The Department of Labor's (DOL) FairPay Overtime Initiative went into effect on Monday, August 23, 2004. Though the definition of "blue collar worker" has been more clearly distinguished to afford security to first responders—such as police officers, firefighters, paramedics, emergency medical technicians (EMTs), and licensed practical nurses (LPNs), regardless of experience, training, or pay level—it does not include a provision offering the same benefit to registered nurses (RNs). What does this mean for RNs and the facilities in which they practice?

Rules overview Established in 1938, the federal overtime rules were, in part, designed to safeguard low-income earners. They are a component of the Fair Labor Standards Act (FLSA), which requires most employees be paid at least the federal minimum wage and time-and-a-half for all hours worked over 40 in a week. However, its Section 13(a)(1) provides an exemption from both minimum wage and overtime pay for individuals identified as executive, administrative, professional, and outside sales employees, if their job responsibilities and compensation meet certain criteria.

Under the new regulations, employers can choose to classify registered nurses as learned professionals—or possibly, "team leaders"—if they are paid on a salary or fee basis, earn no less than $455 per week, and their primary duty requires advanced knowledge in a field of science or learning that has been routinely achieved via a comprehensive course of specialized, academic instruction. Workers earning $100,000 or more annually (including bonuses and other earnings) will be exempt from overtime pay. RNs compensated on an hourly basis, like travelers, those represented by unions or protected by collective bargaining agreements, and nurses who practice per diem, should remain unaffected.

Industry experts weigh in When asked if her facility intends to continue paying overtime to its registered nurses, a spokesperson—who wishes to remain anonymous—from a Louisville, Kentucky, hospital says, "Absolutely." She adds, "We have heard about a couple of institutions that plan to implement the new rules. But, competitively, from a retention standpoint and in light of the nursing shortage, it would not make sense for us to adopt them."

Christopher Donnellan, associate director of government affairs for the American Nursing Association (ANA), based in Washington, DC, believes most hospital executives are likely to agree with this philosophy. Additionally, he thinks the language used in the regulations could prove harmful to the future of the healthcare industry. "In the short term, I do not believe there is going to be a dramatic impact. Yet, they could have a negative bearing on nursing in the long run. The adjustments to their wording have the potential to chase providers out of the profession and repel others who might otherwise pursue a career in nursing." Patient safety and the wellbeing of RNs are also chief concerns. "If a nurse is exempt because she is viewed as someone in a supervisory position, she may end up practicing more hours than she should, which could lead to serious consequences."

The United American Nurses, AFL-CIO—the country's largest RN union—has stated these regulations "...explicitly leave registered nurses who work overtime unprotected." It is a sentiment to which our unnamed source concurs. "I have heard some nurses say certain agencies have already told them they will not get paid beyond a 40-hour workweek and hourly rates are being modified accordingly." Mr. Donnellan reports that the ANA has anecdotally heard similar accounts. "However, at present, if a hospital implements the regulations, the market will still allow its nurses to go to nearby institutions continuing to offer this benefit."

To address employees' uncertainties about the DOL's FairPay Overtime Initiative, some facilities have developed specific programs, while others plan to supply information informally and as requested. Although mobile clinicians should not be affected, a number of placement agency representatives have armed themselves with the facts, as well. "At this time, we have not had to field any questions," notes Tanya McClendon, MS, RN, vice president of clinical services and chief nurse executive of On Assignment Healthcare Staffing. Based in the company's Cincinnati, Ohio, office, she adds, "Still, our human resources department has furnished our recruiters and other staff members with Q&A documentation covering topics ranging from the rights of RNs to the interpretation of the rules' definitions."