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White Castle testifies on federal labor law

Published: June 10, 2015
The federal Fair and Labor Standards Act (FLSA) should be modernized, White Castle vice president Jamie Richardson told a congressional panel today. Richardson testified before a hearing of the House Education and Workforce Committee’s Subcommittee on Workforce Protections, which was examining federal labor law prior to the Obama administration’s anticipated revisions to overtime rules.

“While few significant modifications have been made to the FLSA in recent years, there has been a major shift in the industries that drive employment opportunities, technology has transformed the workplace and job duties, and employees increasingly place a premium on workplace flexibility,” Richardson said. “The result is an outdated and complex framework in which employers and employees must operate, and the need to modernize a 1930s Depression-era law for the 21st-century economy has never been more important.”

President Obama issued an executive order to the Secretary of Labor in March 2014 to update regulations regarding overtime exemptions, citing the erosion of the 40-hour work week and the failure to update salaries to keep current with inflation. A proposal of changes has not yet been presented.

White Castle testified on behalf of the National Council of Chain Restaurants and the National Retail Federation, which have been critical of the administration’s plans to alter federal overtime rules. An Oxford Economics study commissioned by the NRF found that even a modest change to the overtime salary threshold would affect millions of workers and cost restaurant and retail businesses more than $5 billion.

Richardson said modifying federal overtime rules “would curb a manager’s critical ability to multitask in a busy restaurant setting, undermine customer service, limit training opportunities for team members, diminish morale and force complicated assessments of time spent managing in a restaurant setting,” adding that the career advancement of hourly employees would be curtailed.

The Fair Labor Standards Act (FLSA) was created in 1938 to establish a minimum wage and a limit on the number of hours which may be worked in a standard work week. It also provides standards for equal pay, overtime pay, record-keeping and child labor.