New Department of Labor regulations, set to kick in December 1, will make companies pay time and a half to salaried employees who earn less than $47,500 annually when they work more than 40 hours per week, and publishers appear ready to limit hours rather than pay overtime.
Of the 241 senior managers who responded to PW’s annual salary and job survey, 48% said they will make sure that employees earning less than $47,500 annually do not work more than 40 hours per week. The second-most-favored option, cited by 32% of managers, is to pay the overtime. Few managers said they expect to take more drastic measures: 4% said they will replace full-time employees with part-time workers, and only 1% said they will eliminate positions to avoid paying the higher costs.
As with the current regulation, which requires employers to pay overtime to salaried employees earning under $23,600 who work more than 40 hours per week, not all salaried employees who earn less than the salary threshold will qualify for overtime. Companies are able to exempt employees from overtime through the use of various criteria, such as a duties test, which looks at, among other things, how much discretion an employee has to set his or her own hours. In publishing, this could mean that editors who have been told they need to complete a report on a manuscript by a certain deadline will qualify for overtime, but editors who read a galley only because it seems interesting will not be eligible. There can be a fine line between who is exempt and who is not, a human resources executive said.
The 104 respondents to the PW survey who earn less than $47,500 are somewhat unsure how the new regulations will affect them: 32% said they don’t expect to benefit from the change, and another 31% said they don’t know what the impact the will be. (Roughly 37% of respondents earning less than $47,500 said they work more than 40 hours per week.)
Whether the regulations will have teeth is another question. Whereas almost half (47%) of respondents affected by the regulation said they don’t expect to feel pressure to work extra hours without claiming overtime, 38% said they do think they will be pressured to work extra hours without extra pay.
Employees in editorial positions were the largest share of those who said they think they will benefit from the new regulations, as well as the largest share of those who said they expect to feel pressure to work overtime without additional compensation. Thirty-eight percent said they think they will benefit from the new regulations (another 38% said they didn’t know whether they would benefit). An even higher percentage (44%), however, said they think they will be expected to work more than 40 hours without overtime pay.
The president of a midsize publisher said his company has no editorial employees who earn less than $47,500, though two marketing assistants at the company make less than that; the human resources department has already been told to limit these assistants’ hours to no more than 40 hours per week. Steven Piersanti, president of Berrett-Koehler Publishers, also said his company has no editorial employees earning less than $47,500. The company has a few employees in other departments who don’t reach the threshold, and when they exceed 40 hours (which is not often), they are paid overtime, Piersanti said. Most of those employees, he added, are eligible to be promoted, and if they are they will earn more than $47,500.
A representative from another publisher speculated that many companies who have employees close to the new threshold will make salary adjustments. Spokespersons for Penguin Random House and Hachette Book Group both said their companies will continue to adhere to the Department of Labor guidelines. The HBG spokesperson added that the only thing that will change is “the number of people who are now eligible for overtime.”
How Publishers Will Comply with New Overtime Regulations
|Limit hours for employees||48%|
|Pay the mandated overtime||32%|
|Raise employee salaries above the threshold to make them exempt from overtime pay||8%|
|Replace full-time employees with part timers||4%|
|Eliminate positions to pay for higher costs||1%|
Source: PW Annual Salary and Jobs Survey