[Congressional Record Volume 141, Number 5 (Tuesday, January 10, 1995)]
[Senate]
[Pages S738-S739]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. PRESSLER (for himself and Mrs. Kassebaum):
  S. 190. A bill to amend the Fair Labor Standards Act of 1938 to 
exempt employees who perform certain court reporting duties from the 
compensatory time requirements applicable to certain public agencies, 
and for other purposes; to the Committee on Labor and Human Resources.


                  court reporter fair labor amendments

  Mr. PRESSLER. Mr. President, today I am introducing the Court 
Reporter Fair Labor Amendments of 1995. I originally introduced this 
bill last November, during the special GATT session. As I said then, 
the American people sent a strong, clear signal on November 8: they 
want less Government and they want it now. My bill would keep the 
Federal Government from intruding into an area it has no business being 
in, and where its protections are unwanted by everyone concerned.
  Specifically, my bill would exempt State and local courts reporters 
from the compensatory time requirements of the Fair Labor Standards Act 
[FLSA] when they perform private transcription work outside of normal 
working hours or regular working days. A recent interpretation of the 
U.S. Labor Department threatens to radically change the way court 
reporters have been paid for many years. This bill would keep 
undisturbed current pay arrangements between State and local reporters 
and their court employers.
  I am pleased my friend from Kansas, Senator Kassebaum, the new 
chairman of the Labor and Human Resources Committee, is cosponsoring 
this legislation. She has always been a strong proponent of limited 
government. We both realize the public demand for less government has 
never been greater.
  Mr. President, let me explain the situation which brought about the 
need for this legislation. For years, official State and local court 
reporters have enjoyed a unique status among government workers. In 
most States, they are treated as both government employees and 
independent contractors, depending on the nature of the work. While 
performing their primary duties of recording and reading back court 
proceedings, reporters are considered employees of the court. As such, 
they are typically compensated with an annual salary and benefits.
  However, in addition to these in-court duties, most jurisdictions 
also require official court reporters to prepare and certify 
transcripts of their stenographic records for private attorneys, 
litigants, and others. The reporter and his or her assistants prepare 
and deliver transcripts using their own equipment, without any 
supervision by the court. The reporter then bills the attorney or other 
client directly and collects a per page fee set by law or court rule. 
The transcription fees earned are usually twice the amount, or more, 
than those earned during an hour of salaried work for the court. 
Indeed, it is possible for a court reporter to earn more from private 
transcription work than from his or her annual court salary.
  When preparing transcripts for a private fee, the court reporter is 
clearly acting as an independent operator, as has been specifically 
determined by the Internal Revenue Service. For taxation purposes, 
transcription fee income is treated as separate and apart from 
reporters' annual court salaries. In fact, in my home State of South 
Dakota, court reporters are required to collect and pay sales tax on 
this income. They also file self-employment income forms with the 
Internal Revenue Service.
  The transcription services provided by court reporters are invaluable 
to private parties. Attorneys are able to obtain a highly accurate 
recording of court proceedings quickly and reliably. Court reporters 
are small businessmen and businesswomen performing a cost effective and 
timely service. There may be many flaws in our system of justice, but 
our system of court reporting is not among them.
  As I stated earlier, everyone is happy with the current situation. It 
has developed over many years. All interested parties--court reporters, 
judges, and private attorneys--are very satisfied with the present 
arrangement.
  Everyone was happy, that is, until the U.S. Department of Labor 
inserted itself into this situation. Last fall, the Wage and Hour 
Division of the Labor Division took the position that official court 
reporters in Oregon are still acting as employees of the court, for 
purposes of FLSA, when they prepare transcripts for attorneys, 
litigants, and other parties. Similar letters have been received 
regarding official court reporters in Indiana and North Carolina. 
Official court reporters in the vast majority of States operate in 
circumstances similar to these three States.
  The DOL's interpretation would require State and local courts to pay 
court reporters one and one-half times their regular rate of pay for 
all transcription work performed during overtime hours in a given week. 
The Labor

[[Page S739]]

Department's position also exposes State and local courts to 
potentially enormous liability costs from court reporters suing for 
overtime back-pay. If a suit is successful, the court would owe the 
reporter at least 2 years worth of overtime back-pay. The amount would 
be doubled if the court could not demonstrate that it was acting in 
good faith and could go back 3 years if the violation were deemed 
willful.
  If allowed to stand, the impact of the Labor Department's position of 
the court reporting system would be dramatic. State and local courts 
would face increased salary budgets and liability exposure. Court 
reporters facing budgetary cutbacks could lose a significant part of 
their income and, in some cases, their jobs. Private parties would lose 
the productivity and efficiency of the current method of transcription. 
The decision would have adversely affected all interested parties. As 
you might imagine, no one involved in the court reporting system is 
happy with DOL`s position.

  Faced with exposure to millions of dollars of liability nationwide, 
some courts have already implemented changes. Beginning this month, the 
South Dakota Court System imposed a new system of pay for transcription 
on their court reporters. Court salary budgets have also been 
tightened. State court judges must avoid using their reporters too 
much, to keep overtime down. Court administrators have been burdened 
with additional administrative duties and headaches. Private attorneys 
are concerned they can no longer rely on speedy transcriptions at a 
reasonable price. No one is happy with the changes.
  So why are these changes being considered? Because the U.S. 
Department of Labor says so. After all these years, the Department has 
suddenly decided that the Fair Labor Standards Act applies in a 
situation never contemplated by Congress. What fantastic benefits will 
result from this governmental meddling? None.
  I have a solution, however: Don't fix what is not broken. Keep the 
Federal Government out of the situation.
  The bill I am introducing today would allow official court reporters 
an exemption from the Fair Labor Standards Act while they are 
performing transcription duties for a private party, provided there is 
an understanding between the court reporters and their State or local 
court employer. The bill also would bar lawsuits by court reporters for 
overtime back pay.
  Note that only State and local court reporters would be affected. 
That is because Federal court reporters already enjoy a complete 
exemption from FLSA. State and local court reporters deserve similar 
treatment. Passage of my bill would allow all official court 
reporters--Federal State, and local court reporters--to perform their 
work in the same way.
  The Fair Labor Standard Act is designed to protect workers from 
abusive employers. In this situation, however, the very workers who 
would receive the so-called protections of the Federal Government, 
don't want them. Official court reporters would be greatly harmed if 
the helping hand of the Federal Government takes them under its wing. 
They don't want, or need, to be taken care of, especially by 
Washington. That is why the National Court Reporter Association 
strongly supports this bill.
  Mr. President, here is a rare instance where labor and management are 
in agreement on the best solution regarding a labor issue. Everyone 
agrees that the current system serves everyone's best interests. When 
performing transcription services for a private party, court reporters 
are acting as independent contractors. That is what the IRS considers 
them. Federal court reporters are treated that way. I can't think of a 
reason in the world why State and local reporters should be treated any 
differently. I urge my colleagues to support this bill.
  Mr. President, I ask unanimous consent that the bill be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 190

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``The Court Reporter Fair 
     Labor Amendments of 1995''.

     SEC. 2. LIMITATION ON COMPENSATORY TIME FOR COURT REPORTERS.

       Section 7(o) of the Fair Labor Standards Act of 1938 (29 
     U.S.C. 207(o)) is amended--
       (1) by redesignating paragraph (6) as paragraph (7); and
       (2) by inserting after paragraph (5) the following new 
     paragraph:
       (6) A public agency may not be considered to be in 
     violation of subsection (a) with respect to an employee who 
     performs court reporting transcript preparation duties if 
     such public agency and such employee have an understanding 
     that the time spent performing such duties outside of normal 
     working hours or regular working days is not considered as 
     hours or regular working days is not considered as hours 
     worked for the purposes of subsection (a).''.

     SEC. 3. EFFECTIVE DATE OF AMENDMENTS.

       The amendments made by section 2 shall take effect as if 
     included in the provisions of the Fair Labor Standards Act of 
     1938 to which such amendments relate, except that such 
     amendments shall not apply to an action--
       (1) that was brought in a court involving the application 
     of section 7(a) of such Act to an employee who performed 
     court reporting transcript preparation duties; and
       (2) in which a final judgment has been entered on or before 
     the date of enactment of this Act.
                                 ______