Urban Outfitters gets into the holiday spirit by asking its employees to work for free
An internal memo to the staff of hipster retailer Urban Outfitters, which was leaked to Gawker, gives us a window into how the retailer’s Philadelphia-based parent company, URBN, plans to deal with the upcoming holiday rush. Their not-so-innovative idea: ask employees to work for free.
In a “call for volunteers,” URBN informs the staff that “October will be the busiest month yet for the [fulfillment] center, and we need additional helping hands to ensure the timely shipment of orders.” It goes on to explain to its employees that “as a volunteer, you will work side by side with your [fulfillment center] colleagues to help pick, pack and ship orders for our wholesale and direct customers.”
In short, URBN, whose executive staff took home a combined $12.2 million in compensation last year, is asking its employees to take time out of their weekends to commute to rural Pennsylvania and work in a warehouse—for free.
Unsurprisingly, this request is most likely illegal. According to the Fair Labor Standards Act (FLSA), it is unlawful for a for-profit employer “to suffer or permit” someone to work without compensation—consequently, asking an employee who is not “exempt” to “volunteer” for a for-profit enterprise, whether they are salaried or hourly, is explicitly prohibited by the FLSA.
That the email was sent exclusively to URBN’s salaried workforce is evidence that URBN knows they are potentially on legally shaky ground in their request. The only circumstance in which URBN may have acted in accordance with federal labor law is if they were certain that every single person asked to volunteer was exempt from overtime protections due to their status as well-compensated managerial and professional employees.
In 1938, the FLSA established the 40-hour workweek by requiring that employers pay time-and-a-half for weekly hours worked beyond 40, in recognition of the fact that employees need time for themselves, their families, and their communities. If you are a fan of weekends, you have the FLSA to thank.
The chief exemption to an employer’s obligation to pay overtime is for workers who, because of their high pay and responsibilities, have enough bargaining power within their workplace that they don’t need overtime protections. Critically, the FLSA, sets a salary threshold below which any worker is guaranteed the right to earn overtime pay, regardless of their duties.
This salary threshold, which is meant to provide a simple definition of who is a manager (and thus not automatically guaranteed overtime pay), used to protect about 60 percent of the salaried workforce from overtime abuse. But due to inflation and congressional inaction, today it only protects about 8 percent. The Department of Labor (DOL) is in the process of updating the threshold, a move that would protect up to 15 million workers from overtime abuse.
This critical move by the DOL will shield millions of workers, including many white-collar workers like those at URBN, from being inappropriately categorized by their employers as exempt executives for the purposes of not having to pay them for every hour worked.
URBN has issued a response to the Gawker article, saying, “We received a tremendous response, including many of our senior management. The dedication and commitment of URBN employees are second to none, and their response to this request is a testament to their solidarity and continued success…”
URBN is right: being asked to take time out of your weekend to work for free does inspire a certain amount of solidarity. Let’s hope that it translates into the staff raising their voices to demand fair compensation for their work. One way to start? Organizing a union—the single most effective way for workers to improve their working conditions and to raise wages.