FLSA Working Hours Reform: Worker Well-Being Effects in an Economic Framework

Abstract

A model is developed to predict the effects of recently proposed amendments to the FLSA workweek and overtime provisions. It contrasts allowing compensatory time for overtime pay for private non-exempt employees to “rights to request” reduced hours. It finds that hours demanded are likely to rise for the workers who request comp time, undermining its intention of family-friendliness and alleviating overemployment — unless it were accompanied by offsetting policies that prevent the denied use or forced use of comp time and resurrect some monetary deterrent effect. A unique survey shows that the preference for comp time is far more prevalent among exempts, thus, worker welfare is likely better served if comp time in lieu were incorporated into the right to request.