Piliero Mazza & Pargament, PLLC   Vol. 6, Issue 6,  June 2004

Addressing Tribal and Alaska Native Corporation
Legal and Business Issues


The articles shown here are excerpts -- if you'd like to subscribe to Tribal Advocate, please contact Susan Brock at (202) 857-1000 or at   


  A R T I C L E S


EMPLOYMENT - Department of Labor Revised the Fair Labor Standards Act
INTERVIEW - "Doing Business Abroad" - An Interview with Charito Kruvant
SMALL BUSINESS - Senate Committee Holds Hearing on DOE's Small Business Contracting Policies
REGULATIONS -SBA Publishes Long-Awaited Rules


 

EMPLOYMENT

Department of Labor Revised the Fair Labor Standards Act

The U.S. Department of Labor (DOL) has published its long-awaited final regulations defining the "white-collar" exemptions to the minimum wage and overtime requirements of the federal Fair Labor Standards Act (FLSA). The new regulations will become effective August 23, 2004, unless Congress amends the FLSA or otherwise takes action to block the regulations.

The final regulations do not, as many employers had hoped, effect sweeping changes to the white-collar exemptions. Unlike the proposed regulations, published in March 2003, the final regulations leave the existing short test criteria for exemption relatively intact. The rarely applied "long" test for exempt status has been eliminated, and the minimum weekly salary threshold has been raised from $250 to $455 per week. The following is a brief summary of the final regulations, focusing on the three main "white-collar" exemptions:Executive Exemption

No significant changes have been made to the existing "short test" for exempt "executive" status. Executives must now have the authority to hire or fire other employees, or their suggestions and recommendations as to the hiring, firing, advancement, promotion or other status changes must be given particular weight. This was already an element of the "long test" for exempt status. The term "particular weight" will be satisfied if, for example, the employee’s suggestions are frequently followed.

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INTERVIEW

Doing Business Abroad - An Interview with Charito Kruvant

The Tribal Advocate recently had the pleasure of speaking with Charito Kruvant, co-founder of Creative Associates International, Inc., a once-small business that performs work in the United States and abroad. Ms. Kruvant shared her insights on a range of issues, including some of the challenges and opportunities involved with doing international work as a small business.

TA: Would you please tell us a little bit about your company?

Ms. Kruvant: Creative Associates was founded in 1977 by me and three other women from very diverse ethnic backgrounds. We focused in areas of education and social change. As we grew, we became Creative Associates International.

TA: Did you initially pursue governmental work as a prime-contractor or as a subcontractor?

Ms. Kruvant: From the very beginning, we committed ourselves to making it on our own as prime contractors. We sought to be the prime contractor even though it may have involved small contracts. We also felt strongly that doing work domestically and internationally was probably the best combination of efforts. Our first contract was $2,000.00 and the next one was $130,000.00. We were primes on both.

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SMALL BUSINESS

Senate Committee Holds Hearing on DOE's Small Business Contracting Policies

On May 18, 2004, the Tribal Advocate had the opportunity to attend a Senate Energy and Natural Resources Committee (Committee) hearing to receive testimony regarding the Department of Energy’s (DOE) contracting policies with small business. Chairman Pete Domenici (NM-R) convened the hearing, and Ranking Member Jeff Bingaman (NM-D) attended. During the 50-minute event, the Committee heard testimony from five witnesses: The Honorable Kyle McSlarrow (Deputy Secretary, DOE); Robin Nazzaro (Director, Natural Resources & Environment, General Accounting Office (GAO); Joan Woodard, (Deputy Director, Sandia National Laboratories); Ann Sullivan (Legislative Consultant, Women Impacting Public Policy); and Robert Thompson, (Chairman, Energy Communities Alliance). Each witness submitted written testimony for the record. In addition, other parties who did not testify were able to submit written testimony to the Committee.

By way of background, under the Small Business Act, the federal government must aim to reach a government-wide goal of awarding 23 percent of all prime contracts to small businesses. Particular goals for individual agencies are determined by agencies in coordination with the Small Business Administration. Currently, DOE has a goal of awarding five percent of its prime contracts to small businesses in FY 2004, a goal that has been increased from previous years.

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REGULATIONS

SBA Publishes Long-Awaited Rules

In a flurry of activity during the month of May, the Small Business Administration (SBA) published two Final Rules, one Interim Final Rule, an Advanced Notice of Proposed Rulemaking and a time extension on a fifth rule. Because all of these rules may impact tribally and ANC- owned businesses, as well as Native American-owned businesses, the following brief analysis will serve to make our readers aware of the key issues that these rules cover. A special mailing later in the month to Tribal Advocate subscribers will present a more detailed analysis.

Affiliation – Final Rule: On May 21, 2004, SBA published a final rule that, among other things, amended Section 121.103(b)2) to clarify the exception to affiliation rules for Indian tribes, Alaska Native Corporations (ANCs), Community Development Corporations (CDCs) and Native Hawaiian Organizations (NHO) based on common ownership and common management. The effective date for the rule is June 21, 2004.

In reviewing the comments received, SBA addressed two issues. First, SBA clarified that business concerns owned by Indian tribes, ANCs, CDCs and NHOs will not be considered affiliated with other entities or concerns "wholly-owned" by the tribes, ANCs, CDCs, and NHOs, for size determination purposes based on common ownership. In preparing the final rule, SBA considered comments received suggesting that under the 8(a) Business Development (BD) Program, "wholly-owned" referred only to holding companies of tribes, ANCs, CDCs, and NHOs. In disagreeing with this line of reasoning, SBA stated that "[f]or purposes of the 8(a) BD Program, "wholly-owned" does not refer only to holding companies." In fact, SBA refused to define the term "wholly-owned" because of its clear meaning, 100% ownership.


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