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Before the FLSA and COBRA laws were passed, there were many employers who were taking advantage of their workforce in several ways.
It was not uncommon to call an employee exempt who really did not qualify for an exempt status. The company would do this for the purpose of avoiding overtime pay. At the same time, the same employers were docking their workers if they called out sick or had to take time off for personal or doctor appointments. Essentially the workers were providing many hours of free labor but not being compensated with the ability to call out sick or go to appointments without a financial punishment. The employers practicing this method of supervision were getting the best of both worlds while the employees were getting the worst of both worlds.
Once the FLSA laws went into effect there was an immediate and significant changes across the nation in the way employees were classified from the beginning and this made it a significant change from the way things had been done before the law went into affect.
Today the law is still effective but because of its existence, most companies in the U.S. already comply from the moment the employee is hired therefore the impact is less significant.
The COBRA laws are still every bit as effective today, as they were when first mandated if not more so. This is due to the rising cost of health care and the public mandate to reduce those costs.
If I were to make recommendations to update and improve the laws I would do one thing for each law.
When an employee loses his or her position within a company one of the largest worries that the employee has involve finances. While I understand...
I would keep the same time frames in place for coverage but would have the company pay half of the premium to help the employee maintain coverage even during a financial event such as being unemployed.
With regard to the FLSA laws I would only make one change for improvement. I would not allow any exemptions at all. If the employee was paid a salary more than $455 a week that employee would be classified exempt. If the employee made less he or she would automatically be non-exempt. There would be no exceptions to that rule in any category. In addition there would be no exception to the rule about calling out sick or other missed days. A salaried employee would not be docked for any reason for time off. If the salaried employee took advantage of that policy they would be terminated however, I would make the exceptions be written into the law for the purpose of protecting all parties involved.
References
____(2005) 14 Pointers to Help You Understand the Essentials of COBRA. IOMA's Report on Managing Benefit Plans.
____(2004) FLSA Interpreting the Rules of Change.. IOMA's Report on Managing Benefit Plans.
Bikoff, Laura (2004) 2004 COBRA Survey, Fewer Were Eligible, More Elected. Employee Benefit Plan Review 2004. pg 10
Bonnecaze, Randy (2005) Fair Labor Standards. Louisiana Contractor Vol 54 pp 39
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