NAB reports (Jan-Dec 1941)

Since the nature of such an employee’s employment is that he will receive the fixed basic salary regardless of the number of hours worked it cannot be said that such an employee is paid in excess of what he earns or is entitled to in any W'eek in which he receives the fixed salary eevn though such weeks may have been short weeks. We have considered above the question of the conversion of a salaried employee working a fluctuating number of hours into an hourly rate employee. The amounts paid to an employee while absent from work on a vacation, holiday, sick leave or other miscellaneous periods of leave, may not be considered by the employer as prepaid over¬ time compensation just as the time off during such periods may not be used to balance overtime worked within the pay period. Payment during holidays, vacations, etc., is not payment for overtime and may not be considered by the employer as com¬ pensation for the employee’s overtime work under the Act. In two respects a prepayment plan, if it may be properly applied to salaried employees, is not subject to the same restrictions as a “time off” plan. It is not confined, in its operation, to the pay period. Credits to the employer, i. e., amounts paid by him in excess of the amounts earned by the employee or to which the employee is entitled, may be carried over beyond the pay period until they are consumed by the overtime w'ork of the employee. Secondly, a prepayment plan may be applied to employees who are paid w'eekly. It need not be restricted in its application, as is the “time off” plan, to employees paid on a bi-weekly, semi-monthly, or monthlybasis. Under a prepayment plan the employee is being paid the overtime compensation due him, either in advance or, at the latest, at the time of the regular pay period. Where applicable, a “time off” and “prepayment” plan may be applied in conjunction with each other. Sales PAUL PETER ADDRESSES MARKETING ASSOCIATION Paul Peter, NAB Director of Research, spoke Thurs¬ day, December 26, before the American Marketing Association in convention at Chicago. The convention session, at which Mr. Peter spoke, was titled “Advertising, 1941 Model — How to Get More For Your Advertising Dollar”. Mr. Vernon D. Beatty, Advertising Manager of Swift & Company, was chairman of the session and introduced the speakers as follows: “Put More in Newspapers” — Fred Dickinson, Bureau of .Adver¬ tising, .American Newspaper Publishers Association. “Put More in Magazines” — Frank Braucher, Periodical Pub¬ lishers .Association. “Put More in Outdoor” — F. N. McGehee, Outdoor Advertis¬ ing:. Inc. “Put More in Radio” — Paul F'. Peter, Director of Research, National .Association of Broadcasters. Mr. Peter summarized his discussion as follows: “Why Put More in Radio? Because broadcasting faces 1941 w'ith the largest circulation of any advertising medium ... 9 out of 10 homes with radio . . . more than a third of passenger cars are radio-equipped ... 50 million radios in the country. “Because the use of these sets is increasing ... a greater per¬ centage of families use their sets daily . . . use them for more 6 — January 3, 1941 hours per day . . . use them more in the summer as well as the winter . . . use them more in the daytime ; morning, afternoon and evening. “Because the use of sets in upper, middle, and lower income families is increasing . . . average program ratings are rising giving advertisers lower cost per thousand results . . . lower than any other advertising medium. “Because the nation’s largest advertisers are giving a greater share of their advertising appropriations to radio . . . greater than any other advertising medium. “Because the ‘super-advertisers’, those spending a million dollars or more in the three major media, put the major share of their budgets in radio . . . more of them ‘major’ in radio than any other medium. “Because the average American family is spending more money annually for radio listening (operations, ownership and upkeep) than for purchases of newspapers and magazines combined. Etc. . . . Etc. . . .” NRDGA ASSOCIATE MEMBERSHIP As a result of a conference with Joseph E. Hanson, manager of the Promotion Department of NRDGA, the solicitation of radio stations to take out associate member¬ ship in that organization will be held in abeyance. We are endeavoring to work out a plan with Mr. Hanson which we feel will be mutually beneficial to his organization, to the broadcasters and to NAB. Any contemplating mem¬ bership in NRDGA are asked to communicate with us before taking any action. VOORHIS BILL The Voorhis Bill (H. R. 10720) to tax advertising ex¬ penditures in excess of $100,000 annually, has died with the close of this Congress. Presumably, however, it will be introduced again early in the new Congress. If enacted, it would operate to prevent advertisers from deducting advertising expense, — over and above a basic exemption of $100,000 to each business, — from gross in¬ come in computing taxable net income under the Federal income tax and excess-profits tax laws. The effect of such enactment would be widespread, as there are several hun¬ dred advertisers whose expenditures for advertising in major media annually exceed $100,000. The Voorhis Bill (Voorhis, D. — Cal.): A BILL To provide funds for the national defense; to prevent avoidance of taxes by unlimited investment in advertising; to control un¬ economic advertising expense engaged in by the liquor, tobacco, and luxury trades; to discourage advertising on the public high¬ ways and to derive revenue therefrom ; and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. SHORT TITLE Section 1. This Act may be cited as the “Advertising Tax Act”. FINDINGS AND DECLARATION OF POLICY Sec. 2. (a) Congress hereby finds (1) that some taxpayers are and for many years have been avoiding income taxes by making extravagant investments in good-will advertising: (2) that the graduated levies of the new defense taxes will be largely nullified if unlimited deductions for advertising expense are permitted in computing taxable net income; (3) that much of the advertising sponsored by the liquor, tobacco, and luxury trades is an economic waste not permitted in other countries; and (4) that advertising