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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 5615 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 5615
To amend the Fair Labor Standards Act of 1938 to protect worker access
to employer equity, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 30, 2026
Mrs. Moody introduced the following bill; which was read twice and
referred to the Committee on Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To amend the Fair Labor Standards Act of 1938 to protect worker access
to employer equity, and for other purposes.
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 ``Valuing Employee Stock Today Act''
or the ``VEST Act''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) The Worker Economic Opportunity Act (Public Law 106-
202), enacted on May 18, 2000, amended section 7(e) of the Fair
Labor Standards Act of 1938 (29 U.S.C. 207(e)) by adding a new
paragraph (8) to such section 7(e) to exempt any value or
income derived from employer-provided grants or rights provided
pursuant to a stock option, stock appreciation right, or bona
fide employee stock purchase program from the determination of
an employee's regular rate for purposes of calculating such
employee's overtime compensation.
(2) The lack of explicit mention of restricted stock units
in paragraph (8) of section 7(e) of the Fair Labor Standards
Act of 1938 (29 U.S.C. 207(e)), as added by the Worker Economic
Opportunity Act (Public Law 106-202), was not an intentional
exclusion from such paragraph (8), but a reflection that this
type of equity award was not commonly used as of the date of
enactment of the Worker Economic Opportunity Act (Public Law
106-202).
(3) Congress clearly established in the Joint Statement of
Legislative Intent accompanying the Worker Economic Opportunity
Act (Public Law 106-202) that such Act was designed to be broad
and flexible enough ``to accommodate a wide variety of
[employee equity] programs'' and to ``be flexible and forward-
looking'' and interpreted consistent with its purpose ``to
encourage employers to provide opportunities for equity
participation to employees''.
(4) In the years since 2000, restricted stock units have
become a highly common form of equity for both salaried and
hourly employees that, consistent with the Joint Statement of
Legislative Intent accompanying the Worker Economic Opportunity
Act (Public Law 106-202), allow employees to share in the
future success of their companies through a mechanism that may
not otherwise be available to rank-and-file workers.
(5) Restricted stock units should qualify for the exemption
from regular rate determinations under paragraph (8) of section
7(e) of the Fair Labor Standards Act of 1938 (29 U.S.C.
207(e)(8)) because such paragraph would have explicitly
mentioned restricted stock units as qualifying for such
exemption had restricted stock units been a common form of
employer-provided equity compensation as of the date of
enactment of the Worker Economic Opportunity Act (Public Law
106-202).
SEC. 3. CLARIFICATION OF THE EMPLOYER EQUITY EXEMPTION FROM REGULAR
RATE DETERMINATIONS.
(a) Clarification.--Section 7(e)(8) of the Fair Labor Standards Act
of 1938 (29 U.S.C. 207(e)(8)) is amended--
(1) in the matter preceding subparagraph (A), by striking
``or bona fide employee stock purchase program'' and inserting
``bona fide employee stock purchase program, or restricted
stock unit program''; and
(2) in subparagraph (C), by striking ``exercise'' and
inserting ``exercise or acceptance''.
(b) Effective Date; Liability of Employers.--
(1) Effective date.--The amendments made by this section
shall take effect on the date that is 90 days after the date of
enactment of this Act.
(2) Liability of employers.--No employer shall be liable
under the Fair Labor Standards Act of 1938 (29 U.S.C. 201 et
seq.), as amended by subsection (a), for any failure to include
in an employee's regular rate (as defined for purposes of such
Act) any income or value derived from employer-provided grants
or rights obtained pursuant to any restricted stock unit
program if--
(A) the grants or rights were obtained before the
effective date described in paragraph (1);
(B) the grants or rights were obtained within the
12-month period beginning on the effective date
described in paragraph (1), so long as such program was
in existence on the date of enactment of this Act and
will require shareholder approval to modify such
program to comply with section 7(e)(8) of the Fair
Labor Standards Act of 1938 (29 U.S.C. 207(e)(8)), as
amended by subsection (a); or
(C) such program is provided under a collective
bargaining agreement that is in effect on the effective
date described in paragraph (1).
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