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As the Obama administration nears its conclusion, federal labor agencies seem intent on issuing as many burdensome and anti-business regulations as possible. Many of the new rules are unprecedented in their scope and change decades of policies on which employers have come to rely.  

DOL Announces Radical Change to Overtime ‘White Collar’ Exemption Rules
On May 18, the DOL announced long-awaited changes to the so-called “white collar” exemption to the Fair Labor Standard Act’s overtime requirements. Among other changes, the new rule doubles the minimum salary that employees must be paid to qualify for exemption from overtime, setting the new minimum at $47,476 for executive, administrative and professional employees, among others. The minimum will automatically increase over time, under another unprecedented provision of the new rule. The new rule goes into effect on Dec. 1.

Along with many other business groups, Associated Builders and Contractors (ABC) filed comments opposing the radical increase in the minimum salary of exempt employees and other aspects of the proposed rule. A legal challenge is being considered at this time.

DOL Issues Unprecedented ‘Persuader’ Reporting Rule
On March 24, 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 requires employers and their advisors (lawyers, consultants and even trade associations) for the first time to file public reports with the DOL describing any advice that “indirectly persuades” employees regarding unionization or collective bargaining. Previously, reports were only required if an employer hired someone to communicate with employees on the employer’s behalf.

The new rule infringes on attorney-client confidentiality and imposes unprecedented burdens on employers’ constitutional rights to free speech and free association. The rule will make it harder for employers to get the advice they need on how to talk to their own employees, even though Congress expressly stated in the law that all advice should be exempt from any reporting requirement.

ABC is leading a coalition of business groups challenging the new rule in court. The lawsuit remains pending at this time.

NLRB’s ‘Quickie’ Election Rule Still Being Challenged
In April 2015, the National Labor Relations Board (NLRB) put into effect controversial changes to its election processing rules. There were more than two dozen procedural rule changes in all, most of which were aimed at shortening the time between the filing of a union petition and the conduct of an election. The new rule also forces employers for the first time to turn over their employees’ personal email addresses and phone numbers to union organizers.

ABC filed suit against the NLRB in 2015, challenging the new election rule. That case remains pending in the U.S. Court of Appeals for the 5th Circuit. Parts of the rule could be struck down during the coming months, but in the meantime, more than 2,000 union petitions have been filed. The time from petition to election under the new rule has been reduced dramatically, and unions are winning 70 percent of the elections held.

OSHA Adopts New Restrictions On Silica Exposure; Imposes Public Electronic Reporting Requirements
On March 25, OSHA published a new exposure standard for respirable crystalline silica. The final rule lowers 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, effective 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. The groups have presented substantial evidence that the new PEL is both technologically and economically infeasible.

On May 12, OSHA also published a new rule forcing many employers to file electronic reports of workplace injuries for posting by OSHA on the internet, effective Jan. 1, 2017. In addition, the agency has declared for the first time that some forms of post-accident drug testing will be deemed to be unlawfully retaliatory effective Aug. 10. ABC is contemplating a legal challenge to this new rule as well.

NLRB’s New Joint Employer Standard Starts to Impact the Construction Industry
In August 2015, the NLRB issued an important pro-union decision in a case called Browning-Ferris, changing the standard for “joint employers” and allowing a union to force both a staffing agency and its client company to the bargaining table after an election among the staffing agency’s employees. Though the Browning-Ferris case itself did not involve a construction contractor, the NLRB is now considering another case that squarely seeks to apply the new standard to a construction contractor and a labor supply subcontractor.

The impact of this case could be very harmful for the merit shop construction industry. For example, contractors could become responsible for the labor standards of workers they know nothing about and could be liable for their subcontractors’ unfair labor practices and bargaining with unions.

DOL Blacklisting Regulations Expected Soon
In 2014, President Obama issued an executive order calling on the DOL and government procurement agencies to develop unprecedented rules that may result in disqualification of any government contractor that violates one of 14 different labor laws and many more state laws, including the National Labor Relations Act, the Fair Labor Standards Act, OSHA and Davis-Bacon.

A proposed rule was issued in 2015, that ABC and many other business groups strongly opposed. Nevertheless, the government agencies are expected to issue final rules soon that implement the executive order in 2016. Another lawsuit is expected to challenge the blacklisting rule based on the president’s lack of constitutional authority to issue the executive order.

Appeals Court Rejects DOL’s Expansion of Davis-Bacon Act
On April 5, the U.S. Court of Appeals for the D.C. Circuit issued an important decision limiting the coverage of the Davis-Bacon Act—the law that imposes “prevailing wages” on federally funded construction projects. In the case of District of Columbia v. USDOL, the court rejected the Obama administration’s attempt to expand coverage of Davis-Bacon to a privately funded, owned and occupied construction project in the District of Columbia, known as CityCenterDC.

ABC filed a “friend of the court” brief supporting the outcome of this case. 

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 federal projects. The number of states that have prohibited state government entities from requiring contractors to sign a PLA as a condition of performing work on public construction projects has now grown to 23. Union-sponsored legal challenges to such laws were defeated in Idaho and Louisiana during the past year. 

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.  

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