Labor Policy Changes Under the Trump Administration


Most of the news about the Trump Administration in recent days has involved developments arising out of the special counsel’s investigation. But as Labor Day approaches, it is worth examining what the administration has accomplished in the labor arena. Many stories about changes in regulations are getting less media attention than they might have, had we not had daily stories about sensational prosecutions or pleas and inflammatory tweets about Russia’s meddling and campaign finance violations.

Here are a few of the more significant changes in labor policy under President Trump:

DOL seal.pngFair Labor Standards Act: Although the 80-year-old Fair Labor Standards Act remains largely unchanged, the Department of Labor has again started using DOL opinion letters, which the Obama Administration had abolished. Opinion letters provide guidance that employers can rely on for interpretation of the regulations, so returning to this practice is a help. Moreover, many of the Bush Administration opinion letters have been reinstated.

Furthermore, in June 2017 the Trump Administration withdrew the Obama-era interpretation on joint employment. The joint employment interpretation—designed to make large franchisors liable for the practices of independently owned franchisees—was roundly criticized by employers, so the return to the former DOL interpretation of when joint employment arises is a welcome relief for employers.

The Trump Administration has also rolled back rulemaking under the white collar overtime exemption and the tip pooling regulations. In both cases, DOL is now attempting to provide employers with broader exemptions and greater relief from regulation.

Still, any changes to current FLSA regulations are likely to engender future litigation, so even if DOL’s Wage & Hour Division issues favorable changes, employers will have a long time to wait until there is certainty in this area.

Broader Range of Health Plans for Small Businesses: As a result of a Trump executive order seeking to reverse or limit portions of Obamacare that can be addressed by regulation, DOL has proposed letting more small firms and individuals form association health plans (AHPs). Large businesses have the market power to get good discounts from health care providers; the proposal is intended to let small businesses, including self-employed workers, pool their populations to get similar discounts through an AHP. Under this proposal, companies or individuals involved in the same type of business or located in the same region could band together to form AHPs.

Any attempts to broaden access to healthcare insurance should be encouraged, even if they do not satisfy all the benefit coverage requirements or other restrictions of Obamacare. More choice in insurance options will help employers of all sizes attract and retain employees.

Union Negotiations: The Trump Administration has pushed federal agencies with unionized workforces to reopen collective bargaining agreements with their public unions. Agencies have also been directed to move swiftly to fire poor performers. The Administration argues it is trying to streamline costly government bureaucracy and improve accountability of the federal workforce.

As with changes under the FLSA, litigation over these changes is likely. (In fact, on August 25, 2018, just as I was finalizing this post, a district court judge overturned some of the executive orders implementing them.)

In Janus v. American Federation of State, County, and Municipal Employees, Council 31 (Sup. Ct. June 27, 2018), the Supreme Cout ruled against public unions in a different context (deciding that public employees could not be forced to pay union dues). This decision weakens public unions, and arguably indicates possible Supreme Court support for government efforts to push back against such unions. However, it remains to be seen whether the Court would help the Trump Administration roll back previously negotiated collective bargaining agreements.

And nothing in Janus changes how the NLRB deals with issues between private employers and their unions, which would be a more helpful area of focus during the next two years of the Trump Administration.

nlrb logoRestrictions on Employee Use of Employer Email: One helpful development for private employers that the Trump Administration has undertaken is that the National Labor Relations Board (NLRB) has invited briefs on whether it should overrule Purple Communications, Inc., 361 NLRB 1050 (2014). The Board held in that case that employees had a presumptive right to use employer email systems on nonworking time for organizing and other protected communications under the National Labor Relations Act.  In Purple Communications, the Board overruled its earlier decisions holding that employers could maintain union-neutral policies regarding permissible uses of their email systems, even if these policies had the incidental effect of limiting use of those systems for union–related communications. Presumably, the NLRB is now considering a return to the holding of those prior cases.

This and other NLRB actions could have far-ranging impact on employers’ efforts to maintain union-free workplaces. However, NLRB policy in recent decades has tended to shift with the party affiliations of the five NLRB members, so whatever the current administration does could once again be overruled.

Application of Religious Freedom Principles to the Workplace: DOL is attempting to make it easier for federal contractors to claim religious beliefs as a defense against anti-LGBTQ discrimination complaints. Recent directives state that the federal government has a duty to protect religious exercise, not to impede it. The Administration has instructed the Office of Federal Contract Compliance Programs (OFCCP) not to condition federal contracts “upon a recipient’s willingness to surrender his [or her] religiously impelled status.” Rather, faith-based organizations should be permitted to compete on a level playing field for federal contracts.

There will be a rulemaking process, so the impact of these directives may not be known for some time.

* * * * *

All in all, there have been some helpful changes at the DOL, the NLRB, and other labor policy-making agencies. However, much of the Obama Administration’s overreach in the labor arena remains in place.

Employers should encourage the current administration and Congress to pursue business-friendly policies designed to keep the economy growing. Perhaps the likelihood of continued media attention on the special prosecutor’s investigation will enable more good regulatory work to move labor laws and policy in directions conducive to business and employment growth.

But employers should also remain mindful of the need to comply with labor laws and regulations currently in effect.

What labor policies would you like to see changed and why?

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