Unexpected Consequences

by John Delach

This is not a political piece. Rather, it is a lesson meant to give pause to arbitrary decisions made by those in power whose aim is to articulate their own agenda without understanding unintended consequences.


President Barack Obama seems to have set a course for the remainder of his time in office to right as many social injustices that he perceives by executive order.  Injustices like transgender rights, minimum wages and workers access to overtime. Last week he increased the salary threshold when overtime for workers should kick in. Maximum salary to collect overtime was $23,000. After that, employees were considered “exempt” meaning they had no rights for overtime. To correct this situation, the president and his economic team have boosted the cut-off threshold to $47,000.


Uncle being Uncle, our bureaucracy never sees the forest for the trees so they tend to treat all workers alike. Be the worker a welder in Bath Iron Works, a person who stacks the shelves in Costco, pumps gas at a Marathon station, or a cashier at Stop and Shop; the same rules apply to everyone.


This one size fits all goes off the rails when applied to “white collar” jobs. According to a recent survey, 64% of 2015 college graduates expected to make less than $45,000 in their first year after finishing school. College graduates who accept starting positions in the fields of insurance, banking, real estate, etc. are not taking jobs, they are accepting entry points for possible careers. President Obama and co. simply don’t get it. The concept of doing business, especially big business is completely alien to their life vision. I can’t imagine a junior non-lawyer trainee at a prestigious law firm like Willkie, Farr & Gallagher seeking payment for overtime. The same holds true for a new hire at Exxon-Mobil’s HQ in Las Calinas, TX, or Boeing’s in Chicago, Met Life or my old firm, Marsh & McLennan.


Allow me to share what I experienced back in the mid-1980s when I was a manager of a unit in our marine department. This may have been Federal or NYS mandated but a decree came down from our personnel people that effective immediately, any employee making less than $15,000 (more or less) must be put on a time sheet so they could sign in and sign out to be able to collect time and a half for any hours worked over 40 hours. (The time concept is consistent with Obama’s new executive order.)


My boss, H, had just retired from his other job; he was a Sergeant Major in the army reserve. If that doesn’t tell you anything else, it should explain why he did everything by the book. When he addressed me and my fellow managers, I told him that I expected that all hell was about to break loose with our younger brokers who worked their asses off doing the difficult tasks that included staying into the night to assist in completing proposals for the renewal of existing clients’ programs and bids on new programs. These clients and prospects were the essence of big business, firms like DuPont, Chevron, Chiquita Brands, US Steel and National Bulk Carriers. To work on such prestigious accounts or even more exciting, go after new business was sort after, an honor and a privilege and what our firm was known for. We solved big insurance problems for big business.


I admit the world was different then and part of the privilege was the opportunity to be invited to join in lavish client entertainment in the New York scene and, more precious, to accompany the senior people on out-of-town trips.


H stood by the letter of the law. It was my task to inform two brilliant and dedicated junior young women that their salaries were below exempt (the legal term for not being eligible for overtime) and explain that they must use a sign-in, sign-out sheet for their own protection.


I spoke to DV first and it did not go well. She burst into tears and walked out. VB was next; in the middle of my explanation, she rose from the chair, slapped both hands, palms down onto my desk, looked me straight in the eye and said, “This sucks, you suck, Marsh sucks and what the f*** are you going to do about it!”


“Got it,” I replied.


Apparently, H’s other managers received like reactions for he retreated from it over time but I knew I had already lost the spirit of these talented women who both resigned in short order.


Good luck to businesses out there…and: ”Be careful.”