What Can Employers Expect From the Biden Administration?

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Arent Fox

In brief: A sharp pivot toward employee- and union-friendly executive actions and legislation. Here’s what we mean.

Executive Order 13950

As we’ve reported, President Biden Revokes Executive Order 13950 | Arent Fox, on his first day in office President Biden revoked Executive Order 13950, the controversial Trump administration order that prohibited federal contractors, subcontractors, and grant recipients from providing certain workplace diversity training and programs. And, within days after that, the OFCCP dismantled Executive Order 13950 enforcement mechanisms that the Agency had only recently promulgated. The OFCCP Dismantles Executive Order 13950’s Enforcement Mechanisms (campaign-archive.com).

Wages and Hours

Ending the PAID Program

This month, the Department of Labor (DOL) announced its decision to end, immediately, the payroll audit independent determination (“PAID”) program. DOL Ends Employer-Friendly ‘PAID’ Program | Arent Fox . Launched in 2018, the program allowed employers to self-report federal minimum wage and overtime violations under the Fair Labor Standards Act (FLSA) to avoid litigation, penalties, or damages, and prohibited affected workers from pressing a private action based on the identified violations. DOL Says Employers Will Soon Get PAID | Arent Fox.

Increasing the Minimum Wage and Expanding Eligibility for Overtime Compensation

President Biden is committed to increasing the federal minimum wage to $15.00 per hour and to indexing the new minimum to the median hourly wage. Likewise, he aims to amend DOL regulations to expand greatly the number of employees entitled to be paid premium wages for overtime work.

Enforcing Prevailing Wage Standards

According to President Biden, the prevailing wage, the wage earned by the median worker in the same occupation in the same region, “is an essential mechanism for securing middle-class jobs.” Further, taxpayer dollars, he says, “should always be used to build the middle class, not to foster wage-cutting competition among employers in the construction or service industries.”

To that end, we anticipate that President Biden will press for measures to ensure that prevailing wage protections extend to all federal investments in infrastructure and transportation projects and service jobs.

Occupational Health and Safety

COVID-19 Standards and Guidance

President Biden has pledged to protect workers from COVID-19.

Ensuring the health and safety of workers is a national priority and a moral imperative. Healthcare workers and other essential workers, many of whom are people of color and immigrants, have put their lives on the line during the coronavirus disease 2019 (COVID-19) pandemic. It is the policy of my Administration to protect the health and safety of workers from COVID-19.

To that end, he has directed the Occupational Safety and Health Administration to:

  • Issue revised guidance on workplace safety during the COVID-19 pandemic.
  • Consider whether any emergency temporary standards on COVID-19, including with respect to masks in the workplace, are necessary, and issue any such standards by March 15, 2021.
  • Review OSHA’s COVID-19 enforcement efforts and identify any short-, medium-, and long-term changes that could be made to better protect workers and ensure equity in enforcement.
  • Launch a national program to focus OSHA’s COVID-19 enforcement efforts on violations that put the largest number of workers at serious risk and violations that are contrary to OSHA’s anti-retaliation principles.
  • And, coordinate with DOL’s Office of Public Affairs and Office of Public Engagement and all regional OSHA offices to conduct a multilingual outreach campaign to inform workers and the representatives of their rights under applicable law. 

In response to President Biden’s directive, OSHA has issued new guidance intended to help employers and employees, outside of healthcare, identify the risks of being exposed to and/or contracting COVID-19 at work and to help them determine appropriate control measures. (The Centers for Disease Control has issued separate guidance applicable to healthcare and emergency response settings). OSHA’s guidance contains recommendations and describes mandatory safety and health standards. Protecting Workers: Guidance on Mitigating and Preventing the Spread of COVID-19 in the Workplace | Occupational Safety and Health Administration (osha.gov).

Occupational Safety and Health: Generally

Candidate Biden declared that “[n]o one should get sick, injured, or die simply because they went to work. Every worker has the right to return home from work safely.” President Trump, according to Biden, attempted to weaken several Obama-era occupational and safety regulations.

For example, he rolled back regulations requiring companies to report their workplace injuries so they are disclosed to the public. He removed the restrictions on line speeds in pork plants, making meatpacking jobs even more dangerous. [And, h]e reduced the number of [OSHA] investigators and safety enforcement efforts, despite the fact that OSHA inspections reduce injuries.

President Biden has promised to reinstate those protections and ensure that all appointments to OSHA committees and advisory boards intimately understand the consequences of not having functional safety standards in place. Further, he has pledged to:

  • Direct OSHA to substantially expand its enforcement efforts;
  • Increase the number of OSHA and the Mine Safety Health and Administration (MSHA) investigators; and
  • Direct OSHA, the U.S. Department of Agriculture, MSHA, and other relevant agencies to develop comprehensive strategies to address the most dangerous workplace hazards.

Labor-Management Relations

The Protecting the Right to Organize Act

President Biden supports the Protecting the Right to Organize Act, which House Democrats reintroduced last week. If enacted, the bill would greatly expand employees' rights to organize, collectively bargain, and engage in protected concerted activities.

For example, to strengthen workers’ rights to engage in protected activities, the bill, among other things, would:

  • Revise the National Labor Relations Act’s (NLRA) definition of employee, supervisor, and employer to broaden the NLRA’s coverage;
  • Prohibit employers from permanently replacing strikers;
  • Prohibit offensive lockouts;
  • Make employee misclassification an unfair labor practice;
  • Remove limits on secondary picketing and strikes;
  • Prohibit employer captive audience meetings;
  • Require employers to maintain existing employment terms and conditions pending an agreement with the union;
  • Prohibit employers from withdrawing union recognition without a decertification election;
  • And, for initial collective bargaining agreements the bill would:
    • Require the employer to begin bargaining within ten days after the union submits a written request;
    • Allow either party to request mediation, with the Federal Mediation and Conciliation Service (FMCS), if the parties haven’t negotiated a contract within 90 days;
    • Authorize the FMCS to refer the matter to a three-person arbitration pane, with authority to bind the parties, if the parties fail to reach an agreement within 30 days after mediation is requested; and
    • Bar employers from requiring employees to waive their right to press work-related litigation jointly, collectively, or as a class.

To “ensure fairness” in union representation elections, the bill would, among other things:

  • Prohibit employers from gerrymandering a bargaining unit to include individuals who have no interest in joining the union;
  • Permit petitioning employees to choose whether the election will be conducted electronically, by certified mail, or at another location apart from the employer’s premises;
  • Require the NLRB to issue a bargaining order if the union loses a representation election due to employer interference; and
  • Codify the NLRB’s long-standing “recognition bar”, “successor bar”, “remedial bargaining unit bar”, “contract bar”, and “blocking charge” doctrines.

To prevent unfair labor practices, the bill would, among things:

  • Authorize the NLRB to award backpay, front pay, consequential damages, and liquidated damages equal to twice the damages awarded, to employees, including undocumented aliens, who have been discharged or have suffered serious economic harm in violation of the NLRA; and
  • Authorize the NLRB to seek, and the US District Courts to issue, temporary injunctive relief if there is a reasonable basis to believe that an employer has unlawfully terminated an employee or significantly interfered with his or her NLRA rights.

To protect the right to strike, the bill would amend the NLRA to make clear that the “duration, scope, frequency, or intermittence of any strike or strikes shall not render them unlawful.”

And to allow employers and labor organizations to finesse state right-to-work laws, the bill would authorize labor and management to agree to require bargaining unit employees who are not union members to pay a “fair-share fee” to cover the costs of collective bargaining and contract administration.

State Right-to Work Laws

President Biden objects to state laws that prohibit unions from collecting dues or comparable payments from everyone in a bargaining unit. Those laws, according to the President, “exist only to deprive unions of the financial support they need to fight for higher wages and better benefits”. Thus, we expect him to ask Congress to repeal the Taft-Hartley Act provisions that permit them.

Cabinet-Level Working Group

We anticipate that President Biden will make good on his campaign promise to establish, within his first 100 days in office, a cabinet-level working group focused on promoting public and private sector union organizing and collective bargaining. We believe that he will task the group with delivering a plan to “dramatically increase union density and address economic inequality”. It will assess whether there are specific areas in which the federal government could waive NLRA preemption, to allow cities and states to increase union organizing and collective bargaining without undermining current worker protections, like allowing for neutrality agreements and card check. Also, the group will explore ways to expand sectoral bargaining, with all competitors in an industry engaged in collective bargaining with a single or multiple unions.

Extending the Right to Organize and Bargain Collectively to Independent Contractors

As a candidate, Biden promised to extend the right to organize and bargain collectively to independent contractors. “Some workers”, he explained, “are correctly classified as independent contractors, but are not very different from employees.”

They bring only their labor, and perhaps a small amount of capital investment, to the organization with which they do business. These workers lack individual bargaining power and, as a result, are at grave risk of exploitation by big business.

President Biden supports modifying antitrust law and guaranteeing that these independent contractors may organize and bargain collectively for their mutual protection and benefit.

Combatting Employee Misclassification

We expect President Biden to pursue aggressively employers that violate labor laws, participate in wage theft, or cheat on their taxes by intentionally misclassifying employees, including “gig workers,” as independent contractors.

As president, Biden will put a stop to employers intentionally misclassifying their employees as independent contractors. He will enact legislation that makes worker misclassification a substantive violation of law under all federal labor, employment, and tax laws with additional penalties beyond those imposed for other violations. And, he will build on efforts by the Obama-Biden Administration to drive an aggressive, all-hands-on-deck enforcement effort that will dramatically reduce worker misclassification. He will direct [the DOL] to engage in meaningful, collaborative enforcement partnerships, including with the National Labor Relations Board (NLRB), the Equal Employment Opportunity Commission, the Internal Revenue Service, the Justice Department, and state tax, unemployment insurance, and labor agencies. And, ... Biden will fund a dramatic increase in the number of investigators in labor and employment enforcement agencies to facilitate a large anti-misclassification effort.

We anticipate, therefore, that he will press Congress to pass laws modeled after California’s three-pronged “ABC test”, California Rules 'ABC' Independent Contractor Test Applies Retroactively | Arent Fox, to distinguish between employees and independent contractors. Adopting that test, almost certainly will sweep many more workers into the employee ranks.

Federal Contracting

We anticipate that President Biden will launch an array of pro-employee and pro-union initiatives aimed at federal contractors.
For example, we expect him to promote multi-year federal debarment for all employers that illegally oppose unions, building on debarment initiatives that President Obama pursued. Likewise, we expect him to restore and build on the President Obama’s Fair Pay and Safe Workplaces executive order, requiring contracting agencies to take employer compliance with labor and employment laws into account when determining whether they are sufficiently responsible to be entrusted with federal contracts.

President Biden, we also believe, will take steps to ensure that federal contracts only go to employers who sign neutrality agreements, committing not to run anti-union campaigns. And, we anticipate that he will adopt measures to award contracts only to employers who “support their workers”, such as by paying them a $15 per hour minimum wage and offering “family sustaining benefits”.

Eliminating Non-Compete Clauses and No-Poaching Agreements

According to Candidate Biden, non-compete clauses and no-poaching agreements unfairly encumber competition.

In the American economy, companies compete. Workers should be able to compete, too. But at some point in their careers, 40% of American workers have been subject to non-compete clauses. If workers had the freedom to move to another job, they could expect to earn 5% to 10% more – that’s an additional $2,000 to $4,000 for a worker earning $40,000 each year. These employer-driven barriers to competition are even imposed within the same company’s franchisee networks. For example, large franchisors like Jiffy Lube have no-poaching policies preventing any of their franchisees from hiring workers from another franchisee.

Thus, we anticipate that President Biden will press Congress to (1) eliminate all non-compete agreements, except for those deemed necessary to protect a narrowly defined category of trade secrets; and (2) ban all no-poaching agreements.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Arent Fox | Attorney Advertising

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