
dealt with in the Ashcroft bill. The Ashcroft bill (S. 1129) would modify Section
132
13(a)(1) of the FLSA so that an “executive, administrative, [or] professional”
employee would be both overtime pay exempt and subject to having his or her pay
docked should the employer choose to do so.
In an exchange between Senator Ashcroft and attorney Leibig, the Senator
suggested that, under the present system, one had flexibility to allow employees to
take short term leave if one were willing to “pay people for not showing up.” Leibig
countered: “They have the flexibility now to pay people salary or hourly.” I
133
f
workers are paid on an hourly basis and they absent themselves for a few hours, the
employer can dock their pay under current law; however, if they are salaried
employees, the employer cannot dock their salary for short absences without risking
their conversion of nonexempt status. The choice rests with the employer.
Senator ASHCROFT. So your view is that it should be a rigid 40-
hour week, and if a person wants to take 2 hours off on Friday afternoon
to attend to a sick child, he or she should not be allowed the flexibility of
volunteering to make that up the next week without some sort of penalty
... Is that your view?
Mr. LEIBIG. No ... It is my feeling that there should be a national
standard for a 40-hour work week, but that it should be flexible in areas
where it is necessary.
For instance, today, under the Family Leave Act, if people need to
take time off to take care of a sick child and so forth, there is flexibility
already.
131 Several of the witnesses had appeared at prior hearings on overtime issues. Diosey, Leibig,
Robinson and Coil testified before the House Subcommittee on Workforce Protections in
1995. See: U.S. Congress. House. Committee on Education and Labor, Subcommittee on
Labor Standards, Occupational Health and Safety. Hearing on the Fair Labor Standards
Act. Hearings, 103 Cong., 1
rd
st Sess., July 1, 1993. p. 32; and, U.S. Congress. House.
Committee on Economic and Educational Opportunities, Subcommittee on Workforce
Protections. Hearings on the Fair Labor Standards Act. Hearings, 104th Cong., 1st Sess.,
March 30, June 8, October 25, and November 1, 1995. pp. 16, 54, 63, 208, and 456. In
1995, Ms. Coil had testified both for Motorola and the Labor Policy Association.
132 Speaking generally, this issue involves two classifications of employees. Salaried workers,
normally more highly paid administrative, executive and professional employees, may be
exempt from the overtime pay requirements of the FLSA. When, as professionals, etc., they
work a few hours beyond 40 in a week, their salary is unchanged. But, then, neither are they
docked if they need to absent themselves from the workplace for a brief period. Hourly
workers, often earning substantially less, are nonexempt and are paid overtime for hours
worked in excess of 40 per week, but their hourly wages are docked when they absent
themselves from the workplace for brief periods.
133 Senate Hearings, 1996. pp. 14-15.

CRS-35
The CHAIRMAN [Senator Kassebaum]. But Mr. Leibig, isn’t that
only for employers of 50 employees or more?
Mr. LEIBIG. Sure. Small employers are not covered by the other
rules, either, and if it is a question of whether the Family Leave Act should
be expanded to employers of less than 50, if that is the debate, I guess I
would favor expanding it...
Leibig added: it is one thing for workers to have comp time available for certain
needs, “especially ... at their own choice. But it is another thing to say we should
abandon a basic 40-hour work standard and allow the work week to get longer and
longer.”134
The Worker’s Choice? Throughout, a central issue related to whether flexibility
could be secured at the worker’s choice or at the employer’s convenience.
Senator Ashcroft affirmed: “The proposed change to the statute is to give the
employee the option, not to give the employer the option, and I think those are
different questions.” Mr. Leibig concurred that choice was the issue, but disagreed
on the substance of S. 1129 at it stood.
Mr. LEIBIG. ... If there is a provision that the employee has absolute
access to get comp time, and, for instance, after the comp time is in the
bank, the employee has the right of when to take it off and when to use it...
Senator ASHCROFT. I think that is the nature of the proposal...
Mr. LEIBIG. The bills that have been introduced in the House and
your own bill do not have that. S. 1129 — you may intend to put it in
[employee choice], and I think that should be encouraged, but it is not in
there now.
Senator ASHCROFT. Well, it certainly is at the employee’s option,
not at the employer’s choice.
Mr. LEIBIG. It is the employee’s option to take the comp time, but
135
once he has it, it is not at his or her option whether to use it or have access
to it; it is controlled by the employer — or, at least it is allowed to be
controlled by the employer under the way the bills are.136
Discussion then moved on to other aspects of the Act, the various witnesses joining
in the discourse with prepared statements and responding to questions.
An Overview of the Hearing. Although the focus of the hearing was S. 1129
(the compressed schedule, comp time and pay docking), the seminar portion of the
134 Senate Hearings, 1996. p. 16.
135 As the legislation was introduced, the first option would have been the employer’s: whether
or not to institute a comp time program. Then, if the employer offered such a program, the
employee would have had the option of participation — assuming that he or she was part of
the covered group of workers. The use of comp time (the timing of the drawing down of
banked hours) would then be left to the discretion of the employer.
136 Senate Hearings, 1996. pp. 17-18.

CRS-36
session was more wide-ranging. Also discussed was the wage/hour treatment of
“bona fide executive, administrative, or professional” employees and those employed
“in the capacity of outside salesman.” Questions were raised concerning “waiting
time,” “on-call” status, “break time,” “sleeping time,” “training time,” “travel time”
(including commuting in company vehicles), “unauthorized work” (the concept of “to
suffer or permit to work”), calculation of the “regular rate” for overtime pay
purposes, what to do about “supplementary earnings such as commissions, bonus,
shift premiums, etc.” and the distinction between “discretionary bonuses” and
“nondiscretionary bonuses” for wage/hour compliance. Each of the issues involved
technical and complex interpretation of the statute and of its implementing
regulations.
Chairman Kassebaum, at various points, observed that the regulations were
“convoluted”137 and that the Act and its implementation was “enormously
complicated” and with “enormously burdensome requirements.” That, she noted, “is
why we are trying to understand and sort through this to see where we can perhaps
address it in some constructive way.”138 Through the course of the hearings, there
was some disagreement as to how the statute was applied, what the courts and the
Department of Labor held, and what options for flexibility existed under current law.
No one from DOL was present to explain that agency’s interpretation of the Act or
its procedures for enforcing it.139
Toward the end of the session, Leibig noted “that all of the witnesses who are
here today, except the ones who are lawyers, are people who did not benefit or say
they did not benefit from the Fair Labor Standards Act.” He suggested that “many
Americans do benefit” from the Act and that “there are employers who will take
advantage of workers.” “It would be a good idea at some point,” Leibig suggested,
“for the committee to hear some of the workers who do feel they need the protection
of the Act. I think it is unusual that none were invited or are here.” Chairman
Kassebaum responded: “Well, Mr. Leibig, I would guess that everyone here would
agree with you, that they would not want an employer to abuse the Fair Labor
Standards Act.”140
Overtime Pay and Comp Time: The 105 Congress
th
As preparations began for the 105 Congress, changes in overtime pay la
th
w
remained an issue. Receiving “top priority” among emerging labor issues, stated Tim
137 Senate Hearings, 1996. p. 28.
138 Senate Hearings, 1996. p. 43.
139 Leibig, an attorney in private practice, functioned during the hearing as a wage/hour
technician, but his views were not necessarily concurred in by other panel members. Maggi
Coil of Motorola and John Shamley from the District of Columbia Government were
introduced as “two distinguished wage and hour experts who have taught seminars on FLSA
... through the American Compensation Association” of which Coil was then president.
Neither, of course, was able to speak for the Department of Labor.
140 Senate Hearings, 1996. p. 34.

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Shorrock of the Journal of Commerce, “is a Republican bill designed to make the
U.S. workplace more flexible” through the use of comp time. “That’s not only good
for employees,” observed Sandra Boyd of the Labor Policy Association, “it’s good
for the bottom line.” Peggy Taylor of the AFL-CIO was less enthusiastic, suggesting
(in Shorrock’s summary) that the initiatives “could gut the 40-hour week and make
workers vulnerable to pressures from employers to take time off instead of overtime
pay.”141
Under date of December 17, 1996, Representative Goodling, chair of the full
Committee on Education and the Workforce, circulated a “Dear Colleague” letter
inviting Members to become co-sponsors of new comp time legislation that will be
“the same as H.R. 2391, as passed by the House on July 30, 1996.” A roughl
142
y
parallel letter was dispatched on January 2, 1997, by Representatives Shays and
Myrick.
143
On January 8, 1997, a “group of House Republican women ... endorsed
what they called `family friendly’ legislation” to allow the use of comp time in place
of overtime pay. Meanwhile similar interest was rising in the Senate. By lat
144
e
January, The Wall Street Journal reported that “Republicans and business groups will
be taking their fight directly to the public” which, a survey by “the pro-business Labor
Policy Association” suggests, supports the concept of flexibility overwhelmingly.145
Workhours Legislation Reintroduced
On January 7, 1997, Representative Ballenger introduced a new comp time bill
(H.R. 1), the “Working Families Flexibility Act.” The bill was referred to th
146
e
Subcommittee on Workforce Protections which Mr. Ballenger chaired. On January
21, 1997, Senator Ashcroft introduced S. 4, the “Family Friendly Workplace Act”147
which was referred to the Subcommittee on Employment and Training chaired by
Senator DeWine, a co-sponsor of the legislation.
The New Ballenger Bill (H.R. 1). H.R. 1 differed in some respects from H.R.
2391 of the 104 Congress. In the earlier legislation, Mr. Ballenger had proposed a
th
restructuring of Section 7(o) of the Act, dealing only with wage/hour coverage for
state and local government workers, to expand its provisions in a modified form to
the private sector workforce. In H.R. 1, Mr. Ballenger proposed adding a new
Section 7(r) to the Act that would deal only with private sector workplaces.
141 Shorrock, Tim. “US Firms Prepare To Square Off with Labor on Work Laws.” Journal
of Commerce. December 26, 1996. pp. A1 and A5.
142 Dear Colleague Letter, Representative William Goodling, December 17, 1996.
143 Dear Colleague Letter, Representatives Christopher Shays and Sue Myrick, January 2,
1996.
144 Daily Labor Report, January 9, 1997. pp. A1-A2. Those issuing the endorsement
included Representatives Molinari, Fowler, Dunn, Myrick, and Granger.
145 The Wall Street Journal, January 28, 1997. p. A18.
146 Congressional Record, January 7, 1997. p. H66, E42-E43.
147 Congressional Record, January 21, 1997. p. S158.

CRS-38
Like its predecessor, H.R. 1 based the comp time option on a time-and-a-half
formula, distinguished between workers with a collective bargaining or other
representational agreement and nonunion workers, and left the early initiative to the
employer, but provid
148
ed most of the worker protection that had been built into the
prior legislation through amendment. Employers and employees would enter into “an
agreement or understanding” with respect to comp time. H.R. 1 required that the
agreement (a) be arrived at “before the performance of the work,” (b) that it be
entered into “knowingly and voluntarily by such employee,” (c) that it was “not a
condition of employment,” and (d) that it
149
must be “a written or otherwise verifiable
statement.” The employer could not “directly or indirectly intimidate, threaten, or
coerce or attempt to intimidate, threaten, or coerce” any employee with respect to the
option.
Employees could accrue a maximum 240 hours of comp time, and unused hours
would have to be cashed out at the end of a 12-month period. However, an employer
could cash-out all hours banked in excess of 80 at any time upon 30 days notice to the
employee. The employer would be allowed to discontinue the comp time option upon
a 30 days notice to the employee; the employee, to rescind his agreement to
participate, giving a written notice, at any time. Within 30 days thereafter, the
employee would be given monetary compensation for his banked hours. H.R. 1 made
clear that an employee who terminated his employment, “voluntarily or involuntarily,”
would be paid for unused comp time. H.R. 1 retained the language providing for the
use of comp time “within a reasonable period of time” when it “does not unduly
disrupt the operations of the employer.” Penalty and posting requirements also
appeared in H.R. 1.
The New Ashcroft Bill (S. 4). S. 4 was comprehensive and covered areas not
dealt with in H.R. 1. It set forth several workhours options. And, in addition, the bill
dealt with certain other aspects of existing law. Among its provisions were th
150
e
following.
Compensatory Time Off. Like H.R. 1, S. 4 began by adding a new Subsection
(r) to Section 7 of the FLSA. Its provisions were similar to those of H.R. 1,
establishing the same general options and requirements.
Biweekly Work Programs. Under S. 4, an employer would be allowed to
establish a 2-week 80-hour work period during which, without incurring an overtime
penalty, an employer could schedule work in any manner: 2 weeks of 40 hours each,
60 hours in one week and 20 hours in the other, etc. He would not have been
required to pay overtime rates (time-and-a-half) until after 80 hours had been worked
148 As in the earlier legislation, the employer would determine the structure or scope of the
option or the restraints imposed upon its utilization.
149 The concepts, “knowingly and voluntarily,” were not defined, potentially a significant
matter were the worker unaccustomed to American labor-management practices, uncertain of
his legal rights, or not fluent in English, or with respect to the requirement that the agreement
not be “a condition of employment.”
150 The text of S. 4 appears in the Congressional Record, January 21, 1997, pp. S222-S224,
and is available on Thomas.

CRS-39
in 2 calendar weeks. For hours worked in excess of 80 in a 2-week period, a worker
could be compensated either in cash or in paid comp time — each at not less than a
time-and-a-half basis. A worker would have been allowed to participate in this
biweekly compressed scheduling with the option, set forth in the legislation, of
declining.
Flexible Credit Hour Program. An employer, at his initiative (but in conformity
with a collective bargaining agreement, where there is a trade union presence), was
to be allowed to establish a “flexible credit hour program.” Once the program had
been established, the employee would then have been allowed to elect whether to
participate. Where a worker chose to participate in a “flexible credit hour program,”
he and his employer would then “jointly designate hours for the employee to work
that are in excess of the basic work requirement of the employee so that th
151
e
employee can accumulate flexible credit hours to reduce the hours worked in a week
or a day subsequent to the day on which the flexible credit hours are worked.”
Compensation for “flexible credit hours” would have been on a straight time
basis. An employee would not have been allowed to “accumulate” more than 50
flexible credit hours at any one time. There were cash-out provisions. An employee,
as in the comp time program, could not have been forced to participate in the credit
hours option.
An employee would have been permitted to work through a 40-hour workweek
(or an 80-hour biweekly work period). Then, in agreement with his employer, in lieu
of the overtime pay requirements of the FLSA, up to another 50 hours to be worked
on a straight time basis and designated at credit hours.
Salary Practices Relating to Exempt Employees. As currently administered,
the pay of a salaried worker (one deemed a “bona fide executive, administrative, or
professional” employee) may not be “docked” for brief absences from his or her
workplace (an hour or two) since, as noted above, he may be called upon to work
overtime hours without pay because of his or her status as a professional, etc. If the
pay of such a salaried worker is docked, he may be converted from overtime pay
exempt to nonexempt — causing the employer to pay extra for overtime hours
worked.152
S. 4 would have amended the FLSA by adding a new Section 13(m). It would
have permitted a salaried worker’s pay to be docked for short absences from his
workplace.153
151 It appears that the “basic work requirement” (one’s pre-overtime work period) would be
40 hours or, if participating in a bi-weekly work program, 80 hours.
152 Congressional Record, January 21, 1997. p. S225.
153 CRS Report 92-761, The Overtime Pay Exemption for Salaried Employees: The Salary
Basis Test Issue, by Charles Ciccone.

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Hearings of the 105 Congress
th
Hearings on comp time and related issues commenced early in the 105th
Congress, moving between the Senate and the House — and between S. 4 and H.R.
1. The arguments, pro and con, largely resembled those of 1995 and 1996; little
appeared to have changed.
The Senate: Opening Hearing. On February 4, 1997, the Senate
Subcommittee on Employment and Training, chaired by Senator DeWine, conducted
a general hearing on overtime pay issues under the FLSA. Senator Hutchison of
Texas, the lead witness and a cosponsor of S. 4, presented an appeal for flexibility.
She noted that the FLSA had been crafted “in the wake of the Great Depression to
protect workers from abusive conditions,” but suggested that such protection was no
longer necessary. “Now, employers are much more attuned to the needs and
preferences of their employees.” Senator Hutchison declared S. 4 “a win-win
situation for both workers and their employers.”154
Sandra Boyd, speaking both as Chair of FLECS and as Assistant General
Counsel of the Labor Policy Association, noted that “many companies have
implemented creative workplace programs” but that “they are limited in what they can
provide” because of the overtime pay requirements of the FLSA. “The employers I
represent know that providing flexibility in the workplace is a win-win,” she affirmed.
Boyd explained the various provisions of S. 4 and concluded that “finding solutions
to the needs of employers and employees seeking to increase workplace flexibility
won’t be easy” but “[l]ifting the current roadblocks in the FLSA ... is a critical first
step.”155
Several pro-flexibility speakers followed. Michael Losey, president of the
Society for Human Resource Management (SHRM), branded the FLSA as “outdated
and, in some cases, even unfriendly to our nation’s businesses and their employees.”
He observed that “employers find themselves constrained by the FLSA when
attempting to offer workers greater flexibility.” SHRM also endorsed the extended
work period (80 hours over 2 weeks) as provided in S. 4. Mark Wilson, speaking
156
for The Heritage Foundation, expressed similar views. The FLSA, he stated, “was
enacted to protect unskilled, low-pay workers. But in today’s economy, where both
parents are likely to be working, its rigid and inflexible provisions hurt more than they
help.” Wilson opined: “The FLSA deprives workers of the right to order their daily
lives, both on and off the job, to meet the responsibilities of work and home.” He
found it “disturbing” that “only 15.3 percent of all private full-time employees were
154 Daily Labor Report, February 5, 1996. pp. E5-E6.
155 Statement of Sandra J. Boyd, February 4, 1997.
156 Statement of Michael R. Losey, February 4, 1997. A summary of SHRM’s broader
attitude toward the FLSA, attached to Losey’s statement, indicates opposition to an increase
in the minimum wage, support for a 160 hour pre-overtime monthly work period, support for
wider employment of unpaid volunteers, support for pay docking, etc.

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working on flexible schedules.” William Kilberg, Solicit
157
or of Labor during the Ford
Administration, a frequent witness on FLSA issues, protested that “the FLSA’s 60-
year-old structure far too often works against the interests and desires of the
employees it purports to protect.” He, too, called for “flexibility.”
158
“One of the biggest backers for amending the overtime law is TRW Inc.,”
according to The Wall Street Journal. As the Senate hearing approached, The
Journal conducted a number of interviews with persons interested in changing the
overtime pay requirements of the FLSA: among them, Christine Korzendorfer, an
executive assistant with TRW. Korzendorfer noted that she had “lost ‘hundreds and
hundreds of dollars’ during her last pregnancy after her doctor ordered her to stay in
bed for a month. If she had been allowed to accumulate comp time,” Korzendorfer
argued, “she could have traded in those hours and not lost pay for the days she
missed.” The Journal concluded: “Now pregnant again, she worries about a
repeat.”
159 Accompanied by Sallie Larsen, TRW Vice President for Human Resources
and Communications, Korzendorfer also testified before the Subcommittee on
Employment and Training.160
A different perspective was presented by Karen Nussbaum, Director of the
Working Women’s Department, AFL-CIO. “For the past 25 years,” Ms. Nussbaum
began, “I have been an advocate for working families and particularly working
women.” She noted the number of women now in the workforce and argued that “the
vast majority of working families — the bottom 80% — are seeing their incomes
stagnate or fall behind.” She asserted:
... there’s a gap in work and family policies, as well. Despite the fact that low-income
families need family-friendly workplaces even more than do high-income earners —
because their lower pay limits their ability to purchase flexible dependent care and
157 Statement of Mark Wilson, February 4, 1997. In contrast to Wilson’s contention is the
testimony of a later witness, Edith Rasell of the Economic Policy Institute who stated:
“...under current law employers can allow employees to vary their arrival and
departure time and take time off during the day, even while requiring a specified
number of hours to be worked each week. Under current law, employers can offer
workers a compressed work week such as four ten-hour days per week, permitting
one additional day off per week. Employers can reduce the length of the usual
work week. Job sharing can be encouraged. All this and more is possible.
However, while many companies say they support such policies, they are actually
used in very few firms and by very few people. A survey of 121 private
companies found that just 14% routinely made available a flextime program.
Moreover, 92% of those without a flexitime program said it was unlikely they
would adopt such a program in the future.... Only 10% of full-time hourly workers
have flexible work schedules...”
158 Statement of William Kilberg, February 4, 1997. Kilberg, represented the Coalition for
Fair Labor Standards Act Reform, “a group of employers and associations,” associated with
FLECS.
159 The Wall Street Journal, January 28, 1997. p. A18.
160 Statement of Christine Korzendorfer, February 4, 1997.

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take unpaid leave — it is higher-income employees who are more likely to have
company-supported child care, job sharing, and paid leave.
Nussbaum, who previously served as Director of the Women’s Bureau at DOL,
acknowledged that flexibility was a primary concern for working women. “But the
more important issue here is control over working hours. Women around the country
have explained to me,” she recalled, “that ‘flextime’ that provides flexibility to the
employer — but that wreaks havoc on a[n] employee’s schedule — is no solution.”
She presented a number of examples:
... the bank executive who was expected to work late with no notice; the waitress
at a diner, who was changed to the night shift, despite the fact that she had no child
care for evening hours: and the nurse, scheduled to work a second shift shortly
before her first shift ended. When you ask these workers, and many like them, if
changing the 40-hour work week helps them, they respond with a resounding ‘no.’”
She continued: “When low-income workers choose to work overtime, they do it for
the money.” She urged that the Family and Medical Leave Act be expanded, that
“higher standards for fair pay” be set, and that “paid leave” be assured “for basic
needs.”161
Nussbaum affirmed “the AFL-CIO’s adamant opposition to S. 4” and charged:
“We see nothing family-friendly in taking away from employees the right to overtime
pay and substituting a system of compensatory time off that is riddled with loopholes
and limitations.” And, further: “...we certainly see nothing family-friendly about
expanding the class of employees who are exempt from the Fair Labor Standards Act
and who thus will have no right to either overtime pay or compensatory time off.”
She branded the several proposals “large steps backwards” that would mean “more
control to employers — and less money for workers.”162
The House: Opening Hearing. The following morning, February 5,
Representative Ballenger convened the Subcommittee on Workforce Protection for
consideration of H.R. 1. Mr. Ballenger observed that “American workers want more
flexibility and choices in the workplace to better deal with the challenges of balancing
work and family obligations.” Representative Owens, the Ranking Minorit
163
y
Member of the Subcommittee, countered that the bill would give employers
“complete discretion to determine if they will offer comp time, when they will offer
comp time, and to whom they will offer comp time.”164
In his opening remarks, Mr. Ballenger distinguished between the House and
Senate bills. S. 4 “goes beyond offering comp time and into other issues. There are
those who will attempt to confuse the bills, as a way to try to defeat comp time,” he
remarked. “They do no service to American workers.” He pointed to the work that
161 Daily Labor Report, February 5, 1997. p. E8.
162 Daily Labor Report, February 5, 1997. pp. E8-E9.
163 Daily Labor Report, February 6, 1997. p. E1.
164 Daily Labor Report, February 6, 1997. p. A5-A6.

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had gone into shaping the legislation of the 104 Congress, noted the interest o
th
f
President Clinton is flexible hours legislation, and expressed optimism that H.R. 1
could be passed.165
The first panel was a group of Republican House Members: Representatives
Fowler, Granger and Myrick. Representative Dunn, had been scheduled to testify but
was unable to appear. Each, in turn, reiterated the need for workplace flexibility,
citing their own experiences by way of emphasis. “Today, a significant portion of
employers want to give their employees more flexibility,” Ms. Fowler observed,
adding: “In an ironic twist of fate, however, they are prevented from doing so by the
Fair Labor Standards Act, a law which was passed before many of us were even
born.”166
Other panels followed. Two witnesses associated with TRW, Inc., who had
testified the prior day at the Senate hearing (Ms. Korzendorfer and Ms. Larsen), and
a spokesperson for the Society of Human Resource Management (SHRM) appealed
for workplace flexibility. Each (TRW and SHRM) was associated with FLECS.
Several individuals, in their own behalf, urged that H.R. 1 be promptly enacted. Bob
Weisman, a management attorney from Columbus, Ohio, argued that H.R. 1 should
be considered “as a piece of win-win legislation” and was “baffled by organized
labor’s present objection” to the proposal.167
The women’s perspective was addressed, pro and con, by two of the panelists.
Speaking first was Diana Furchtgott-Roth, a resident fellow at the American
Enterprise Institute and a member of the National Advisory Board of the Independent
Women’s Forum. She was followed by Helen Norton, Director, Equal Opportunity
Programs, for the Women’s Legal Defense Fund.
Ms. Furchtgott-Roth
began with the affirmation that H.R. 1, “if enacted ..
168
.
could improve the welfare of all Americans and will be of especial benefit to working
American women.” Ms. Furchtgott-Roth began: “Under current law, employers are
required to offer to hourly workers only monetary compensation in return for
overtime.” The legislation, she asserted, would be beneficial. It would provide
workers with “a choice” with respect to compensation (time or money). It would
“extend to middle-income Americans those privileges already enjoyed by salaried”
workers. It would “make it easier for women to combine work and family.” It
165 Daily Labor Report, February 6, 1997. p. E1.
166 News Release, Representative Tillie K. Fowler, February 5, 1995. p. 1.
167 Statement of Bob Weisman, House Subcommittee on Workforce Protections, February 5,
1997.
168 The Independent Women’s Forum (IWF), based in Arlington, Virginia, has been described
as “a group of conservative women activists,” “most of them well-educated, well-connected
white professionals.” See, respectively, Human Events, April 14, 1995. p. 11; The Wall
Street Journal, October 13, 1995. p. A16; and The Washington Post, November 30, 1995,
p. D1. Ms. Furchtgott-Roth had been associated with Domestic Policy Council and the Office
of Policy Planning of the Bush White House and, before that, with the American Petroleum
Institute.

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“increases the efficiency of the economy by making labor markets more flexible.” The
bill “represents a prudent use of government authority to enhance the welfare of
American workers.” Ms. Furchtgott-Roth did not address the options, even to private
sector workers under current law, for flexitime, compressed scheduling and even for
comp time within a 40-hour workweek context.
As she proceeded with her prepared statement, Ms. Furchtgott-Roth emphasized
the notion of “choice” for workers, stating the premise: “... giving individuals a
greater number of attractive choices makes them better off.” Further, she affirmed,
the legislation “gives employees, not employers, the power to choose what is in their
best interests, either more time or more money.” She stated that the FLSA was “a
169
well-intentioned law, fashioned in 1938 ... by clever people” who “might never have
imagined comp time as we know it today.” She asserted: “... choice simply is not
available to these employees [”millions of average American hourly workers”] under
current Federal labor law.” She pointed to the increased numbers of women in the
modern workforce, their desire to spend more time with their children even at the cost
of income, and noted that it is “common sense” that “working women ... stand to
benefit the most from H.R. 1, from the additional flexibility in the workplace and
additional opportunities to have more flexible hours.”
Ms. Furchtgott-Roth expressed her belief that many women, not already in the
workforce, might be encouraged to seek employment if a comp time option were
available. She conceded that government might, legitimately, concern itself with
workplace safety and child labor. “But where,” she queried, “is the public interest in
denying employees the choice of comp time?” Then, returning to the FLSA, she
affirmed: “Overtime is simply hours taken away from the life of employees. And yet,
current law denies those employees the opportunity to regain that lost time.” She
conceded that there was concern in some quarters that H.R. 1 “would lead to
exploitation of workers, since employers would pressure employees into accepting
comp time instead of overtime pay. However,” she concluded, “history has shown
that, when workers are given choices, these choices are used fruitfully.”170
Ms. Norton of the Women’s Legal Defense Fund disagreed. The Fun
171
d
“develops and fights for policies that help women meet the dual demands of work and
family and achieve economic security for themselves and their families.” H.R. 1, she
contended, “is not about the real flexibility that working women need ... Instead, it
169 H.R. 1 allows employers the option of establishing a comp time program. Where there is
a union contract, the structure and scope of that option could be subject to negotiation; where
there is no collectively bargained agreement, the structure and scope of the option would be
left to the choice of the employer. The employee has the choice of agreeing to participate or
of refusing to participate.
170 Statement, Diana Furchtgott-Roth before the Subcommittee on Workforce Protections,
February 5, 1997.
171 Based in Washington, D.C., the Women’s Legal Defense Fund, founded in 1971, seeks “to
secure equal rights for women through advocacy and monitoring, and public educations.” It
was an active advocate of the Family and Medical League Act. See Fischer, Carolyn A., and
Carol A. Schwartz, eds. Encyclopedia of Associations, 1996. Detroit, Gale Research Inc.,
1995. p. 2084. Ms. Norton is Director, Equal Opportunity Programs, for the Fund.

CRS-45
gives employees less control over both their time and their paychecks, creating new
risks and problems.”
Suggesting a different view of the world from that of Ms. Furchtgott-Roth, Ms.
Norton argued that H.R. 1 “does not give employees a true choice.” She observed:
... in the real world, employers will have the last word. The bill gives
unscrupulous employers a substantial new opportunity to coerce employees into
taking time off even when they need or prefer to have money in their paychecks
instead.
Most hourly workers have little bargaining power in the workplace as it is.
And they are also the most likely to rely on overtime pay just to make ends meet.
If they insist on getting money instead of time, they run a very real risk. If an
employer would rather keep the money in the bank, employees who do not accept
comp time could find that they just are not getting the hours they have counted on,
or are getting assigned to bad shifts, or have otherwise put their jobs and
livelihoods at risk.
For those who need overtime pay the most, comp time is not a real option,
but it may be one they are directly or indirectly forced to accept. Under this bill,
if an employee is coerced into taking comp time against her wishes, she has just
two choices: accept it, or sue her employer in court. Bringing suit would put her
job at risk and require resources — both time and money — that few hourly
workers really have.
In practice, she suggested, H.R. 1 is not oriented toward the more highly paid salaried
workers but, rather, toward lower-income workers paid on an hourly basis.
Ms. Norton went on to outline what she perceived to be additional hazards.
“Someone who is pressured into taking comp time when she really wants or needs
overtime pay is taking an involuntary pay cut, pure and simple.” Since the employer
controls when the comp time may actually be used, the worker is “essentially being
asked to gamble on the chance that they will be able to take time when it is as valuable
to them as overtime pay.” Under the FLSA, she explained, “when employees work
overtime, they are compensated for it in the week that they worked.” But, under H.R.
1, a worker who accepts comp time “could wait weeks or months before she can use
the hours she’s earned.” She added:
Meanwhile, the overtime pay that she would have received can be invested by her
employer. If the employee decides that she is better off with the cash than waiting
any longer, the employer can take up to 30 more days before putting the money in
her paycheck. The employee has lost money, while her employer has had the
opportunity to make money, on the extra hours she worked.
Further, she pointed to the risk that firms, paying their workers on an hourly basis
(“such as the garment, construction, and janitorial service industries”) may simply
“close up shop without paying employees for their work.” For firms that have a low
capitalization, the banking of comp time (with its cash-out value), she suggests, may
provide an added stimulus for such employer behavior. “The more comp time
workers accumulate, and the longer employers can wait in fulfilling requests for
compensation in time or money,” she noted, “the greater the risk to employees if
employers ‘disappear’ without ever paying for all the hours worked.”

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In Ms. Norton’s view, “H.R. 1 gives the employer — not the employee — the
‘flexibility’ to decide when and even whether an employee can use her earned comp
time.” Should an employee turn to an employer with a request to draw down a few
hours of comp time, the employer “can essentially say, ‘I’ll get back to you,’ and keep
her waiting for an as yet undefined ‘reasonable period’ of time before responding
regardless of her needs. And when the employer does eventually respond, the answer
could as easily be ‘no’ as ‘yes.’” Further, she asserted: “H.R. 1 provides no resource
for employees whose requests to use their comp time are arbitrarily or unfairly denied.
... there is nothing she can do. This,” she stated, “is not flexibility from any working
woman’s perspective.”
Ms. Norton observed that mandatory overtime is legal under current law and that
“H.R. 1 will not change that. Employers can still require employees to work up to 50,
60, or more hours in a week, without advance notice or regard to employees’ other
obligations. Employees in this situation can hardly be said to have flexibility or choice
about the time they spend at work or at home.” Under H.R. 1, however, those
overtime hours could be paid for in subsequent time off, rather than in cash. Finally,
Ms. Norton suggested that enforcement of federal wage/hour law could, potentially,
be rendered more complex were H.R. 1 enacted. “However,” she stated, “the bill
contains no money for the increased education or enforcement efforts that its changes
will require.”172
Karen Nussbaum of the AFL-CIO also appeared before the Subcommittee on
Worker Protections, reiterating the points that she had made before the Senate
Subcommittee the previous day. (See discussion above.) Although not a part of the
hearing agenda, a statement from the Associated Builders and Contractors, Inc.,
supportive of H.R. 1, was circulated.
The Senate: A Second Hearing. On February 13, 1997, the Senate
Subcommittee on Employment and Training met a second time for consideration of
S. 4. Following a brief review of the legislation, Chairman De Wine variously quoted
statements by President Clinton who appeared to have endorsed flexibility — though
not the specific Ashcroft proposal — and concluded: “I think we have a consensus
here — and that we are very well positioned to make a good faith effort to pass this
legislation in a bipartisan way.”173
172 Statement of Helen L. Norton, Women’s Legal Defense Fund, before the Subcommittee
on Workforce Protections, February 5, 1997.
173 Statement by Senator Michael DeWine, Subcommittee on Employment and Training,
February 13, 1997. President Clinton’s statement in his State of the Union Address was a
broad endorsement of flextime. The President stated:
With new pressures on people in the way they work and live, I believe we must
expand family leave so that workers can take time off for teacher conferences and
a child’s medical checkup. We should pass flex-time, so workers can choose to
be paid for overtime in income or trade it in for time off to be with their families.
See: Clinton, William J. “Address Before a Joint Session of the Congress on the State of the
(continued...)

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The session opened with Senator Ashcroft as the first witness. He was followed
by Paul Jadin, Mayor of Green Bay, Wisconsin, who focused primarily upon the
treatment of salaried employees (the salary basis test) under the FLSA. Similar issues
were addressed by Marilyn Richter, Assistant Corporation Counsel of the City of New
York.174
Support for S. 4 was provided by the employer community. William A. Stone,
president of Louisville Plate Glass Company and speaking for the U.S. Chamber of
Commerce (“the world’s largest business federation”), forecast that “almost all, if not
all, of our employees” will ask to participate in the comp time program if S. 4 is
passed. But, he quickly added: “Of course, it would be not only unwise but
essentially unworkable to allow employees with accrued comp time to use that
accrued time whenever they pleased.” And, further, with the comp time provisions
of S. 4, “there would [be] little or no need for most of the provisions of the Family
and Medical Leave Act (FMLA).”175
Ms. Kathleen Fairall of The Timken Company returned as a witness for the
Society for Human Resource Management (SHRM), being accompanied by Ms.
Sandie Moneypenny, a technician for The Timken Company. Each had testified
before the House Subcommittee on Workforce Protections in 1995. Like othe
176
r
industry witnesses, Mr. Fairall argued that flexibility “is not permitted under the
FLSA” though she acknowledged that “we can be flexible anytime within the seven-
day work week.”
A further appeal for S. 4 was presented by James Willms
177
,
associated with the Unicover Corporation of Cheyenne, Wyoming. Willm
178
s
explained that Unicover employees, back in 1981, had sought a comp time option on
a “one-for-one” basis instead of time-and-a-half in the form of overtime pay. “They
said they wanted more freedom to work most when the Company really needed it, and
(...continued)
173
Union,” February 4, 1997. Weekly Compilation of Presidential Documents. Vol. 33, No.
6. p. 140. In summarizing the Senate Subcommittee hearing, the Daily Labor Report,
February 14, 1997, p. AA1, noted: “The Clinton administration has not endorsed the
Ashcroft bill.”
174 The statements of Mayor Jadin and of Assistant Corporation Counsel Richter are lengthy
and detailed but address issues only tangential to this report and, therefore, are merely noted.
175 Statement, William A. Stone, for the U.S. Chamber of Commerce. February 13, 1997.
176 At the June 8, 1995, hearing before the House Subcommittee on Workforce Protections,
Ms. Fairall had spoken both for SHRM and for the FLECS Coalition. Both in 1995 and here
before the Senate Subcommittee, Ms. Moneypenny spoke as an individual, through her
testimony appeared in each case on Timken letterhead and had the support of The Timken
Company.
177 Statement by Ms. Kathleen Fairall, Subcommittee on Employment and Training. February
13, 1997.
178 It was an appeal from the Unicover Corporation which had inspired Senator Wallop to
introduce comp time legislation during the mid-1980s. The Cheyenne-based firm markets
“fine collectibles throughout North America and ... to about 30 countries from Europe to the
Pacific Rim.” It has about 160 employees.

CRS-48
less when demand was down,” Willms explained. The Department of Labor would
not permit the arrangement and, therefore, Willms urged that the law be changed.179
The final employer witness was Susan M. Eckerly, speaking for the National
Federation of Independent Business (NFIB). “For years,” she commenced, “small
180
business owners have been seeking less regulation in the workplace and more
flexibility regarding how they treat their employees.” Eckerly explained: “..the
burden created by federal regulation falls predominantly and disproportionately on the
very people who we rely upon to create jobs, small business owners.” And, from this
perspective, she stated, the FLSA “has become part of this burden that the federal
government has dumped on the back of small business.” S. 4, she suggested, would
be “more small business friendly.” As with many earlier witnesses, Eckerly pointed
to the age of the statute and noted that times have changed since its enactment. “The
Great Depression has long since vanished and the widespread rates of high
unemployment are an afterthought,” she noted. “The Fair Labor Standards Act is in
desperate need of reform.”181
During discussion following her formal statement, Eckerly emphasized the
financial hardship (and narrow margin of profit) facing small businesses. Some small
employers, she suggested, “can’t afford to pay their employees overtime. This
[flextime] is something they can offer in exchange” that gives workers a benefit.
Say you’re a building contractor. Because of the seasonal nature of building
contractors, you want to have your employees work 30 hours one week and 50
hours the next. You don’t want to have to pay in that second week 10 hours of
additional overtime to your employees ... The reason why a small contractor can’t
on that second week have [employees] work for 50 hours is because they can’t
afford to pay the additional overtime for that 10 additional hours.
Senator Wellstone responded: “We want to make sure that a large or small business
now does not say to an employee, ‘Listen, we have no other choice. We need the 50
hours of work done, and that’s the option we’re presenting to you.’ Then,” the
Senator observed, “people worry they’re going to lose their job if they don’t take
it.”182
179 Statement of James Willms, Subcommittee on Employment and Training. February 13,
1997.
180 Ms. Eckerly explained that the NFIB “is the nation’s largest small business advocacy
organization representing 600,000 small business owners in all 50 states and the District of
Columbia.”
181 Statement of Susan M. Eckerly, Subcommittee on Employment and Training. February
13, 1997.
182 Congress Daily, February 19, 1997. <cngdaily@njdc.com>. Following the hearing,
Senator Ashcroft wrote to NFIB President Jack Faris to protest what he argued was a
“mischaracterization” of S. 4. Ms. Eckerly, Congress Daily observed, had “implied the bill
would allow company managers — not employees — to set an employee’s 80-hour schedule
over two weeks, and would help small businesses that cannot afford to pay overtime.”
Senator Ashcroft termed the Eckerly statement “unfortunately misleading and inaccurate.”
(continued...)

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As in prior hearings, the Women’s Legal Defense Fund opposed S. 4 and similar
amendment of the FLSA. Donna Lenhoff, general counsel for the Fund, declared that
S. 4 was “not about the real flexibility that working women need. ... Instead, it gives
employees less control over their time and their paychecks, creating new risks and
problems.” It “does not give employees a true choice between extra time off and
overtime pay.”183
David M. Silberman, a labor lawyer but speaking only on his own behalf,
similarly raised objections to S. 4 — but presented them in a somewhat different
manner. Quickly summarizing the requirements of the Act (overtime after 40 hours
of work per week), he noted:
Within this limitation the Act leaves employers and employees complete leeway to
work out mutually satisfactory work schedules. And there is absolutely nothing
in the FLSA which in any way constrains the ability of employers to accommodate
employees who need time off by granting such employees paid, or unpaid, leave.
S. 4, he suggested, would be “a sharp break with this long-settled system of overtime
compensation” and the 40-hour week would “no longer necessarily be the benchmark
for determining an employee’s entitlement to overtime pay.” The pre-overtime
workweek, under S. 4, he argued, could be “50, 60, or even 70 hours ... so long as
over two weeks the employee did not work more than 80 hours.” And, if hours in
excess of 80 were worked, they could be compensated for with comp time or with
“flexible credit hours.”
Silberman, acknowledging the “stated purpose of these provisions” of S. 4,
affirmed: “... important questions have been raised as to whether, in practice, in the
run of private sector workplaces, it is possible to create new and voluntary scheduling
options for employees, as the bill’s statement of purposes declares.” The argument
came down to perspective: i.e., how one might view the relative power position of
workers and their employers.
Regardless of what the law says, will employees — and especially the large
number of low-wage and contingent workers who are in most need of the law’s
protections — in fact feel free to insist on overtime pay after working 40 hours if
their employer makes plain his preference to use a biweekly work schedule or to
provide comp. time for flexible credit hours instead?
Further, Silberman asked:
Will an employee who has earned comp. time or a flexible credit hour feel
constrained to use the time off when it is convenient for the employer for her to
miss work, or will the employee actually feel free to use that time when it suits her
family’s needs? And will an employee whose rights are violated feel able to stand
up to her employer?
(...continued)
182
Congress Daily, February 21, 1997. <cngdaily@njdc.com>.
183 Statement, Donna R. Lenhoff, Subcommittee on Employment and Training, February 13,
1997.

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Silberman noted that, under S. 4 and H.R. 1, an employee might be allowed to receive
comp time in place of overtime. Were that to happen, as provided for in the
legislation, “the employee will end up in essentially the same position as if she had
been paid for the overtime hours and then took unpaid leave to meet her family’s
needs. That, of course,” he pointed out, “is lawful today.”
Like Ms. Lenhoff of the Women’s Legal Defense Fund, Silberman argued that
the legislation would not actually provide workers with free choice. He said that the
entire program was structured to provide choice to the employer. Nothing in the
legislation, he affirmed, would “assure that employees who prefer premium pay are
not disfavored by the employer when it comes to awarding overtime assignments.”
And in the absence of such assurance, comp time could be the only option, he
suggested, because regular overtime could quickly become unavailable. He observed:
“An employer could, without violating the law, hire only those applicants willing to
work overtime without premium pay, and/or award overtime only to those employees
willing to accept an IOU for time off in return.”184
Concluding Comment
Allowing for variations among individuals (and between historical periods),
workers have tended to favor legislated labor standards requirements (minimum
wages, overtime pay, restraints upon child labor, workplace safety, etc.). Conversely,
employers have tended to favor a system less restrained by public enactments. That
division, in some measure, was reflected in the debate about H.R. 1 and S. 4.
Labor standards regulation, whether by the federal government or by the states,
speaking generally, has not been welcomed by employers. Some have viewed such
regulation as a violation of the spirit of the free market; others, as a restraint upon the
ability of employers to manage their own businesses. However justified in terms of
worker protection, some have argued that the establishment of high labor standards
within the United States may impair industry’s ability to compete in a global
marketplace. Still others, especially from the small business community, contend that
many employers cannot afford to pay minimum wages and overtime rates and still
make a profit.
Employee perspectives toward labor standards have varied through the years —
depending upon the experience of individual workers, general economic conditions,
and distance from the adverse conditions that caused such standards to be legislated.
Some workers are anxious to work overtime hours (with overtime pay). Others, for
their own reasons, would prefer to have more free time away from work, even with
a slight loss of income.
Over the years, memories may have dimmed with respect to the conditions under
which workers toiled late in the 19th century and through the early decades of the 20th
century. As the Great Depression has become part of historical memory (as opposed
184 Statement of David M. Silberman, Subcommittee on Employment and Training. February
13, 1997.

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to personal memory), attitudes have tended to change. Some point to positive
developments in the area of labor standards and labor-management relations during
recent decades and suggest that it is anachronistic for the rules governing the
workplace to be rooted in 1930s experience and enactments. Conversely, others
185
argue that the basic protections and safeguards provided by New Deal era labor laws
(including the Fair Labor Standards Act) are the bases of these post-Depression
workplace improvements and that, without them, conditions would likely regress.
Changing workforce demographics may have brought new perspectives about
work and labor-management relations. They may also have produced new lifestyle
realities for workers: how they live, what they value, what they need, what is required
of them.
In a June 1996 directive to the federal executive departments and agencies,
President Clinton expressed his belief that establishment of a family friendly
environment (including flexible work arrangements) results in “greater cost efficiency,
increased worker commitment and productivity, [and] better customer service...”186
Journalist Tim Shorrock pointed to similar beliefs in a recent Journal of Commerce
article. “Many U.S. manufacturing and transportation companies believe the [family
friendly workplace] proposals could boost their productivity and improve the nation’s
competitive position in global trade.”187
Congress will face a number of questions as it considers modification of the 40-
hour workweek and relaxation, through a series of devices, of the overtime pay
requirements of the FLSA. Workhours regulation (shorter workdays and weeks) was
appropriate early in the century, Congress believed, on grounds of worker health and
safety, accident prevention, unemployment reduction, and diverse humane
185 Congressional Record, August 7, 1995. p. S11788.
186 Clinton, William J. “Memorandum on Family Friendly Work Arrangements,” June 21
1996. Weekly Compilation of Presidential Documents, Vol. 32, No. 26. p. 1119.
187 Shorrock, Tim. “US Firms Prepare To Square Off with Labor on Work Laws,” Journal
of Commerce, December 24, 1996. p. 1A.
The extent to which such policies would actually enhance productivity or
competitiveness has not been fully demonstrated and likely would vary from one workplace
to another. Ellen C. Bankert and Bradley K. Googins, in an article, “Family-Friendly: Says
Who?” Across The Board, July-August 1996, p. 49, conclude:
“Succumbing to the temptation for the quick fix has resulted in a loosely defined
and narrowly conceived set of benefits that have become a new corporate darling
in this age of family values. However useful they are to some, if these benefits
become frozen into a simplistic response to very complex problems, they will not
only miss the mark of enhancing employee effectiveness at work, they will miss an
even greater opportunity for improving the overall quality of life at home and at
work.”
See also: Rainey, Glenn W., Jr., and Lawrence Wolf. “Flex-Time: Short-Term Benefits;
Long-Term...?” Public Administration Review, January-February 1981. p. 52-63; and,
Palmer, Barbara. “The 10-to-3 Ethic: Why There’s No Labor at the Department of Labor.”
The Washington Monthly, January 1981. p. 35-42.

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considerations — as well as providing encouragement for sharing the available work.
Some argue that new workplace realities have reenforced that need for such
regulation. Workplace hazards remain, though their nature may have changed. New
processes and advanced technology may even have exaggerated the risks. There is
still competition for work, especially among hourly-paid workers most directly
affected by the protections afforded by the FLSA.
Conversely, the workforce itself has changed through the years. Women are
more represented throughout the workforce and professions than may have been the
case early in the century. While some women always worked outside the home even
after marriage and the birth of children, that practice is now more the norm. To that
extent, the tensions between domestic life and employment may have escalated. As
a result, some have projected a need for increased flexibility in hours of work, both
for women and men. For others, it may be predictability that is needed.
Meanwhile, U.S. businesses, especially smaller businesses, may feel more
competition today than in recent history, especially from foreign firms and in the new
global marketplace. From their vantage point, securing relief from some requirements
of the FLSA holds the possibility, if not the promise, of higher productivity at lower
costs. Thus, an easing of workhours regulation, in their view, presents a win-win
situation: rationalization of production in a manner so that overtime would not be
necessary, reducing costs and, at the same time, providing an option for workers more
effectively to manage the dual responsibilities of work and family.188
While S. 4 and H.R. 1 (and related legislation) have been presented as worker
and family friendly, the hearings on this legislation revealed strong worker concerns
about proposals to change the 40-hour workweek and modify overtime pay
requirements. A large part of this dichotomy relates to choice. Initiation of the comp
time/flexible scheduling options would rest with employers — as would the
determination as to when banked hours could be used without unreasonably
disrupting work processes. These essential flexible workhours choices rest with
employers as, some would argue, they must if a business is to be run with efficiency
and be profitable. However, those concerned mainly with protection for workers fear
that the current proposals provide flexibility for employers but only uncertainty or
unpredictability for employees. Thus, they suggest, the position of the individual
worker may be rendered more difficult: diminishing, not increasing, his or her ability
to deal with family concerns while reducing the family income through elimination of
overtime pay.
Industry-oriented witnesses, arguing for more worker flexibility and choice, have
pointed to the putative inflexibility of the overtime requirements of the FLSA.
Worker-oriented witnesses, conversely, have affirmed that existing law provides
adequate flexibility but with statutory safeguards against employer abuse. Flexible
scheduling, even where now permitted, appears to have developed slowly in American
workplaces. Mark Wilson of The Heritage Foundation, for example, testified: “...it
is disturbing that after nearly 20 years since flex-time was first introduced in the U.S.,
188 Ashcroft, John. “Time or Money vs. Time and Money: A Prescription for Worker Relief,”
Common Sense. Summer 1996. p. 115-128.

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only 15.3 percent of all private full-time employees” are working on flexible
schedules.189
As wage/hour standards under the FLSA are currently structured, they are
complex and difficult to enforce, given the relatively small staff of DOL’s Wage and
Hour Division. Even so, the 40-hour workweek is, by and large, a relatively straight-
forward concept and not too difficult to understand. Some have voiced concern
about the affect of the proposed legislation on compliance. The more variations there
are from a rigid norm, they suggest, the greater the flexibility is likely to be; but, at the
same time, such variations may well increase the burden of compliance and
enforcement, both for Department of Labor and for employers.190
Proponents of the alternative work scheduling legislation, however, suggest that
a restructured system would create no larger problems for enforcement than exist
under current law. And, at the same time, the benefits both for employers and for
workers may outweigh any added administrative problems
189 Statement, Mark Wilson, Subcommittee on Employment and Training, February 4, 1997.
See interview with Suzanne Seiden, acting deputy administrator, Wage and Hour Division,
Department of Labor, in Daily Labor Report, March 5, 1997. P. A8-A9.
190 Each variation from a standard, each element of worker or employer protection, will
require regulations from the Secretary of Labor for implementation and enforcement. It is not
clear how cumbersome these regulations might be. In some settings, the burden may not be
great; in others (and, perhaps, especially for small businesses), it could be substantial.