Thursday AM July 24th, 2008
by: Ed Mayberry, July 24, 2008 4:07:00 am
The federal minimum wage increases by 70 cents to $6.55 today. Employers covered by the 70-year-old Fair Labor Standards Act will be entitled to pay at no less than that amount, according to Alex Passantino of the Labor Department's Wage and Hour Division.
"The Fair Labor Standards Act applies to all employers or all enterprises that do $500,000 a year or more in business. It also applies to specific employees at companies that do less business than that, if those employees are engaged in interstate commerce."
Passantino says posters distributed to employers for posting in the workplace are a good way to explain the increase.
"We think so. We do outreach to any number of groups—employer groups, employee groups, work groups, advocacy groups. We have relations with various consulates in an effort to get the word out. We do these types of interviews. We have people who appear on radio programs where they'll take questions and provide answers. And then we have our Web site and our toll-free number, if you need additional information—www.wagehour.dol.gov, and the toll-free number is 866-4US-WAGE."
This is the second of three steps ordered by the Fair Minimum Wage Act of 2007. Last year, the minimum wage increased to $5.85 an hour. A third increase to $7.25 an hour becomes effective a year from now.
Chrysler says it will cut 1,000 salaried jobs worldwide by September 30th. The automaker announced the cuts in a letter to employees. Chrysler says the layoffs are needed because of the prolonged slump in the U.S. auto industry. Chrysler spokesman David Elshoff says the company hopes most of the cuts will be accomplished through early retirements, attrition and voluntary separation programs. But he says involuntary layoffs will be considered if the company fails to meet its targets.
Toyota's global sales topped those of GM in the first half of the year. The Japanese automaker sold more than 4.8 million vehicles in the first six months of the year, marking a rise of two percent from the same period a year earlier. That topped GM's total of 4.5 million vehicles, putting Toyota in the driver's seat to possibly end GM's 77-year reign as the world's top seller. The Detroit automaker blames the tough U.S. economy. GM notes that it posted record-breaking sales in other regions, including Latin America, Asia and Europe. Toyota has been aggressively switching models to boost production of smaller, fuel-efficient vehicles instead of trucks and sport utility vehicles to meet changing consumer tastes.
A new poll suggests the economy is the nation's top concern by far. But the Associated Press-Ipsos poll finds that anxiety about energy has grown more since spring than any other issue, while the focus on Iraq continues to fade. According to the survey, 44 percent of respondents say the economy is the country's most important problem, a small increase from the 39 percent who said so in April. Another 22 percent name energy problems including rising gasoline costs. That's an enormous boost from the four percent who said so last spring. The Iraq war and other foreign affairs issues are named by just 15 percent in the poll. Iraq was cited by 25 percent in April and 40 percent in January, illustrating how rapidly the war has plummeted from its long-held perch as the number one problem.
A Federal Communications Commission member who sought further concessions in a pending satellite radio buyout has withdrawn his offer after it failed to draw support. Because of this, Democratic Commissioner Jonathan Adelstein voted against Sirius Satellite Radio's proposed takeover of XM Satellite Radio. This also means the vote on the regulatory body now stands at 2-2, with Republican member Deborah Taylor Tate still undecided. FCC chairman Kevin Martin and fellow Republican Robert McDowell have both voted in favor of the deal. Democrat Michael Copps voted against it Monday. Adelstein's vote puts even more pressure on Tate, who is seeking resolution of a pending enforcement action against the companies, according to public filings.
A proposed federal rule is aimed at helping millions of participants in 401(k)-style retirement plans get more information about the costs of those programs. The Labor Department says that would make it easier for employees to invest in lower-cost mutual funds and other investments. And that could help boost savings. The department says such disclosures could save participants more than $6 billion over a ten-year period. Some of the savings would come from lower fees as investment providers compete more on cost. The rest would come from the time participants save trying to track down the fees, which are now found in a wide range of different documents. Despite the widespread use of 401(k) plans, most workers still don't know the fees they pay or their impact on savings. The GAO finds about 80 percent of participants don't know how much they pay in fees. If finalized, the rule would take effect in January.
Leading Congressional lawmakers are pushing the Bush administration to withdraw a last-minute proposal that could make it harder to limit workers' exposure to dangerous chemicals. Senator Ted Kennedy of Massachusetts and Congressman George Miller of California, the Democratic chairmen of the Senate and House Labor Committees, made the demand in a letter Wednesday to Labor Secretary Elaine Chao. It came in response to a Washington Post report that the Labor Department is skirting normal procedures to push through a rule change that could slow limits on workplace chemicals and toxins. Such a change has been sought by industry. A Kennedy spokesman called it "outrageous." A Labor Department spokeswoman had no immediate comment.
Fort Worth-based American Airlines has changed instructions that mechanics use to decide how to inspect planes suspected of being hit by lightning. The change is intended to end a standoff between the nation's largest airline and some of its mechanics, who complained to federal safety regulators. The new instructions cover Boeing 767 aircraft that travel over water and are subject to more rigorous inspection standards. They took effect this month. Before this month, work cards directed mechanics to conduct intensive lightning-strike inspections only after pilots reported a suspected hit or eyewitnesses saw lightning in the area. The new instructions give mechanics more authority to initiate inspections in other cases, such as when they see dings or dimples larger than a certain size on planes.
It's been 20 months since the announcement of a deal that would take San Antonio-based Clear Channel Communications private. Now the $17.9 billion deal for the nation's largest owner of radio stations is finally set to close a week from yesterday. That's if shareholders approve the $36-per-share offer today. Regulators have already signed off on the deal, in which private equity firms Bain Capital and Thomas H. Lee Partners would assume about $5.9 billion in debt. Clear Channel has cut the number of radio stations it owns to about 900 from a height of 1,300. It also sold its television station group this year. Outdoor advertising represents about half of Clear Channel's revenue.
The New York Times will increase the Monday-Saturday newsstand cost of its flagship paper by 25 cents to $1.50. Times chief executive Janet Robinson says the price increase for the Times will take effect August 18th. The company has already raised home delivery prices for the paper 4.5 percent in two separate hikes since last July. That helped overall circulation revenue rise 2.5 percent in the latest quarter. The increase will not affect the Sunday edition of the Times, which sells for $4. The move comes a week after the Wall Street Journal said it would boost its newsstand price by 50 cents to $2 starting July 28th to reflect both new content and higher costs. Newspapers are battling sharp rises in newsprint costs and deep declines in advertising revenue.
ConocoPhillips says record crude prices helped its second-quarter profit dwarf year-ago results, when the company incurred a $4.5 billion charge related to its former assets in Venezuela. The Houston-based company said Wednesday net income rose to $5.44 billion for the April-June period, from $301 million in the year-ago quarter. Revenue increased to $71.4 billion from $47.4 billion a year ago. ConocoPhillips, the third-largest U.S. oil company, is the first of the oil majors to report second-quarter earnings. ExxonMobil and Chevron, among others, are scheduled to report results next week.
AT&T says its second-quarter earnings rose 30 percent, but its revenue missed analysts' estimates. The nation's largest telecommunications company said Wednesday it earned $3.77 billion in the three months ended June 30th. That's up from $2.90 billion in the same period a year ago. Revenue rose 4.7 percent to $30.9 billion. Thomson says analysts expected $31.1 billion in revenue. AT&T says it added 1.3 million wireless subscribers, but lost 1.56 million wired phone lines.
Costco, which had been seen as one of the few bright spots in retailing amid economic turmoil, says its profits will suffer from high energy costs. Costco has warned that its earnings will miss Wall Street expectations. The outlook reflects weakness in the company's gasoline operations and slightly lower-than-planned merchandise profits as Costco holds back on price increases to drive sales. Costco's chief financial officer says the lower outlook comes "largely from inflation, particularly as to energy costs." Costco, which sells items in bulk, has attracted crowds of shoppers as they turn to cheaper options and less expensive gasoline amid the sluggish economy.
McDonald's reports returning to profitability in the latest quarter. Along with rising sales around the world, it was helped by a gain from its sale of an interest in a sandwich chain Pret a Manger and strong sales of breakfast items, chicken sandwiches and drinks. The fast-food giant says it earned nearly 1.2 billion, compared to a year-ago loss. The year-ago showing was weighed down by hefty charges from the sale of its Latin America and Caribbean businesses to a licensee. Same-store sales growth was strongest in the Asia/Pacific, Middle East and Africa division as well as Europe.