March 2021 has been a busy month in Washington, D.C. In addition to the passage of the American Rescue Plan (which includes tax updates relevant to employers), there have been three notable developments in the labor and employment arena.
First, on March 5, 2021, President Joe Biden fired Sharon Gustafson, the Trump-appointed general counsel of the United States’ Equal Employment Opportunity Commission (EEOC) after Gustafson refused to resign because her term did not expire until 2023. On March 12, 2021, President Biden designated Gwendolyn Young Reams, who served as EEOC’s associate general counsel for litigation management services for two decades, and who has worked as an attorney at EEOC since 1972, as the agency’s acting general counsel. Gustafson’s firing, and Reams’ subsequent appointment, mirrors the controversial firing of former National Labor Relations Board (NLRB) General Counsel Peter Robb, who similarly refused to resign from his post after requests from the Biden Administration.
Second, on March 9, 2021, the House passed the Protecting the Right to Organize Act (the “PRO Act”), which, as we have previously explained, proposes significant amendments to the National Labor Relations Act (the “NLRA”), including implementation of a “card check” process in lieu of formal elections in some cases, reinstatement of streamlined “ambush” union election rules, and personal liability for managers and executives involved in violations.
The PRO Act was originally introduced in 2020, passed in the House, and died in the Senate. The PRO Act is predicted to have a similar fate in the Senate this year, because, while Democrats narrowly control the Senate, their narrow control likely is insufficient to garner enough votes to overcome a filibuster. Notwithstanding the PRO Act’s likely fate, employers should be aware of its potential impact in case it gains traction in the Senate, or if some of its provisions are resurrected through rulemaking by the NLRB.
Third, on March 16, 2021, the U.S. Department of Labor (DOL) proposed revisions to a rule finalized in December by the Trump Administration. That rule, if approved, would have permitted employers to pay tipped employees the tipped minimum wage of $2.13 per hour while the tipped employee performed tasks that did not generate gratuities, as long as the activity was performed either contemporaneously with tip-producing activities or within a “reasonable time immediately before or after” such activities. While the details of the revised proposal are not yet public, it is possible the DOL will alter the Trump Administration’s rule significantly, and that the final rule will be more favorable to service workers and other tipped employees.
As HR Legalist has previously explained, President Biden would like to tilt the scale in a union-friendly direction. These labor-and-employment-related changes are rapidly occurring, and HR Legalist will continue to report on pertinent updates. In the interim, employers should be aware that President Biden’s actions, coupled with those of Congress, demonstrates that Obama-era rules and precedents may return, which may require changes to employee handbooks, policies, and practices.
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