Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for Jan. 24, 2014
*Western – regional species perimeter foundation; Southern – regional species slab construction.
Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.
Lumber: Moderate SPF trading for key items pushed prices available to buyers in different directions, although most remained firm or edged higher. Producers urging secondaries to ship their purchased volumes from mills forced a two-tiered pricing structure for some items. Enough demand and constricted availability of some items existed in the Southern Pine lumber market to propel most prices higher. Frigid temperatures again dipped into the South, creating more obstacles for those producers trying to catch up with orders. The Coastal species lumber market remained on firm footing – for the most part. Buyers participated in enough numbers to place modest to moderate upward pressure on most prices. Log prices limited production, forcing one producer to lay off workers. Inland lumber producers have had a busy week fielding phone calls. The buyer emphasis is clearly on narrows. Wides are suspect, and they have come off several dollars. A lack of substantial availability helped keep prices firm. Ponderosa Pine Shop and Mldg&Btr remain very firm, although the last week has seen clear indications of reduced Shop buying among key remanufacturers. Neither Shop nor Mldg&Btr have shown any weakness, although the market is at a temporary plateau. The strong demand that has existed for Ponderosa Pine #2 boards has given way to more muted demand for that line, being replaced by increased interest in #3 boards. Eastern White Pine remains very stable in price, and producers are keeping their core customers clearly in the forefront of any production projections. ESLP activity has been good. Sales activity at the mill level in the Western Red Cedar market remained steady. Buyers quibbled little over higher quotes from mills, placing more importance on access than price.
Panels: Although neither OSB nor Canadian plywood markets show consistency, some clear changes took place. Some Eastern Canadian buyers report a solid uplift in their OSB activity, with an increase of $5 reported for that region. Mills are being proactive. Lackluster rated sheathing sales in the Southern Pine plywood market forced mills to negotiate with customers to move volumes. Weather remained an obstacle, constricting consumption. Freezing rain halted at least one mill’s production Friday. Western Fir plywood producers experienced another week of trying to grind out orders in a market lacking enough demand to absorb production. Producers began to define more clearly floor pricing for sheathing items. Friday morning activity, coupled with selling action at the WRLA show in Saskatoon, provided a good catalyst for Canadian plywood. The market remains indecisive as to the actual strength of the market. Particleboard mills continued to report improvements in the amount of demand and number of inquiries they are receiving, which began to increase last week. Improved MDF sales were also noted by some producers.
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Give me a break
There’s no taking a breather from the requirements of the Fair Labor Standards Act (FLSA). Some of its most arcane requirements pertain, in fact, to breaks. Got all of those rules memorized? What about your managers — do they remember the rules? Probably not, if it’s been more than a year since your last FLSA training. No, it’s not required, but it’s the best way to reduce your potential liabilities. So get out a pen and paper — it’s time for a refresher on the FLSA.
Rest and meal breaks
As a general rule, the FLSA does not require that employees (other than minors) receive any breaks, whether paid or unpaid. Rather, the FLSA’s regulations outline only when breaks must be paid if they are offered at an employer’s sole discretion.
The one exception to the general rule is that, as part of the Patient Protection and Affordable Care Act, employers now, under the FLSA, must provide nonexempt mothers with the time and space to express breast milk for one year after the birth of a child. Few employers limit this right to nonexempt employees only, and many states have laws that go further than the federal law.
Aside from lactation breaks, the regulations divide breaks into two categories: rest breaks and meal breaks. In terms of payment, different rules apply depending on the type of break.
For rest breaks, the regulations stipulate that an employer must pay workers if the period is 20 minutes or less. According to the regulations, breaks lasting five to 20 minutes are common and promote efficiency.
For meal breaks, the regulations stipulate that, ordinarily, an employer must pay workers if the break is less than 30 minutes. The regulations leave open the possibility that shorter meal periods may be noncompensable in special circumstances.
With meal breaks, the burden is on the employer to prove that special circumstances apply justifying the shorter break.
Keep in mind also that the regulations do not always fit today’s workplace reality. Sometimes it is hard to tell whether a break is to rest or to consume a meal.
For this reason, it is not surprising that some U.S. Department of Labor (DOL) investigators, as a matter of enforcement, have taken the position that an employer must pay workers for all breaks that are less than 30 minutes. That way, they don’t have to engage in a break-by-break analysis.
In such cases, the DOL’s position is inconsistent with its own regulations and case law. But a 30-minute rule does avoid litigation of that issue.
Even if a meal break is 30 minutes, that does not mean that it automatically occurs without pay. The employer must consider not only the length of the break but also whether the employee is free from work.
If the employer requires the employee to stay in his or her work area, it may have to pay the employee, even if the break is 30 minutes or more. Similarly, if the employer asks an employee to do any work during the break, it may have to pay for the entire break.
It is against this backdrop that this article discusses five common mistakes. Sadly, the risks are greatest when employers are flexible and employees earnest.
The man in a hurry
Suppose an employee gets a 30-minute unpaid lunch break. He asks if he can take 15 minutes instead on a regular basis so that he can be home as soon as possible after his kids return from school. Do you have to pay the employee for the 15-minute meal period even though you are accommodating his request for a shorter break?
Ordinarily, lunch breaks must be 30 minutes or more to be unpaid. This is not one of those exceptions that would qualify as a special circumstance. The presumption is against the employer and an issue for litigation.
Sad but true: Accommodate employees by giving them a short lunch break without paying them and you most probably run afoul of the FLSA.
An alternative way to accommodate the employee and not set yourself up for FLSA liability is to allow the employee to waive his lunch break entirely (so no extra pay). Like many people, he can eat something quickly while walking or working. That assumes you are not in a state where breaks are mandated and cannot be waived.
The desk diner
A different scenario: An employee takes her 30-minute meal break at her desk because she likes to be alone and read. It is her "quiet time." However, if the phone rings, she will answer it. And if her boss is out of town, she will check her boss’s e-mail occasionally over lunch to make sure there are no emergencies. Is her lunch compensable?
There is always a risk that employees will be tempted to work if you allow them to remain at their desks or in their general work areas. While the federal DOL allows a de minimis exception, what is de minimis is determined in the aggregate (looking at day after day). Plus, not every state recognizes the de minimis exception.
Accordingly, if you are going to allow employees to remain at their desks or work areas during lunch, make explicit in writing that they cannot do any work of any kind during their lunch break. To take away the temptation to work, consider instructing them to turn the computer off and forward their phone calls to voice mail or to co-workers when they eat at their desks. This feels awkward but is less onerous than defending a collective action.
If employees do any work during their lunch, you may have to pay them for the entire lunch break (since they did not get 30 minutes of uninterrupted time)—not because you were flouting the law but because you were flexible and they were earnest.
Consider a timekeeping attestation at the end of the day that asks employees whether they did any work during their unpaid meal break. If they say yes, pay them but monitor them. If they say no but later claim they did, you have a strong defense, provided that management did not have actual or constructive knowledge of any alleged work done during the meal break. Supervisory training on this issue is critical.
Your employees get 30-minute lunch breaks. They are working on a major project for an important client, so many return to work before the 30 minutes are up. Most return between 25 and 30 minutes after logging out for lunch. Of course, they get paid as soon as they log back in to work.
The fact that the employees are eager to return to work most likely is not a special circumstance. The irony is that your best and more diligent employees may be your problem here.
Three possible solutions are available — none of which is particularly appealing but all of which are more desirable than a collective action.
• Have the timekeeping system prohibit logins before the 30 minutes have expired and make sure no work is done until the minutes are up.
• Have a supervisor monitor when employees return from lunch to prevent early returns.
• Monitor, pay and discipline those who return early.
State, federal law conflicts
Some state laws require an unpaid 20-minute rest break every day. Say the employer provides its employees with a 20-minute break in accordance with state law. How do you respond to the federal DOL when it tells you that the rest period must be paid according to the FLSA?
For example, under West Virginia law, employers must provide an unpaid 20-minute break during a workday of six hours or more. Under West Virginia law, bona fide breaks are not work time.
But even if breaks are unpaid under state law, they may be compensable under federal law. If you are required to provide a 20-minute unpaid rest break under state law, increase it to 21 minutes so you can argue that it should be unpaid under federal law, too.
The safest approach is to pay for all breaks that are less than 30 minutes. While that may mean a longer day for your employees, it will result in less time for you fighting in court.
Last example: An employer prohibits smoke breaks other than during lunch. A few employees sneak smoke breaks that average three minutes before and after lunch. When the employer discovers this, it tells the employees that it won’t pay for their smoke breaks and that they must clock in and out for smoke breaks; otherwise, they will be fired. Is this a lawful alternative to discharge?
There is no duty to provide smoke breaks. You can discipline employees for taking them, up to and including discharge.
What you cannot do is provide short smoke breaks that are unpaid. Smoking without permission is a rule violation that must be dealt with through performance management, not through compensation reduction.
What if the employee asks for the break as an accommodation because, after all, smoking is addictive?
Sorry, no dice. We don’t have to give Jack Daniels breaks when employees depend on alcohol, and we don’t have to give smoke breaks to those who depend on nicotine. That may be the only break the law gives us.
Jonathan A. Segal is a contributing editor of HR Magazine and a partner at Duane Morris LLP in Philadelphia. Follow him on Twitter @Jonathan_HR_law.
© 2013, Society for Human Resource Management