Pressure Builds on Labor Department to Change Stance on Options and Overtime Pay

Bipartisan legislation has been introduced in the House of Representatives to clarify that stock option awards should not be taken into account when calculating overtime pay. The Stock Options Preservation Act, still being drafted, will be introduced by Randy Cunningham (R-CA), Jim Moran (D-VA) and others. It will state that any spread realized on the exercise of employee options will not be subject to overtime rules under the Fair Labor Standards Act. A recent Department of Labor Opinion Letter stated that a company would have to consider these awards under the Act. The Department has since been at pains to point out that opinion letters are not policy and apply only to the facts and circumstances of the particular company to which the letter applies. The Department's Office of the Chief Economist has also launched an investigation into the issue. On March 2, the Subcommittee on Workforce Protection of the House Committee on Education and the Workforce held a hearing on the subject.