A Multnomah County Circuit Judge has ruled that, contrary to the Oregon Bureau of Labor and Industries’ (BOLI) recent interpretation of the overtime rules, employees working in mills, factories, and manufacturing establishments are entitled only to the greater of daily or weekly overtime pay in a workweek, not both. This means, for now, you can continue paying affected employees the greater of the daily or weekly overtime owed.
Coverage: Manufacturing employers with employees in Oregon.
Effective: Immediate.
Action Required: BOLI’s historic interpretation of the overtime rules for manufacturing employees remains in effect. You should review your overtime calculation practices to determine if changes are necessary and immediately notify your Payroll Service Representative to ensure that you are paying affected employees the greater of the daily or weekly overtime.
Historically, the Oregon Bureau of Labor and Industries’ (BOLI) has taken the position that “when employees who are entitled to daily overtime have worked more than 40 hours in the workweek and have also exceeded the maximum number of hours on one or more days, thereby earning daily overtime, the employer should calculate overtime hours worked on both the daily and weekly bases and pay the greater amount”. Recently, we notified you of the agency’s significant reinterpretation of these rules to require that affected employees be paid both the daily and weekly overtime, resulting in the payment of double overtime. Shortly after our publication, an Oregon court issued a ruling that took exception to the agency’s reinterpretation.
On March 9, 2017, Multnomah County Circuit Judge Kathleen Dailey issued a ruling in which she held that manufacturing employees are entitled only to the greater of daily or weekly overtime pay in a workweek, not both. Judge Dailey’s decision is expected to be appealed. Until such time as it is appealed; however, you can continue or begin paying your manufacturing employees the greater of the daily or weekly overtime owed. We will provide further updates as the resolution to this matter progresses.
As always, please contact your H R Business Partner if you have any questions.