AN
ACT Relating to overtime compensation for commissioned salespersons; amending
RCW 49.46.130 and 49.46.010; adding a new section to chapter 49.46 RCW;
creating a new section; and declaring an emergency.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
*NEW
SECTION. Sec. 1.
A new section is added to chapter 49.46 RCW to read as follows:
Section
3, chapter 289, Laws of 1975 1st ex. sess., codified as RCW 49.46.130, was
adopted for the purpose of creating conformity between state overtime pay
standards and the federal fair labor standards act. RCW 49.46.130(2)(h) was
intended to incorporate alternative federal premium guarantee standards for
retail commissioned salespersons, found at 29 U.S.C. 207(i), into the state
wage and hour law.
The
legislature finds that retail sales typically peak during holiday seasons and
events such as product promotions and new product arrivals. Retail
commissioned salespersons can maximize their incomes, and are therefore most
benefited, by maximizing the hours they work during periods when the sales per
hour ratio is high. Employment policies that penalize employers for working
retail commissioned salespersons more than forty hours in a peak sales work
week are detrimental to the well-being of Washington's retail commissioned
salespersons.
*Sec. 1 was vetoed. See message at end of chapter.
Sec.
2. RCW
49.46.130 and 1995 c 5 s 1 are each amended to read as follows:
(1)
Except as otherwise provided in this section, no employer shall employ any of
his employees for a work week longer than forty hours unless such employee
receives compensation for his employment in excess of the hours above specified
at a rate not less than one and one-half times the regular rate at which he is
employed.
(2)
This section does not apply to:
(a)
Any person exempted pursuant to RCW 49.46.010(5). The payment of compensation
or provision of compensatory time off in addition to a salary shall not be a
factor in determining whether a person is exempted under RCW 49.46.010(5)(c);
(b)
Employees who request compensating time off in lieu of overtime pay;
(c)
Any individual employed as a seaman whether or not the seaman is employed on a
vessel other than an American vessel;
(d)
Seasonal employees who are employed at concessions and recreational
establishments at agricultural fairs, including those seasonal employees
employed by agricultural fairs, within the state provided that the period of
employment for any seasonal employee at any or all agricultural fairs does not
exceed fourteen working days a year;
(e)
Any individual employed as a motion picture projectionist if that employee is
covered by a contract or collective bargaining agreement which regulates hours
of work and overtime pay;
(f)
An individual employed as a truck or bus driver who is subject to the
provisions of the Federal Motor Carrier Act (49 U.S.C. Sec. 3101 et seq. and 49
U.S.C. Sec. 10101 et seq.), if the compensation system under which the truck or
bus driver is paid includes overtime pay, reasonably equivalent to that
required by this subsection, for working longer than forty hours per week;
(g)
Any individual employed (i) on a farm, in the employ of any person, in
connection with the cultivation of the soil, or in connection with raising or
harvesting any agricultural or horticultural commodity, including raising,
shearing, feeding, caring for, training, and management of livestock, bees,
poultry, and furbearing animals and wildlife, or in the employ of the owner or
tenant or other operator of a farm in connection with the operation,
management, conservation, improvement, or maintenance of such farm and its
tools and equipment; or (ii) in packing, packaging, grading, storing or
delivering to storage, or to market or to a carrier for transportation to
market, any agricultural or horticultural commodity; or (iii) commercial
canning, commercial freezing, or any other commercial processing, or with
respect to services performed in connection with the cultivation, raising,
harvesting, and processing of oysters or in connection with any agricultural or
horticultural commodity after its delivery to a terminal market for
distribution for consumption;
(h)
Any industry in which federal law provides for an overtime payment based on a
work week other than forty hours. However, the provisions of the federal law
regarding overtime payment based on a work week other than forty hours shall
nevertheless apply to employees covered by this section without regard to the
existence of actual federal jurisdiction over the industrial activity of the
particular employer within this state. For the purposes of this subsection,
"industry" means a trade, business, industry, or other activity, or
branch, or group thereof, in which individuals are gainfully employed (section
3(h) of the Fair Labor Standards Act of 1938, as amended (Public Law 93-259).
(3)
No employer shall be deemed to have violated subsection (1) of this section
by employing any employee of a retail or service establishment for a work week
in excess of the applicable work week specified in subsection (1) of this
section if:
(a)
The regular rate of pay of the employee is in excess of one and one-half times
the minimum hourly rate required under RCW 49.46.020; and
(b)
More than half of the employee's compensation for a representative period, of
not less than one month, represents commissions on goods or services.
In
determining the proportion of compensation representing commissions, all
earnings resulting from the application of a bona fide commission rate is to be
deemed commissions on goods or services without regard to whether the computed
commissions exceed the draw or guarantee.
(4)
No employer of commissioned salespeople primarily engaged in the business of
selling automobiles, trucks, recreational vessels, recreational vessel
trailers, recreational vehicle trailers, recreational campers, or manufactured
housing to ultimate purchasers shall violate subsection (1) of this section
with respect to such commissioned salespeople if the commissioned salespeople
are paid the greater of:
(a)
Compensation at the hourly rate, which may not be less than the rate required
under RCW 49.46.020, for each hour worked up to forty hours per week, and
compensation of one and one-half times that hourly rate for all hours worked
over forty hours in one week; or
(b)
A straight commission, a salary plus commission, or a salary plus bonus applied
to gross salary.
(((4)))
(5) No public agency shall be deemed to have violated subsection (1) of
this section with respect to the employment of any employee in fire protection
activities or any employee in law enforcement activities (including security
personnel in correctional institutions) if: (a) In a work period of
twenty-eight consecutive days the employee receives for tours of duty which in
the aggregate exceed two hundred forty hours; or (b) in the case of such an
employee to whom a work period of at least seven but less than twenty-eight
days applies, in his or her work period the employee receives for tours of duty
which in the aggregate exceed a number of hours which bears the same ratio to
the number of consecutive days in his or her work period as two hundred forty
hours bears to twenty-eight days; compensation at a rate not less than one and
one-half times the regular rate at which he or she is employed.
Sec.
3. RCW
49.46.010 and 1993 c 281 s 56 are each amended to read as follows:
As
used in this chapter:
(1)
"Director" means the director of labor and industries;
(2)
"Wage" means compensation due to an employee by reason of employment,
payable in legal tender of the United States or checks on banks convertible
into cash on demand at full face value, subject to such deductions, charges, or
allowances as may be permitted by rules of the director;
(3)
"Employ" includes to permit to work;
(4)
"Employer" includes any individual, partnership, association,
corporation, business trust, or any person or group of persons acting directly
or indirectly in the interest of an employer in relation to an employee;
(5)
"Employee" includes any individual employed by an employer but shall
not include:
(a)
Any individual (i) employed as a hand harvest laborer and paid on a piece rate
basis in an operation which has been, and is generally and customarily
recognized as having been, paid on a piece rate basis in the region of
employment; (ii) who commutes daily from his or her permanent residence to the
farm on which he or she is employed; and (iii) who has been employed in
agriculture less than thirteen weeks during the preceding calendar year;
(b)
Any individual employed in casual labor in or about a private home, unless
performed in the course of the employer's trade, business, or profession;
(c)
Any individual employed in a bona fide executive, administrative, or
professional capacity or in the capacity of outside salesman as those terms are
defined and delimited by rules of the director. However, those terms shall be
defined and delimited by the Washington personnel resources board pursuant to
chapter 41.06 RCW;
(d)
Any individual engaged in the activities of an educational, charitable,
religious, state or local governmental body or agency, or nonprofit
organization where the employer-employee relationship does not in fact exist or
where the services are rendered to such organizations gratuitously. If the
individual receives reimbursement in lieu of compensation for normally incurred
out-of-pocket expenses or receives a nominal amount of compensation per unit of
voluntary service rendered, an employer-employee relationship is deemed not to
exist for the purpose of this section or for purposes of membership or
qualification in any state, local government or publicly supported retirement
system other than that provided under chapter 41.24 RCW;
(e)
Any individual employed full time by any state or local governmental body or
agency who provides voluntary services but only with regard to the provision of
the voluntary services. The voluntary services and any compensation therefor
shall not affect or add to qualification, entitlement or benefit rights under
any state, local government, or publicly supported retirement system other than
that provided under chapter 41.24 RCW;
(f)
Any newspaper vendor or carrier;
(g)
Any carrier subject to regulation by Part 1 of the Interstate Commerce Act;
(h)
Any individual engaged in forest protection and fire prevention activities;
(i)
Any individual employed by any charitable institution charged with child care
responsibilities engaged primarily in the development of character or
citizenship or promoting health or physical fitness or providing or sponsoring
recreational opportunities or facilities for young people or members of the
armed forces of the United States;
(j)
Any individual whose duties require that he or she reside or sleep at the place
of his or her employment or who otherwise spends a substantial portion of his
or her work time subject to call, and not engaged in the performance of active
duties;
(k)
Any resident, inmate, or patient of a state, county, or municipal correctional,
detention, treatment or rehabilitative institution;
(l)
Any individual who holds a public elective or appointive office of the state,
any county, city, town, municipal corporation or quasi municipal corporation,
political subdivision, or any instrumentality thereof, or any employee of the
state legislature;
(m)
All vessel operating crews of the Washington state ferries operated by the
department of transportation;
(n)
Any individual employed as a seaman on a vessel other than an American vessel((.));
(6)
"Occupation" means any occupation, service, trade, business,
industry, or branch or group of industries or employment or class of employment
in which employees are gainfully employed;
(7)
"Retail or service establishment" means an establishment seventy-five
percent of whose annual dollar volume of sales of goods or services, or both,
is not for resale and is recognized as retail sales or services in the
particular industry.
NEW
SECTION. Sec. 4.
Nothing in this act shall be construed to alter the terms, conditions, or
practices contained in any collective bargaining agreement in effect at the
time of the effective date of this act until the expiration date of such
agreement.
*NEW
SECTION. Sec. 5.
This act is necessary for the immediate preservation of the public peace,
health, or safety, or support of the state government and its existing public
institutions, and takes effect immediately.
*Sec. 5 was vetoed. See message at end of chapter.
