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ASTA is attempting to have travel agencies removed from a “blacklist” issued by the U.S. Department of Labor decades ago that prevents agencies from being exempt from overtime rules.
The department last month announced its final rule updating overtime regulations. That rule sets a new standard salary level, which is used to determine which salaried workers are eligible for overtime pay (time-and-a-half) if they work more than 40 hours per week.
When the final rule becomes effective, most salaried workers that make $47,476 or less annually must receive overtime pay. The rule also includes a provision to update that salary level every three years. The previous standard salary level, $23,660, was set in 2004.
Eben Peck, ASTA’s senior vice president of government and industry affairs, said the society’s most recent labor study was conducted in 2014 and showed agents have an average salary of $38,000 per year.
ASTA has objected to the new overtime rule, and the time frame in which businesses must comply; the rule is effective Dec. 1.
“Given what the current average is, we have a serious issue that needs to be addressed by our members,” said ASTA general counsel Peter Lobasso.
However, ASTA is hopeful that travel agencies can be removed from a list currently keeping them from being exempt from the overtime rule.
The exemption is for employees who work in retail or service establishment, Peck said. There are several criteria to be established as retail or service establishment. The establishment must sell goods or services; 75% of sales must be recognized as retail in the business’ particular industry; and only 25% of sales may be sales for resale.
“In 1970 the Department of Labor put out a list of industries that can never be considered retail we call this the ‘blacklist’ and unfortunately, in 1970, travel agencies found themselves on that list,” Peck said.
To Peck and Lobasso’s knowledge, the list of establishments that Labor says lack a “retail concept” has not been changed since it was first published.
Peck and Lobasso are in talks with the department about the removal of travel agencies from the list. Peck said that is the first step. Should that fail, step two would be to ask Congress to consider the request.
“This will provide some relief from the new overtime rules for some agency employees,” Peck said.
Meanwhile, ASTA is making a push to educate members on the overtime rules as they stand. Peck said some agencies have indicated the rules only affect one or two employees in their employ. Others, though, have said, “This is going to be a big problem,” he said.
A webinar on the topic is set for July 27 at 2 p.m., and ASTA is planning an educational seminar during its global convention in September.
Source: travelweekly.com
