# Overtime pay-executive order



## skewed

Interested to hear from our community around here. I am sure this will affect quite a few of us working in the industry.

Personally, a few years ago I left salary due to the long hours. I am a single parent with two fairly young kids. I just can't put in super long days. Now with my kids getting older and this increase in the minimum salary cap for overtime pay, salary is looking more appealing.

Thoughts?


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## Bfitts

I was glad to hear about it. Doesn't matter much for me personally, but I was hoping my sous chefs would see some benefit, since they fall under the cap. I'm sure most owners are just trying to find loopholes to screw people out of fair pay. The margins are so thin for restaurants I understand it's hard to overcome.


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## Chuckles

I'll have to look at the details of this but I would imagine many salaried positions will just become hourly and most likely make less money. If I need 200 hrs worked for a set budget I would just have to spread it between 5 hourly people instead of 4 salaried. Unless I am missing something it seems like easy math.


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## rami_m

Chuckles said:


> I'll have to look at the details of this but I would imagine many salaried positions will just become hourly and most likely make less money. If I need 200 hrs worked for a set budget I would just have to spread it between 5 hourly people instead of 4 salaried. Unless I am missing something it seems like easy math.



Labour market demands. I am not sure if you will be able to find 5 good hourly people. I spoken to few chefs in Oz and they have trouble finding good labour. Not sure about the US.


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## daveb

If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501.

Any more is for another forum.


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## Bill13

daveb said:


> If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501.
> 
> Any more is for another forum.



lus1:lus1:lus1:


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## jacko9

daveb said:


> If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501.
> 
> Any more is for another forum.



Your correct about the topic being for another forum but, what I learned in Econ (and from my parents and grandparents) was that before "FDR and his Govn't plans" a whole lot of ordinary people were starving in the streets.

I won't take this any further but to the OP - I think it is a good thing.


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## chiffonodd

daveb said:


> If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501.
> 
> Any more is for another forum.



Must've been at Trump University


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## jacko9

chiffonodd said:


> Must've been at Trump University



+++1


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## brainsausage

Pretty sure there's a strict no politics rule around these parts.


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## jacko9

Then they should close this thread.


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## rami_m

Now where is that popcorn emoji?


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## jacko9

If you want further discussion on this topic go to Yabberz.com and have an open dialog.


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## brainsausage

jacko9 said:


> Then they should close this thread.



Or you should stop posting politically slanted posts. The thread in and of itself is not strictly political in nature.


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## jacko9

brainsausage said:


> Or you should stop posting politically slanted posts. The thread in and of itself is not strictly political in nature.



"If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501." is political in case you missed it! Econ is not a science - it is politics! I was responding to that post. The Reagan era statement that the Government is not the solution but the problem is the issue expressed by the Econ major expressing government "effing" things up!


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## brainsausage

jacko9 said:


> "If the Govt effs with it, it gets eff'd up. All I remember from Econ 101, 201, 301, 401, 501." is political in case you missed it! Econ is not a science - it is politics!



My intent wasn't to single you out. I was merely replying to your reply. Dave, Chiffonod, and you my friend, could all have chosen a different path. My original post was meant to address all of those previous posts.


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## skewed

I didn't mean to delve into a political discussion.

Just a quick question: do some people enjoy or desire to work 50+ hours a week? I truly love to cook but I would rather put in 40/week (as long as it pays the bills). $35k/year working 50hrs/wk is still only ~$13.50 an hour.

I am just very curious to see how this plays out come December 1st.


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## skewed

Chuckles said:


> I'll have to look at the details of this but I would imagine many salaried positions will just become hourly and most likely make less money. If I need 200 hrs worked for a set budget I would just have to spread it between 5 hourly people instead of 4 salaried. Unless I am missing something it seems like easy math.



Quite possibly the case but I am curious how employees will respond to the cut in pay when moving to hourly wages. In your case of 4 employees becoming 5 within the same budget, either way it works out to the exact same pay per hour. When adding an employee an employer has extra expenses in the form of payroll costs/insurance... An employee who wants/needs the additional pay will have to pick up a second job to make up for the 10 hours of lost wages.

Also, the flexibility of having salaried employees is very valuable.

Just pondering a few things.


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## fujiyama

This is good for the people. Not so much for small businesses. 



skewed said:


> I am curious how employees will respond to the cut in pay when moving to hourly wages.



In relation to this topic; I'm under the impression that the minimum wages are going to see a change soon. Seattle's minimum wage will be (is) $15 an hour. California and New York City are in the midst of raising minimum wage to $15 an hour, but it will take a few years to reach that. Other states will follow. 

In Canada we are also heading for a $15 minimum wage (re: Alberta). 

Salary employees can be valuable with their flexibility, however, no one should be taken advantage of. I bet some employers will raise salaries_ just_ above the $47,476 so they won't have to pay overtime. This isn't a bad thing either unless you already make nearly that much on salary, everyone likes a raise (except the employer).


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## strumke

There is a plan out there for DC too which would bring the minimum wage to $15/hr for both tipped and non-tipped workers (over the course of a few years). Is this something that is going to replace tips, lower tips, raise dining prices? I don't work in the industry, but I eat and drink in it a lot. If staff are being paid $15/hr does that effectively eliminate the need to tip? I'm assuming the food prices are going to go up as a result since the money has to come from the employer. If the consumer gets hit with higher dining costs and still tips 20%, dining out will get incrementally more expensive.


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## Keith Sinclair

In the kitchen seems like salary guys spend long hours. If you have another job, other interest salary not as good as it may seem. 

I thought Seattle was part of Canada


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## Johnb

I work in a kitchen where all employees are on salary, line cooks make 35k a year and work 5 twelve hour shifts a week. This new change is going to see us all go to hourly, with 20 hours of overtime a week. Now instead of salary, we will be making close to minimum wage, but all of the benefits go out the window. The salary rule makes sense for people at McDonald's, but not at a high end restaurant. This executive order essentially takes away my paid vacation


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## fujiyama

Johnb said:


> I work in a kitchen where all employees are on salary, line cooks make 35k a year and work 5 twelve hour shifts a week. This new change is going to see us all go to hourly, with 20 hours of overtime a week. *Now instead of salary, we will be making close to minimum wage*, but all of the benefits go out the window. The salary rule makes sense for people at McDonald's, but not at a high end restaurant. This executive order essentially takes away my paid vacation



Just to clarify, 

5 days per week x 11.5 hours per day (half hour lunch) = 57.5 hours a week 
57.5 hours a week x 52 weeks in a year = 2990 hours per year
$35,000 / 2990 hours = $11.70 per hour

_You already are making close to minimum wage._ If you didn't take a half hour break, you'd be making 50 cents less per hour. $11.20 

When it comes to vacation time, almost everyone is entitled to have it paid. Including hourly employees. Benefits (assuming you're talking medical) should not change. It's likely that you pay a portion of your cheque towards those benefits anyway.

Let's be honest here, if you were on hourly and got 20 hours of overtime you'd be making more money. 

Let's say they took salary away and only paid you $11 an hour.

11 x 40 = 440
16.5 x 17.5 = 288.75
728.75 x 52 weeks = 37,895 per year

Like I said earlier, the minimum wage will raise significantly in the coming years. They won't be able to offer you only $11. 

We're getting ahead of ourselves here though. I wouldn't assume they will put you on hourly. In the long run, they're better off raising your salary to $48,000 a year and not paying any overtime.


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## skewed

Johnb said:


> I work in a kitchen where all employees are on salary, line cooks make 35k a year and work 5 twelve hour shifts a week. This new change is going to see us all go to hourly, with 20 hours of overtime a week. Now instead of salary, we will be making close to minimum wage, but all of the benefits go out the window. The salary rule makes sense for people at McDonald's, but not at a high end restaurant. This executive order essentially takes away my paid vacation



Here is the real issue: how does an employer justify the exemption for these line cooks (please look up the federal exemptions)? I do not understand how this has been allowed to happen for so long. The exemptions are mainly put in place for 'white collar' jobs not for jobs requiring mostly hands on physical labor. California even enacted laws to further clarify this to avoid massive law suits.

Also, just because this has been the culture of our industry for many years does not make it ethical or just. We work our rears off usually due to our passion but we still need to be paid for our work. I have worked salary positions that never attempted to aim near 40hr/wk... ever (I assume this is pretty normal).

Personally, once I became a father (and especially after becoming a single parent with nearly full time custody), this situation became unsustainable for my family. Low pay for long hours. If I have to sacrifice family time for work then I at least should be paid for that time (IMHO). Also, I see it as an incentive for employers to utilize workers more efficiently and not take the extra hours for granted. Upper management who actually qualify for the exemption might have to put in the extra hours to limit the amount of overtime.

/rant over/ just my view from my experience


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## panda

i actually work more hours during slow periods because of cutting hours for cooks has to be made up somehow. but i appreciate being salaried because it's the same check every time, i don't have to worry about saving wages for slow periods where i can't get any overtime. it's basically like being hourly but with a strong wage and minimum 10hrs overtime per week.


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## JDA_NC

In my contract my "salary" in slightly north of 40k a year.

Once all the "benefits" from the restaurant/group are taken out my base salary is slightly south of 30k a year.

Once taxes come out I make roughly 22k a year.... meaning my checks are smaller than line cooks who work 50hrs a week at $13hr.

That's without me getting health care through the company (Marketplace gives me a better deal).

I'm not saying everyone who is salaried in the restaurant business is in the same boat. And I love my job. I work for an awesome restaurant and one of the best/most successful restaurant groups in a major US city. But this won't affect me in the slightest because I am sure they will be giving me, and everyone else who is in a similar boat, another few grand worth's of imaginary bonuses.


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## dough

I agree this is a non-issue bc if an executive order offers me money that doesn't exist what is the point. honestly its a bit insulting in the sense im not smart enough to get what im worth and to thank the man running this place and think he was benevolent enough to invite me to enjoy his splendor is very misguided.


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## kostantinos

As i understand this while everyone gets a pay raise uncle Sam gets to tax everyone more since median income and taxes will be higher . That way he" raises " income tax money indirectly . Thats what i am seeing here and point blank that the issues will not be solved in the long run and the burden of this will fall into small business and regular workforce middle class .

Am i wrong?


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## Chuckles

That's about it. 

The bonuses idea is interesting. It would have to be quarterly bonuses to be in compliance if I read it right. With the turnover in the industry that could save some money on employees that leave.


35k salaries is why this law exists. That isn't cool.


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## brainsausage

Bonuses only can be applied for up to 10% of salary coverage, from what I understand.


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## Chuckles

So $1200 a quarter if salary is $48,000. I've lost five managers just under the minimum this year so far. That $6000 could go towards helping pay the other managers more. Just thinking out loud here.


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## brainsausage

Chuckles said:


> So $1200 a quarter if salary is $48,000. I've lost five managers just under the minimum this year so far. That $6000 could go towards helping pay the other managers more. Just thinking out loud here.



I agree. My current bonuses(if I reach my stretch goals) are 1600 a quarter, and with my reg salary I'm making just under the salary cap, which isn't counting a nice chunk of catering 'tips' that aren't talked about. My bosses are good guys. But this is definitely going to be a topic of discussion at the manager meetings in our restaurant group for the foreseeable future. We're already struggling with an influx of new restaurants in a very small area/heightened media attention/tourists/gentrification/higher rents, which has led to an incredibly small pool of qualified workers. The min wage also just increased this year. My sous and I are working more hours than ever just to keep the ship afloat, and job searches are yielding next to none even halfway decent help. It's getting to be pretty damn frustrating.


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## MAS4T0

What's the primary expense making the margins so tight for restaurants? Is it the rent on the premises, the ingredient cost, the staff?


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## Dardeau

The small talent pool is a real struggle.


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## JohnnyChance

MAS4T0 said:


> What's the primary expense making the margins so tight for restaurants? Is it the rent on the premises, the ingredient cost, the staff?



The traditional breakdown of costs is 30% food, 30% labor, 30% rent/utilities/etc. In theory 10% profit. Most fine dining places are running higher on either food or labor or both. The more casual fine dining that has been popular the last 10 years is a result of rethinking the rent/utilities/etc by cutting out linens and other superfluous expenses that were once associated with high end restaurants.


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## kostantinos

A lot of the restaurants are saved by 2 peripheral sources of income which is Private dinning / Banquets and liquor /beer/wine sales . Usually the high profit margins and low purchasing cost on both of these are ridiculous compared to the 30% cost you have on food on average on an upscale restaurant. Pretty much a restaurant that can sell liquor and wine "heavy" will be much more healthy in numbers at the end of the year and produce a higher profit margin .


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## malexthekid

That is too true. Was looking through the menu of a restaurant my wife is going to and saw a bottle of wine i had brought a few of the previous week. I paid $35 a bottle at the cellar door they were asking $85.


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## JohnnyChance

malexthekid said:


> That is too true. Was looking through the menu of a restaurant my wife is going to and saw a bottle of wine i had brought a few of the previous week. I paid $35 a bottle at the cellar door they were asking $85.



That markup is common. Just like a $10+ cocktail uses 1.5-2oz of a spirit that will pay for the entire bottle after 2 drinks.

In addition to covering a wide range of regions, styles, varietals and price ranges, quality wine programs in restaurants often try to stock things that aren't necessarily commonly available at retail. So you avoid this exact problem: seeing your go to $14 bottle of red for sale for $45.


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## joshsy81

Dardeau said:


> The small talent pool is a real struggle.


I feel it's been reduced to a talent puddle. I'm in an almost constant hiring mode and I see very little in the way of quality looking resume's let alone actual talent and skill. I've actually seen plenty of resume's with zero cooking experience on them applying to a line job. I also get mostly younger cats and their work ethic IMO is ****. It's hugely frustrating.


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## brainsausage

joshsy81 said:


> I feel it's been reduced to a talent puddle. I'm in an almost constant hiring mode and I see very little in the way of quality looking resume's let alone actual talent and skill. I've actually seen plenty of resume's with zero cooking experience on them applying to a line job. I also get mostly younger cats and their work ethic IMO is ****. It's hugely frustrating.



I'm experiencing that exact same frustration myself.


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## alterwisser

I work in a totally different industry (Manufacturing), that is far from being a high paying industry like pharma or financial. And I am not making big bucks for sure, I guess decent for my level and years of experience. 

For one, I am always amazed seeing the salaries posted here for various jobs (line cooks, sous chefs etc.) and the hours it takes to make these salaries. I admire your passion for the job. I don't know how people live in that type of money with a family in my neck of the woods (NJ, VERY close to NYC). I am privileged to have a decent salary and a better half (or as my dad likes to say: WAY better half) that makes great money as a pharma exec (and let's me have some play money for knives LOL).

About salaried employees: I was told the other day that if - as a salaried employee - I can basically leave 5 minutes after showing up at the office and no one can say anything legally, or even ask me to take PTO. I am not sure if that is a NJ law, or whatever it is ... but I found it interesting. I am pretty sure some bosses would have none of that, especially in some industries LOL

Last but not least - and this might sound a bit too socialist to some folks in the US - but I cannot see how this imbalance in salaries and wealth is socially sustainable in the long run. If it doesn't change peacefully at some point, it will violently. I hope this is not too much of a political statement, if so, please let me know and I will delete this part.


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