Category Archives: Department of Labor

Is One Watchdog Better Than Two?

The Trump administration wants to combine the Equal Employment Opportunity Commission with another federal watchdog agency—and both worker and business groups are worried.

The issue got attention on Wednesday as new Secretary of Labor Alexander Acosta testified before a House subcommittee about how President Trump’s proposed budget will affect his department.

Among other proposals that would cut Labor department spending by 20 percent overall, Trump’s budget also proposes merging the department’s Office of Federal Contract Compliance Programs into the EEOC, an independent agency.

Acosta told skeptical Democrats on the panel that the merger made “common sense” and would not hurt workers, the Associated Press and other news organizations reported.

Off Capitol Hill, the merger idea has drawn fire from communities that often disagree—business leaders and worker-rights advocates. The Leadership Conference on Civil and Human Rights, a coalition that includes labor unions, the ACLU and others, wrote the administration and Congress on May 26 that the merger would effectively shutter the OFCCP by folding it into the EEOC.

“Both OFCCP and EEOC help advance and protect equal employment opportunity, but they are distinct in their enforcement approaches and expertise, and they should remain separate,” said Leadership Conference CEO Wade Henderson in a prepared statement. “We strongly urge Congress to reject this proposal, which would lead to an erosion of key civil-rights protections for working people.”

Though the merger idea got an early boost from the business-friendly Heritage Foundation, some corporate leaders agree with critics that the agencies should remain separate. Some, including the U.S. Chamber of Commerce, fear the merger would create a mega-regulator with too much power.

”There is a fear in the business community that this newly formed grouping might result in the worst of all worlds from both agencies,” said Randy Johnson, a chamber senior vice president, in a prepared statement. He noted that the EEOC has legal powers the OFCCP does not.

Report Targets Walmart Policies

Walmart’s absence control program “punishes workers who need to be there for their own families,” according to a new report released late last week.

The report, “Pointing Out: How Walmart Unlawfully Punishes Workers for Medical Absences,” was produced by A Better Balance, an advocacy group that supports legislators across the nation in “researching, drafting and testifying on behalf of bills to help workers care for themselves and their families without risking their paychecks,” according to its website.

“Walmart disciplines workers for occasional absences due to caring for sick or disabled family members and for needing to take time off for their own illnesses or disabilities,” the report states.

“Although this system is supposed to be ‘neutral,’ and punish all absences equally, along the lines of a ‘three strikes and you’re out’ policy,” the report continues, “in reality such a system is brutally unfair. It punishes workers for things they cannot control and disproportionately harms the most vulnerable workers.”

The group based its findings of alleged illegal behavior at the superstore chain on conversations with Walmart employees as well as survey results of over 1,000 current and former Walmart workers who have struggled due to Walmart’s absence control program.

“Walmart may regularly be violating the federal Family and Medical Leave Act (FMLA) by failing to give adequate notice to its employees about when absences might be protected by the FMLA and by giving its employees disciplinary points for taking time to care for themselves, their children, their spouses or their parents even though that time is covered by the FMLA,” the report states.

In response, Walmart told the New York Times that it had not reviewed the report but disputed the group’s conclusions, and said that the company’s attendance policies helped make sure that there were enough employees to help customers while protecting workers from regularly covering others’ duties.

“We understand that associates may have to miss work on occasion, and we have processes in place to assist them,” Randy Hargrove, a spokesman for Walmart, said. The company reviews each employee’s circumstances individually, he said, “in compliance with company policy and the law.”

Downsizing the DOL

As many expected, the Department of Labor didn’t escape President Trump’s 62-page budget plan (released yesterday) unscathed. But the extent of the proposed cutbacks should certainly raise a few eyebrows.

On a percentage basis, the DOL tied the Agriculture Department for third place on the list of agencies being targeted for biggest cutbacks (with a 21-percent decrease), just behind the Environmental Protection Agency (31.4-percent decrease) and the State Department (28-percent decrease).

From a dollar standpoint, under the plan, the proposed DOL budget would be slashed by $2.5 billion—to $9.6 billion.

So how will the DOL find these savings?

The budget plan points to areas such as job-training grants, Bureau of International Labor Affairs’ grant funding, the closing of Job Corps centers, the elimination of less-critical technical-assistance grants from the Office of Disability Employment Policy, and Occupational Safety and Health Administration’s training grants. In many of the cases, the administration’s hope is to shift more of the burden onto the shoulders of the states.

But as Washington-based Seyfarth Shaw Senior Counsel Larry Lorber pointed out yesterday in a phone interview, the cited cuts (some with dollar figures attached to them, others without) won’t get the DOL close to its $2.5 billion goal.

“There’s a big gap between the cutbacks announced and $2.5 billion,” Lorber said. “So the big question is, where are you going to make up the difference?”

Lorber said it’s ultimately going to have to come from salaries and expenses. He specifically pointed to the Wage and Hour Division and OSHA as possible candidates, since salaries and expenses make up a substantial part of their overall budgets.

So what does this all mean for employers?

Well, for starters, Lorber said, staff and travel cutbacks at entities such as WHD and OSHA are inevitably going to translate into less enforcement. Many employers, he suggested, may very well welcome the fact that if travel is reduced, enforcement isn’t going to happen.

But, he added, some employers aren’t going to be pleased to see many of the training programs and grants go away, as is being proposed. (The plan specifically proposes the elimination of the Senior Community Service Employment Program, which transitions low-income unemployed seniors into unsubsidized jobs—calling the program “ineffective.”) Lorber said it’s not likely that states are going to pick up the slack here.

Things, of course, can certainly change between now and when a more detailed budget makes its way through Congress. But it’s probably safe to expect that R. Alexander Acosta — assuming he is confirmed as Secretary of Labor — is going to have a fairly downsized department to work with as performs his duties. (Acosta’s confirmation hearings are now scheduled to begin on March 22.)

Sacrificing Safety or Creating Jobs?

The fate of an Obama-era piece of legislation designed to improve worker safety appears to be anything but safe.

On Monday, the U.S. Senate voted by the slimmest of margins—49 to 48—to eliminate the Fair Pay and Safe Workplaces rule, which was created to “limit the ability of companies with recent safety problems to compete for government contracts unless they agreed to remedies,” as the Washington Post reported this week.

Signed by then-President Barack Obama on July 31, 2014, the executive order required prospective federal contractors bidding on federal deals worth more than $500,000 to disclose their violations of certain workplace protection laws before receiving a contract. The rule also obligated federal agencies to work with noncompliant contractors in an effort to address existing safety-related issues.

The regulation was put on hold, however, by an October 2016 court order determining that it exceeded congressional limits. A measure to abolish it has since made it through the House, and this week’s Senate vote all but assures that will now happen. President Donald Trump is expected to sign off on rolling back the rule—just one of a handful of worker safety regulations the administration is eyeing for elimination.

“This is the opening salvo of the Republicans’ war on workers,” Deborah Berkowitz, senior policy adviser at OSHA, told the Post. “It sends a signal that Congress and the administration is listening to big business and their lobbyists and they are not standing up for the interests of the American workers.”

Meanwhile, groups such as the U.S. Chamber of Commerce and the Business Roundtable contend that the Fair Pay and Safe Workplaces rule hampers businesses’ ability to compete for government contracts, which subsequently reduces jobs.

“Any changes in employment laws proposed by the employer community [are] disingenuously described [by Democrats] as an attack on workers,” Randy Johnson, the U.S. Chamber’s senior vice president for labor, immigration and employee benefits, told the Post. “The left has never seen a regulation they don’t like, no matter how many jobs it kills.”

Sen. Elizabeth Warren (D-Mass.) doubts that the motives behind wiping out this particular rule have much to do with saving or generating jobs.

“Instead of creating jobs or raising wages, they’re trying to make it easier for companies that get big-time, taxpayer-funded government contracts to steal wages from their employees and injure their workers without admitting responsibility,” she said in a Senate floor speech ahead of Monday’s vote.

As the Post points out, the eradication of the Safe Workplaces rule is likely just the first phase of a Congressional movement to “kill Labor Department regulations.”

The “Volks rule,” for instance, could be next.

Adopted in January, the rule was meant to “give OSHA authority to issue citations and levy fines against companies for failure to record illnesses, injuries and deaths that date back as far as five years,” according to the paper.

U.S. Representative Bradley Byrne (R-Ala.) has introduced a measure that would do away with the rule, which he has described as an overreach.

“If you are determined to be a bad actor, you’ll be a bad actor,” Byrne told the Post. “I don’t think this is going to encourage noncompliance. I think OSHA is being lazy on getting its investigations done.”

For their part, Congressional Democrats maintain that rejecting the rule would undermine OSHA’s efforts to enforce safety reporting requirements.

For example, Rep. Robert C. Scott, of Virginia, says doing so would “create a safe harbor for those employers who deliberately underreport.”

The arguments coming from both sides of the aisle with respect to such workplace-related regulations are nothing new, and are sure to continue. But it seems every bit as certain that we’re going to find out what sort of impact taking these rules away will have on workplace safety.

DOL Wants to Delay Fiduciary Rule

The U.S. Dept. of Labor is seeking to delay the implementation of a rule that is intended to protect the best interests of retirement savers but has drawn the ire of many in the financial-services sector. The fiduciary rule, which would apply the “fiduciary standard” to all those who provide retirement investment advice in order to prevent conflicts-of-interest (which the Obama administration’s Council of Economic Advisers said costs retirement savers $17 billion a year), was set to go into effect on April 10. The DOL is seeking a 60-day delay of the rule, to June 9. The proposed delay (which is itself a new rule) will have a 15-day public comment period ending on March 17.

President Donald Trump expressed his concerns about the fiduciary rule in a memo issued on Feb. 3, in which he directed the DOL to examine the rule and “determine whether it may adversely affect the ability of Americans to gain access to retirement information and financial advice.” It directed the DOL to propose a new rule “rescinding or revising” the fiduciary rule if it determines that the regulation is likely to harm investors by limiting their access to certain financial products or services and cause an increase in litigation.

The Financial Services Roundtable, a lobbying group, issued a statement praising the delay. “The fiduciary rule will lead to fewer retirement savings choices for many Americans and we are encouraged the DOL is proposing to delay the rule.”

However, Lisa Donner, executive director of Americans for Financial Reform, told the Los Angeles Times that the delay is merely a preamble to the Trump administration’s plan to ultimately scrap the rule.

“Blocking the common-sense, long-overdue rule, which requires retirement advisors to act in their customers’ best interests, would allow Wall Street to continue to grab more than $17 billion a year —  tens of millions of dollars a day —  from retiree savings,” she said. “This decision is not justified by the facts, and it is a betrayal of the public interest.”

The Democratic Party Platform: A Cheat Sheet

ThinkstockPhotos-476244660Turnabout is fair play — at least when it comes to politics in 2016. Last week I gave you a rundown on HR-related provisions in the Republican Party platform. Now it’s time for the Democrats.

Reflecting the unusual character of this year’s race, the document — formally approved on Monday — contains many direct attacks on GOP candidate Donald J. Trump. In some cases the narrative has to stretch a bit to do so. In declaring the party’s support for small business, for example, the platform says:

“The Democratic Party will make it easier to start and grow a small business in America, unlike Donald Trump, who has often stiffed small businesses—nearly bankrupting some—with his deceptive and reckless corporate practices.”

Anyway. Back to HR. Following are the main provisions of interest.

Minimum Wage: Language in the platform on the federal minimum wage reflects some tension between the party and Hillary Clinton’s presidential campaign. Clinton favors a raise from $7.25 an hour today to $12, leaving states and cities to set higher minimums. Her now-vanquished rival, Bernie Sanders, pushed for $15. What emerged in final platform language was a compromise: $15 … “over time.” The party also calls for eliminating minimum-wage exemptions for tipped workers and those with disabilities.

“No one who works full time should have to raise a family in poverty. … We should raise the federal minimum wage to $15 an hour over time and index it [to inflation].”

Employer incentives: The party also favors federal support for employers who “provide their workers with a living wage, good benefits, and the opportunity to form a union without reprisal.” The language doesn’t specify the form of this support, but suggests such employers would get preference in existing programs.

“The one trillion dollars spent annually by the government on contracts, loans, and grants should be used to support good jobs that rebuild the middle class.”

‘Card Check’: The platform reiterates a long-held argument in favor of allowing unions to organize workplaces where a majority of workers have signed cards indicating approval — with no election. The idea, called “card check,” has been proposed in Congress for more than a decade, so far without success.

The provision is part of a larger argument the party makes in favor of stronger legislative and regulatory support for labor unions.

“A major factor in the 40-year decline in the middle class is that the rights of workers to bargain collectively for better wages and benefits have been under attack at all levels. … We oppose legislation and lawsuits that would strike down laws protecting the rights of teachers and other public employees. We will defend President Obama’s overtime rule, which protects of millions of workers by paying them fairly for their hard work.”

Mandatory Arbitration: Federal regulators have been going after companies that require workers to sign arbitration agreements that waive their rights to sue or join class-action suits. The topic got a big boost this month with news that former Fox News chairman Roger Ailes is citing such a clause in the contract of former Fox commentator Gretchen Carlson to keep her sexual-harassment lawsuit out of court.

The 2016 platform adds the cause to a list of labor measures.

“We will support efforts to limit the use of forced arbitration clauses in employment and service contracts, which unfairly strip consumers, workers, students, retirees, and investors of their right to their day in court.”

Paid leave: After a passing reference to the party’s support for gender-based pay equity, the Democratic Party platform gets more specific about laws that would mandate family and medical leave.

“Democrats will make sure that the United States finally enacts national paid family and medical leave by passing a family and medical leave act that would provide all workers at least 12 weeks of paid leave to care for a new child or address a personal or family member’s serious health issue. We will fight to allow workers the right to earn at least seven days of paid sick leave. We will also encourage employers to provide paid vacation.”

Profit-sharing: Suggesting a program that may appeal to some employers, the party also backs an unspecified government incentive to some that provide profit-sharing bonuses to employees.

“Corporate profits are at near-record highs, but workers have not shared through rising wages. … we will incentivize companies to share profits with their employees on top of wages and pay increases, while targeting the workers and businesses that need profit-sharing the most.”

International trade: Trade policy is a sore subject for both parties, with Trump and Sanders railing against NAFTA and the proposed Trans-Pacific Partnership. The Democratic Party platform walks a narrow line, calling for tougher bargaining — without shutting the door on the TPP.

“Trade agreements should crack down on the unfair and illegal subsidies other countries grant their businesses at the expense of ours. … These are the standards Democrats believe must be applied to all trade agreements, including the Trans-Pacific Partnership.”

Immigration: The 2016 party platform reaffirms longstanding calls for comprehensive immigration policy reform — but makes no mention of increasing employment-based visa allowances to help companies recruit talent abroad.

“Democrats believe we need to urgently fix our broken immigration system—which tears families apart and keeps workers in the shadows—and create a path to citizenship for law-abiding families who are here, making a better life for their families and contributing to their communities and our country.”

A Real Account of Long-Term Unemployment

It’s been awhile since we’ve reported on efforts to solve the nation’s long-term-unemployment problem. (Here are our HRE Daily posts 505475762 -- unemployment2and here are our HREOnline.com news analyses examining the problem and what can and should be done about it.)

Just recently, though, I came across an interesting write-up on the U.S. Department of Labor site about a panel discussion that was held in New Brunswick, N.J., on the topic.

The panelists, themselves, caught my eye: DOL Secretary Thomas E. Perez was leading the long-term-unemployment discussion, joined by former N.J. Gov. Jim Florio and U.S. Rep. Frank Pallone, D-New Jersey’s 6th District. Those who attended shared story after story of “devastation as they continue to look for employment to support their families,” the write-up says.

Which gets me to what was most interesting about the DOL release: the write-up and writer, themselves. Kevin Meyer, a public-affairs specialist at the DOL, wrote mostly about himself in response to what attendees were sharing. In his words,

“Those stories felt too familiar. In January 2014, I was one of the nation’s then nearly 3.6 million long-term unemployed. I was 52 and had spent two of the previous three years jobless. The great recession hit everyone hard, but older workers like me had a particularly tough time bouncing back.

“Even now as the overall unemployment rate [falls] below 5 percent for the first time since 2008, more than 2 million people have been out of work for more than six months. Today, the typical duration of unemployment for workers between 45 and 64 is still about a month longer than it is for younger workers.

“Ask someone — a relative, friend or neighbor — who is unemployed at this age, you hear the same things. Endless applications, unreturned calls, useless job searches, financial losses, anger, guilt and fear.”

Although he goes on, and in great detail, to tell his own harrowing story of being in the long-term-unemployed ranks for years before coming to the DOL’s Office of Public Affairs, he does also mention his agency’s Ready to Work grants — where and how well they’re working — and the fact that Perez had come to hear about New Jersey’s success with them.

But most of what he shared was impressive and moving, and I commend him for taking this tack. Full disclosure: Perez did ask Meyer to share his story at the roundtable. But he didn’t have to write it all down — which he did and did well. Case in point:

“Like those I met [in a previous roundtable on long-term unemployment, held in Washington, with Perez presiding there as well], I was desperate. I was fearful for my family; knowing that I would soon lose my home without more than another temporary job.

“I introduced myself and shared my work history of two decades as a writer and communications professional. My words then turned blunt, in typical New Jersey fashion. ‘Mr. Secretary, I must tell you that I battled an aggressive form of cancer into remission in 2006. As difficult as my cancer was, long-term unemployment has been worse,’ I shared, in a hushed conference room, trying to bury my emotion. ‘If I failed to beat cancer, my family had my company insurance and would have been cared for. If I fail to beat unemployment, I will leave them with nothing.’ “

We sometimes forget — as we write and read about joblessness, and unemployment rates, and layoffs, and older workers out of work — that for every number, there is a person there, struggling through pieces of a life event we will never know unless we go through it ourselves.

Thanks to a very different kind of press release, a tiny window was opened here, at least for me. For any employer hesitant to hire someone from these ranks, I’d say this is a must-read.

DOL Gives a Holiday Gift to Parents

I’m not usually one for repeating content here one week to the next, but I simply had to share news of this pretty sizable gift while we’re all in the midst 510042321-- parents & newbornof the gift-giving season.

In an announcement last Thursday, the U.S. Department of Labor put significant money — up to $25 million in grants — where President Obama’s mouth has been in his support of working families struggling with today’s workforce realities.

Essentially, the grants will support public-private partnerships that bridge gaps between local workforce-development and child-care systems. Funded programs will enable parents to access training and customized support services needed for jobs primarily in information technology, healthcare and advanced manufacturing, though not necessarily confined to just those three.

The money, according to the DOL, will become available to these partnerships beginning in the spring and will be aimed at helping parents obtain affordable, quality child care so they can “pursue education and training opportunities leading to good jobs in growing industries.”

As U.S. Secretary of Labor Thomas E. Perez puts it in his announcement of the initiative:

“For too many working parents, access to quality, affordable child care remains a persistent barrier to getting the training and education they need to move forward on a stronger, more sustainable career path. Our economy works best when we field a full team. That means doing everything we can to provide flexible training options and streamlined services that can help everyone in America realize their dreams.”

This move by the government certainly underscores the attention employers and work/life experts have been paying to the needs of working parents lately. A search of this HRE Daily site, starting with my post last week lamenting the slow motion paternity leave seems to be in, along with this search of our parental-leave news analyses on our magazine’s HREOnline site, shows this push — some might even call it competition — by organizations to prove they’re family-friendly will be a hot agenda item heading into 2016.

Hopefully, employers and government agencies can come together and really start engaging in a national dialogue as opposed to each entity trying to outdo the other.

This move by the DOL seems to be a step toward that coming-together idea. It stipulates that grants up to $4 million will be awarded to partnerships that include the public workforce system, education and training providers, business entities and local child-care or human-service providers; more importantly, the release states, “all partnerships must include at least three employers.”

Personally, if this truly does lead to my kids, and my kids’ kids, having more at their fingertips than I did to survive the chaos of young parenthood coupled with work and the constant struggle to get ahead, then the gift is for me too.

DOL Mandates Pay Transparency

moneyOn the heels of President Obama’s recent executive order requiring federal contractors to provide at least seven days of paid sick leave, the Department of Labor’s Office of Federal Contract Compliance Programs today issued a final rule banning federal contractors from having policies that discourage their employees from discussing, disclosing or inquiring about their own pay or that of their co-workers.

The final rule implements Executive Order 13665, signed by the president last year, which stems from the Lily Ledbetter Fair Pay Act.

“It is a basic tenet of workplace justice that people be able to exchange information, share concerns and stand up together for their rights,” said DOL Secretary Thomas Perez in a statement. “But too many women across the country are in the same situation: They don’t know how much they make compared to their male counterparts, and they are afraid to ask.”

A “culture of secrecy” around pay keeps women from knowing they are underpaid and makes it difficult to enforce equal pay laws, according to the DOL. Women still earn only 23 cents for every dollar earned by male employees, the agency says.

The rule allows job applicants and employees of federal contractors and subcontractors to file a discrimination complaint with the OFCCP if they believe that their employer fired or otherwise discriminated against them for discussing, inquiring about or disclosing their own compensation or that of others.

Pay transparency benefits companies as well as employees, said OFCCP Director Patricia Shiu.

“Indeed, forward-thinking companies that have embraced greater transparency find that it benefits them and their workforce by helping them attract and retain talented workers,” she said.

The rule will go into effect 120 days after its publication in the Federal Register.

The Feds’ War on Employee Misclassification

Seeking to clarify the issue of just what it is that distinguishes an independent contractor from an employee, the Department of Labor yesterday  issued its first Administrator’s Interpretation (AI) of the issue as it pertains to the Fair Labor Standards Act. The issue has only grown more heated in recent months with the rise of “gig economy” companies such as Uber and Lyft, along with long-running disputes between companies and workers such as FedEx Ground’s dispute with its drivers, who claim they were misclassified as independent contractors.

Written by the DOL’s Wage and Hour Division Administrator, David Weil, the 15-page memo states that the misclassification of employees as independent contractors “is among the most damaging to workers and our economy.” It emphasizes the WHD’s six-factor economic realities test that’s used to determine a worker’s status along with what a just-released briefing from law firm Seyfarth Shaw describes as “an extremely expansive reading of the FLSA’s ‘suffer or permit to work’ definition of ’employ.'”

“Combined,” the Seyfarth Shaw briefing says, “WHD’s efforts indicate a significant hostility towards the use of independent contractors.”

An agreement between an employer and a worker stating that the worker is an independent contractor “is not indicative of the economic realities of the working relationship and is not relevant to the analysis of the worker’s status,” Weil’s memo states. The true measure of whether a worker is an employee or an independent contractor, Weil writes, is the extent to which the worker is economically dependent on the employer. A worker who is really in business for him-or-herself is an independent contractor, he notes; a worker who is economically dependent on the company is an employee.

Weil’s AI serves as a reminder to employers to regularly question their independent-contractor classifications as a part of their global risk audits, writes Michael Droke, a partner in the labor and employment division of Dorsey and Whitney. They should also be keeping records on the process used to determine whether one is an independent contractor or employee, and ensure that those classified as independent contractors aren’t given rights or access that may call their status into question, he writes: “For example, contractors should not have internal email accounts, should not be given server access, and should not be invited to employee functions.”

Weil’s AI is yet one more piece of evidence that the federal government is aggressively seeking out employers that misclassify (either deliberately or by mistake) employees as independent contractors and that businesses must proceed very carefully in this area, according to the Seyfarth Shaw memo.

“The guidance now makes it likely that DOL investigations and enforcement actions and private litigation contesting the classification of such workers will intensify,” the Seyfarth Shaw attorneys write. “Businesses should, therefore, carefully evaluate the DOL’s guidance and its potential impact on their operations.”