Labor and Employment Law: A Review of 2013 and a Preview of 2014

In the labor and employment law world, 2013 was a year of contrasts.  Congress displayed record idleness with respect to passing or updating legislation.  The Senate, on the other hand, busily confirmed a slew of Obama appointees.  And, unlike Congress, the federal regulatory agencies marched ahead with a number of new interpretations and regulations.

As you will see, we can probably expect a continuation of this trend in 2014: Congressional lethargy paired with regulatory bustle.  Meanwhile, the White House will likely continue to focus its energies on implementing the Affordable Care Act.

Congressional Inaction in 2013

Congressional inaction in 2013 was felt in the employment sphere.

  • Congress failed to extend long-term unemployment benefits—which expired on December 28—before it adjourned for 2013.  The expiration of long-term unemployment benefits means that Congress will likely vote on this important issue early in 2014.
  • Congress also neglected to replace and improve the current Pension Protection Act of 2006. This legislation sunsets at the end of 2014.  Similarly, Congress did little in 2013 to reform the significantly underfunded multiemployer defined pension system.
  • Given the gridlock in the House of Representatives, it does not seem likely that Congress will pass the Employment Non-Discrimination Act (ENDA) in the coming year.  It also seems doubtful that Congress will approve an increase in the federal minimum wage, although Congressional Democrats will likely push for a vote on the issue.

Pro-Union Appointments of 2013

Congressional inaction, however, did not extend to the Senate’s labor and employment related appointment confirmations.

  •  In July 2013, the Senate confirmed all five candidates to the National Labor Relations Board (NLRB) as well as the NLRB General Counsel.  The current complement of Board members is expected by many observers to demonstrate a pro-union approach to labor law.
  • This past July, the Senate also confirmed Thomas Perez as the Secretary of Labor.  While in the Justice Department, Perez aggressively enforced civil rights laws.  It is expected that Perez will also walk a pro-union line in his leadership of the Department of Labor (DOL).
  • Additionally, since May 2013, the Senate has confirmed three of President Obama’s appointments to the D.C. Circuit Court of Appeals.  The Senate is expected to confirm a fourth Obama appointment to the D.C. Circuit in the near future.  The confirmation of these new judges represents a shift in the balance of active judges on the D.C. Circuit to a Democratic majority, which might result in more pro-union decisions in the years to come.

Federal Regulatory Highlights of 2013

Unlike Congress, federal regulatory agencies were busy in 2013.

  • The Office of Federal Contract Compliance Programs (OFCCP) of the DOL issued proposed regulations that require federal contractors to advance hiring and employment goals for veterans and the disabled.  Section 503 of the rule introduces a hiring goal for federal contractors and subcontractors that 7% of each job group in their workforce consist of qualified individuals with disabilities.  Under the rule, federal contractors are also required to adopt a benchmark to measure their recruitment and employment of veterans based on the national percentage of veterans in the workforce (8% currently) or based on the contractors’ own analysis of the best available data.
  • The Wage and Hour Division (WHD) of the DOL continued work on its proposed “Right to Know” regulation, which would require employers to disclose to its workers their status either as employees or independent contractors.
  • Through an interpretive letter, the DOL’s Occupational Safety and Health Administration (OSHA) approved walk around rights of outside union organizers to accompany OSHA inspectors during workplace safety and health investigations.

Regulations to Watch in 2014

DOL’s Revised Interpretation of the LMRDA “Advice Exemption”

  • In March 2014, the DOL expects to issue a final interpretation narrowing the advice exemption to the Labor–Management Reporting and Disclosure Act (LMRDA).  The proposed interpretation could impose additional disclosure requirements on lawyers and law firms.
  • The LMRDA requires employers and legal consultants to report any arrangement to directly or indirectly persuade employees concerning union organizing, collective bargaining, strikes, and other forms of concerted activity.  The LMRDA currently exempts from public disclosure and reporting requirements advice submitted to an employer in written or oral form that the employer is free to accept or reject.  The proposed interpretation would significantly narrow the definition of advice.  As such, law firms and consultants would have to report a broad range of activities that the proposed regulation defines as persuader activities, including the preparation of any written or electronic material for presentation or distribution to employees, the drafting of speeches, the provision of supervisor or employer representative trainings, and the coordination of employer efforts to persuade employees.
  • The American Bar Association (ABA), the Association of Corporate Counsel (ACC), and the Society for Human Resources Management (SHRM) have all strongly opposed the DOL’s new interpretation of the advice exemption.  As the ABA has argued, the new reporting requirements are inconsistent with both the statutory language of the LMRDA and the rules of professional conduct pertaining to lawyer–client confidentiality.

NLRB’s Union Representation Election Rules

  • Over the past several years, the NLRB has attempted to facilitate “quickie” union representation elections.  Quickie elections favor unions because they allow for less time between when a union files for an election petition and the actual date of the election.  This condensed time frame curtails the ability of employers to litigate pre-election issues such as voter eligibility and the composition of the bargaining unit.
  • In 2012, the U.S. District Court for the District of Columbia set aside several of the NLRB’s contemplated rule changes designed to expedite quickie elections.  The NLRB has since withdrawn its appeal of the district court’s decision.  Nonetheless, the NLRB is still intent on issuing new quickie election rules.  Watch for the NLRB to reissue an even more pro-union set of quickie election rules in 2014.

OSHA’s Proposed Rule on Injury and Illness Prevention Programs

  • OSHA is in the early stages of drafting a rule requiring employers to develop injury and illness prevention programs.  According to OSHA, injury and illness prevention programs would assist employers in identifying workplace hazards and developing a process to fix those hazards.  OSHA has identified the proposed injury and illness prevention program as its current highest rulemaking priority and intends to issue a proposed rule on the issue in September 2014.

OSHA’s Proposed New Rule on Silica Exposure

  • OSHA published a proposed new rule on silica exposure on August 23, 2013.  Public comments on the proposed rule are due on January 27, 2014.  The proposed rule reduces the permissible exposure level to crystalline silica—which encompasses quartz, cristobalite, and tridymite—and establishes new requirements for exposure assessment, exposure-controlling methods, respiratory protection, medical surveillance, hazard communication, and record-keeping.  Construction and hydraulic fracturing workers are often exposed to crystalline silica; as such, these industries will be significantly affected by OSHA’s proposed rule.  OSHA has not yet provided an estimate on when it expects to publish a final rule on silica exposure.

The Main Focus of 2014: The Affordable Care Act (ACA or Obamacare)

  • Efforts throughout 2013 by the House of Representatives to repeal or modify the ACA met a recalcitrant Senate.  So, with an effective date of January 1, 2014, for non-delayed or deferred provisions, the ACA will continue to be implemented.
  •  Importantly, however, the U.S. Treasury Department announced on July 2, 2013, that the ACA’s employer “pay-or-play” mandate would be delayed until 2015.  The mandate will subject employers to penalties for failing to offer full-time employees healthcare coverage that is “affordable” and meets certain minimum standards.
  • The troubled roll-out of the federal health insurance website does not portend well for the smooth implementation of other aspects of the ACA.  Most notably, even organized labor, a formerly staunch advocate for the ACA, expressed frustration at the ACA’s potential impact on union-controlled health-insurance plans (i.e., Taft–Hartley plans).  To mollify the unions, the Obama administration issued a proposed rule that would exempt, starting in 2015, Taft–Hartley plans from the ACA’s reinsurance tax on self-insured health-care plans.
  • Expect the Obama administration to devote most of its attention in the coming year to the continued rollout of the ACA.