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In fact, a bill to revise California's overtime law is wending its way through the Legislature right now. Assembly Bill 60 was written to reinstate the provision that employees are due overtime pay any time they work more than eight hours a day – rather than after they reach 40 hours a week. But the Assembly tacked a number of amendments on the bill before passing it to the Senate, and Saunders says that any number of amendments could be added before the law is passed.

Still, a new law can't deny workers rights already granted by the FSLA. So, even if California decides to recognize the exemption, many high-tech workers -- including trainees and entry-level employees -- could successfully sue employers for up to three years of overtime back pay. And labor lawyers, of course, are just waiting to help.

"The legal industry is just licking its chops -- both plaintiffs and defense attorneys for the companies," says labor attorney Aaron Kaufmann. He thinks wage and hour complaints pose the biggest opportunity for employment lawsuits since the early days of work-related discrimination and harassment suits.

In Kaufmann's mind it's just a matter of time before workers file a class-action suit against one of Silicon Valley's biggest players, like Oracle or Sun Microsystems. Just a few disgruntled employees could send changes rippling through the industry. So what's keeping Silicon Valley workers from flooding their local labor boards with complaints?

In the valley, asking for overtime is a faux pas. The get-rich-quick hype has convinced some of the region's most valuable employees to bet on stock options over cash. The start-up culture has taught many to think of work as a hierarchy-free team effort with distributed ownership -- even if most employees hold a tiny fraction of the shares held by the company's founders and investors. And since overtime is perceived as a benefit that only applies to low-level employees, many workers aspiring to executive status just don't want it.

One research technician at the University of California at Berkeley says she felt she had been demoted when her employer reclassified her as overtime-entitled without her consent. "It did leave me with a feeling of stigma," says Sue (not her real name), "as if I had been bumped from so-called professional to so-called working class."

Brigitte Eaton, a designer for Beyond.com, agrees that overtime pay can diminish a worker's status: "When someone on staff says they worked 80 hours to get a project done," she says, "I'm impressed at their dedication to the project and company. When someone who gets paid overtime says they worked 80 hours, I think, I bet they made good money from doing that.'"

The overtime stigma is obviously great for employers. At one and a half times a worker's hourly wage (or equivalent if salaried), overtime pay can be prohibitively expensive.

If employees began demanding overtime pay, cash-poor companies might find themselves having to beg their staff to cut back on the hours. That could create a monumental shift in the valley's whole race-to-market culture. The balance of power currently favors the small, nimble company whose employees will work ceaselessly to be first out the door with a new product, in hopes of being rewarded by the stock market. But if start-ups couldn't afford to pay for those long hours, would the scales could tip in favor of larger, wealthier companies?

Not necessarily, says Howard Rubin, a research fellow at Meta Group, who says that start-ups might survive overtime just fine. "The people who are putting money into high tech are looking at time to reward and size of reward," he says. If start-up investors had to come up with more money to cover overtime, they probably would, to ensure that their products get out quickly. "Venture funders would just look for a bigger piece of the pie," he says. But if overtime costs really skyrocketed, the funders might switch fields -- go to biotechnology or alternative energy, he says.

But Ethan Winning, a management consultant in Walnut Creek, Calif., says he thinks it's doubtful that state and federal governments would let high-tech entrepreneurship disappear; the tech sector is responsible for too great a piece of the booming economy to be cast adrift. If overtime pay really hit venture capitalists in their pockets -- and threatened to drive them from the tech sector -- legislators would surely uphold all high-tech exemptions to overtime laws. The industry and the Labor Department will come to an agreement, Winning says.

But today, the biggest threat to overtime pay in the tech sector isn't the financial or cultural implications for employers -- it's the lack of interest on the part of employees. If anyone's interested, overtime pay is there for the asking -- at least until the high-tech lobby finds a way to do away with it.
salon.com | July 12, 1999

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