While controversies over the first nominee for Secretary of Labor slowed implementation of the Trump administration’s labor agenda during the first 100 days of the president’s term, construction industry leaders are already seeing a sharp contrast with the anti-business agenda of the Obama administration, as federal labor agencies have begun to review and in some cases retract burdensome regulations imposed by previous officials. 

On April 27, 2017, the U.S. Senate confirmed Republican lawyer Alex Acosta as the first Secretary of Labor in the Trump administration. Acosta is a former member of the National Labor Relations Board (NLRB) and U.S. Attorney in Miami, and he most recently served as dean of the Florida International University College of Law. Acosta stated at his Senate confirmation hearing that he would begin his tenure by complying with Trump’s executive orders requiring all executive agencies to review burdensome regulations to consider ways to reduce adverse impacts on businesses. 

Associated Builders and Contractors (ABC) and industry partners have succeeded in blocking several holdover Obama initiatives in the federal courts and anticipate significant regulatory reform in this administration.

Congress Nullifies Blacklisting Regulations Previously Blocked By ABC Federal Lawsuit 
In October 2016, a federal judge in Texas issued a preliminary injunction requested by ABC that blocks Obama’s “Fair Pay and Safe Workplace” regulation, otherwise known as the “blacklisting” rule, from taking effect. The blacklisting rule would have forced most federal contractors to publicly declare themselves to be labor law “violators” and be subjected to intensive and burdensome reviews by procurement officials. 

The federal judge declared the Obama rule to be unconstitutional and arbitrary in its treatment of government contractors as labor law violators without any final adjudications or due process of law. 

In March, Congress voted to “disapprove” the blacklisting rules under the Congressional Review Act, and Trump rescinded Obama’s executive order. These actions permanently nullified the rules and will prevent future administrations from initiating any similar rules.

Battles Continue Over Government-Mandated PLAs
ABC continues to lead the fight against efforts to impose government-mandated project labor agreements (PLAs) on taxpayer funded projects and is hopeful that the Trump administration will act in favor of fair and open competition in the construction industry—especially on promised infrastructure improvement projects.  
At this writing, Trump is expected to sign an executive order rescinding President Obama’s 2009 order that encouraged government-mandated PLAs on federal construction projects. However, the full scope of Trump’s position on PLAs has yet to be determined. 

Meanwhile, 23 states already have prohibited state government entities from forcing contractors to sign PLAs as a condition of performing work on public construction projects. More state governments are expected to sign similar PLA neutrality laws in the coming year, and Congress is considering federal legislation to the same effect in the Fair and Open Competition Act, supported by ABC. Every union-sponsored legal challenge to such laws has been defeated, and more legislative and regulatory action in favor of open competition is expected during the next four years.

Labor Department Expected to Withdraw Unlawful ‘Persuader’ Advice Reporting Rule 
On March 24, 2016, the U.S. Department of Labor (DOL) published a new rule sweeping aside more than 50 years of enforcement policy under the Labor Management Reporting and Disclosure Act. The new rule required employers and their advisors (lawyers, consultants and even trade associations) for the first time to file public reports describing any advice that “indirectly persuades” employees regarding unionization or collective bargaining. ABC and several other business groups sued in federal court to block the rule from taking effect. 

In December 2016, a federal judge agreed, issuing a permanent injunction declaring that the Obama administration’s rule infringed on attorney-client confidentiality and imposed unprecedented burdens on employers’ Constitutional rights to free speech and free association. 

The Obama administration filed an appeal from the district court’s nationwide injunction, but that appeal has been placed on hold until Trump’s new Secretary of Labor is confirmed and reviews the litigation. It is widely expected that the Trump administration will no longer pursue the appeal. Upon conclusion of such a review, the unlawful persuader advice rule should be withdrawn. 

Osha Expected to Review Silica And Injury Reporting Rules 
On March 25, 2016, OSHA published a new exposure standard for respirable crystalline silica. The final rule lowered the permissible exposure limit (PEL) from the current standard of 250 micrograms per cubic meter of air to 50 micrograms per cubic meter of air, averaged over an eight-hour day, originally planned to take effect on June 23, 2017, with limited exceptions. A broad coalition of construction associations, including ABC, filed a petition for review of the standard in a federal appeals court. Many other industry groups are seeking to overturn the new standard as well, presenting substantial evidence that the new PEL is both technologically and economically infeasible. In response to industry requests for more guidance in advance of compliance with the new standard, OSHA agreed to delay the compliance date for 90 days, until Sept. 23, 2017. 

Secretary Acosta further indicated during his Senate hearing that this standard and other Obama administration safety rule changes would be reviewed and reevaluated. 

Another significant rule undergoing review by the DOL is the Obama administration’s changes to the injury reporting rules. Effective Dec. 1, 2016, the previous administration imposed unprecedented anti-retaliation requirements that effectively prohibited employers from routinely requiring drug tests following workplace accidents and from awarding incident-based safety incentives to employees. Effective July 1, 2017, the Obama administration rule also will require businesses to publicly report injury data that was previously considered to be proprietary information. 

Again, ABC and other business groups have challenged these rule changes in federal court. In addition, the Trump administration is reviewing and reevaluating the adverse impact of these rule changes.

In a related development, Congress disapproved another Obama OSHA rule that would have allowed the agency to extend the time period for citing employers for insufficient injury reporting, contrary to another court ruling. Following Congress’ action, this unlawful OSHA action, known as the “Volks Rule,” has been nullified.

‘White Collar’ Overtime Rule Change Remains Under Review 
In 2016, at President Obama’s direction, the DOL issued a new rule that radically increased the minimum salary for executive, administrative and professional employees to be exempt from being paid overtime under the Fair Labor Standards Act. ABC, along with many other business groups, again sued the department in federal court and succeeded in blocking the new overtime rule from taking effect. The Obama administration filed an appeal from the district court’s order in December 2016. 

Once President Trump took office, the appeal was stayed to allow incoming Labor Department appointees to re-evaluate the rule. That process was delayed by the slow nomination of Secretary Acosta, but is now under way. Meanwhile, the district court’s nationwide injunction against the new overtime rule remains in effect.

Davis-Bacon and Apprenticeship Regulations Need Review 
At this writing, numerous common-sense proposals to create greater fairness in enforcement of the Davis-Bacon Act are being considered in Congress and at the DOL. The process by which the department has determined the “prevailing wage” under the law has repeatedly been shown to be irretrievably broken, leading to inflated union wage rates that are not prevailing under any objective measurement. Where the union rates are found to be prevailing, hidden work assignment rules regularly are imposed on unsuspecting nonunion contractors, violating their rights and increasing the costs of government construction. 

It remains to be seen whether the Trump administration will take action to fix the serious flaws in Davis-Bacon enforcement, but ABC will continue its efforts to achieve legislative or regulatory fixes to this problem. 

Similarly, the DOL’s regulation of apprenticeship training requires review by the Trump administration. Some of the Obama administration’s final initiatives included significant changes to apprenticeship enforcement that will greatly increase costs and reduce the opportunities for training if allowed to stadnd. These include the new “Part 30” Equal Employment Opportunity Commission (EEOC) affirmative action rule that will impose significant new paperwork burdens during the next two years, and a new guidance bulletin on apprenticeship ratios that reneges on previous agency commitments to recognize flexible ratios of apprentices to journeymen. In the new administration, ABC will be pushing hard for greater recognition of creative methods of training the workforce outside the rigid confines of apprenticeship.

Pro-Labor Majority Retains Control Over the NLRB 
Controversies over President Trump’s cabinet nominees have slowed down the process of naming new members to the NLRB. Two vacant seats are available to be filled by Republican nominees, but until the new members are confirmed, pro-labor Obama administration holdovers remain in control of this important agency. Once the new Republican majority takes office at the board, it is widely expected that the NLRB will begin to reverse some of the radically anti-business rulings that were issued in recent years. 

In the meantime, a number of test cases are pending in the U.S. courts of appeals, including the NLRB’s much-publicized decision in the Browning-Ferris case, which changed the standard for “joint employers” in many industries, including construction. 

In another important ruling, the Court of Appeals for the D.C. Circuit vacated the NLRB’s pro-union standard restricting the use of independent contractors, in the case of FedEx Ground v. NLRB. The court found that the board’s new standard failed to adhere to the common law and previous court rulings on this issue. Other cases are expected to modify past anti-business rulings dealing with employee handbooks and union organizing once the Senate finally confirms the new NLRB majority. 

EEOC Reviewing Burdensome Regulations 
President Trump has appointed Republican EEOC Commissioner Vicki Lipnic to be acting chair of the agency. However, like the NLRB, Obama-appointed members retain control over the EEOC until the president appoints replacement commissioners to fill open seats. The EEOC is expected to review its previous burdensome mandate that would force employers to report salaries by sex, race and ethnicity starting in 2018. The agency’s final rule on wellness plans, retaliation, harassment and similar issues also need to be reviewed. 

Much work needs to be done to rescind and replace the myriad rules that imposed burdens on merit shop businesses during recent years. It is hoped that the Trump administration will succeed soon in getting its full team of labor officials in place in order to set a new agenda that will benefit employers and employees alike in the coming term. 

Maury Baskin is a shareholder with Littler Mendelson, P.C. in Washington, D.C., and general counsel to Associated Builders and Contractors. For more information, call (202) 772-2526 or email mbaskin@littler.com