Urban Outfitters “Asks” Salaried Workers to Volunteer

Can an employer ask a worker to “volunteer” to work on weekends?

This concept is being tested by the affluent retailer Urban Outfitters, Inc., which asked salaried employees at the company’s Philadelphia corporate headquarters to “volunteer” to work six-hour shifts on weekends throughout October at the  company’s new fulfillment center about 50 miles outside Philadelphia.  Urban Outfitters operates under the Anthropologie, Bhldn, Free People, Terrain and Urban Outfitters brands.  Somewhat ironically,  the company announced in August that its total  net sales had increased in the second quarter by 7% over the prior year to a record $867 million.

A memo leaked  to Gawker  states that “volunteers” will “work side by side with your [fulfillment center] colleagues to help pick, pack and ship orders for our wholesale and direct customers.” The memo continues: “In addition to servicing the needs of our customers, it’s a great way to experience our fulfillment operations first hand. Get your co-workers together for a team building activity!”

Salaried workers are exempt from the protection of the Fair Labor Standards Act of 1938, which established the 40-hour work week and regulates the payment of wages and overtime.  They can be forced to work uncompensated overtime. But it’s a different thing to ask workers – even salaried workers –  to volunteer. The FLSA prohibits for-profit employers from permitting any individual to “suffer or permit to” work without compensation. The definition of “volunteer” is to work without compensation. So it stands to reason that for-profit employers cannot ask any employee to “volunteer” to work.

The situation demonstrates the problems facing workers who are exempt from the FLSA – especially poorly paid white-collar workers.

Urban Outfitters’ CEO; Richard Hayne’s net worth is approximately $1.35 billion (according to the Forbes billionaires list) but many white-collar workers are not so lucky. They are  barely paid enough to put food on the table.  The FLSA’s “white collar” exemption applies to employees whose job duties primarily involve executive, administrative, or professional duties and who earn a salary of at least $455 per week or $23,660 a year. This poverty-level paycheck is particularly brutal for single parents (mainly women) who must schedule and pay for child care. And, let’s face it, an employer’s request for volunteers is inherently coercive. Only a courageous worker can pass up an opportunity to experience the fulfillment center “first hand” in a “team building activity”?

Last summer, the U.S. Department of Labor (DOL) announced a proposed rule to amend the FLSA “white-collar” exemption to eventually eliminate the exempt status of an estimated 21.4 million“white -collar”employees. The DOL’s proposed regulations dramatically increase the minimum salary threshold for exempt status workers to $970 per week or $50,440 per year. This represents the 40th percentile of earnings for all full-time salaried workers throughout the United States.

But for now, it appears that salaried workers at Urban Outfitters who don’t want to risk their jobs by refusing to “volunteer”  will be spending their weekends packing overpriced clothing into cardboard boxes.

It should be noted the FLSA does permit individuals to volunteer in the non-profit sector for religious, charitable, civic or humanitarian  organizations and to perform volunteer services for a state or local government agencies. Indeed, the U.S.Department of Justice  has the gall to retain licensed attorney volunteers for up to a year at a time to work as unpaid prosecutors along-side Assistant U.S. Attorneys who earn a starting salary of more than $75,000. Instead of leading the nation, it seems the federal government, including the Office of Personnel Management,  is intent upon perpetuating  hiring practices that are sadly antiquated and even discriminatory .

Chipping Away at the Wage Gap Through Transparency

One reason women consistently get paid less for equal work is  that they don’t know how much their male counterparts are earning.

President Barack Obama’s Pay Transparency Executive Order promises to help chip away at the wage gap by eliminating barriers to transparency in worker pay.

The Office of Federal Contract Compliance Programs (OFCCP), a division of the U.S. Department of Labor (DOL) that investigates pay discrimination in the federal government, recently released a  proposed final rule to implement Obama’s executive order. The Rule was published in the Federal Register on September 11, 2015 and will take effect 120 days from publication – January 11, 2016.

The order, issued on April 8, 2014, prohibits federal contractors and subcontractors from discriminating against employees and job applicants who inquire about, discuss, or disclose their own compensation or the compensation of other employees or applicants.

The pay transparency rule includes a hammer.

Contractors must submit  pay, race and gender data on their employees to the DOL each year. The DOL will use the compensation data to target contractors who appear to be engaging in pay discrimination against women and people of color.

The OFCCP contends the 118-page rule will contribute “to building an economy that works for everyone” and “make the contractor workforce more efficient.”

Employers are required to update their nondiscrimination policies to include language addressing pay transparency. This language must be incorporated into employee manuals or handbooks and disseminated to employees and job applicants.

Employers have two possible defenses to a pay discrimination charge: a general defense, which could be based on the enforcement of a “workplace rule” that does not prohibit the discussion of compensation information, and an “essential job functions” defense.

A third of all American women live in or near poverty – Center for American Progress

The pay gap has ramifications for all women but it  is especially critical for low-income and retired women.

A 2014 report by Maria Shriver and the Center for American Progress found that a third of all American women are living at or on ‘‘the brink of poverty.’’ This  equals to 42 million women – plus the 28 million children who depend on them.

The gap has devestating consequences for women in later life. The Social Security Administration’s formula for awarding retirement benefits is based upon lifetime earnings so the wage gap contributes to poverty in old age for millions of  women who have worked hard all of their lives.

What is the Wage Gap?

Comparing census data on average annual wages in 2013 reveals that women make 78 cents for every dollar that men make.

The DOL states that a  typical woman who works every year between ages 25 and 65 loses $420,000 over her working lifetime because of the earnings gap (based on median annual earnings for full-time year-round workers at age 25 and above in 2013).

The gap is wider for some women of color.  Census data shows  African-American women arre making 64 cents, Latina women making 56 cents, and Asian women making 86 cents per dollar earned by a non-Hispanic white man.

The wage gap is just one of many factors, that contribute to the gender pay disparity, including sex discrimination in hiring,  assignments, promotions and terminations.