Episode 106: Federal Labor Law Changes to Expect

Welcome to the Workplace, a podcast by Cal Chamber. I'm Erica Frank, Cal Chambers executive vice president and general counsel. And joining me on the podcast today are Ashley Hoffman, Cal Chambers policy advocate on labor and employment issues, and Chris McKayley, who is a partner with Apria and McKayley lobbying firm in Sacramento. Welcome, Chris. Welcome, Ashley.

Thank you. Nice to see everybody or hear you in this case.

Thanks, Erica. Happy to be here.

Yes, happy for you both to be hearing. Yes. We are still remote, doing our best to continue bringing the information to all of you. And just by way of background to our listeners, both Ashley and Chris spent a lot of time in the state Capitol, or as it is right now, on virtual meetings, educating policymakers about the impact that proposed legislation will have on employers. They are both fierce advocates for California's business community. Today's podcast is where we wanted to get some predictions and thoughts from Ashley and Chris about what legislation they expect to see this year that could affect employers. And for this first episode, we wanted to focus on federal legislation. And in the next podcast, we'll focus specifically on California legislation. So, Ashley and Chris, let's get to it. Let's talk about what we think is going to happen now. We have a brand new administration. President Biden took office a few weeks ago, and as we know, when we have a change in administration, there is definitely a change in the guard across the board where we have new heads of agencies go into place and certainly different agendas that the new president will like to pursue. And labor and employment is always a hot topic. So what are y' all hearing right now this early in the year?

Well, we've heard quite a bit at this point, Erica, because as with any change in the federal administration, whether it's Democrat to Republican or Republican to Democrat, certainly labor and employment is one of those issue areas where a lot is happening. And as we know from the past four years, whether you supported or opposed President Trump, he did quite a bit in the labor and employment area, much to the dismay of labor unions and certainly Democratic legislators. And so when President Biden came into office on January 20, he jumped right into things. For example, as a general rule, most presidential appointees resign with the end of that current administration. But the then general counsel of the National Labor Relations Board declined the invitation to resign. And so within hours of taking the presidential oath of office, President Biden fired the general counsel, which obviously marked a stern statement on behalf of the new administration. And he was also able to elevate one of the five members, a Democrat, on the National Labor Relations Board to actually serve as chair. Now, to be fair, there are still three Republican members and one vacancy, but one of those three Republicans will be out of office. Their term will expire later this year. So by the late summer or early fall, the president will be able to make a majority of the appointments there. The other important thing is, is that the president revoked a number of the Trump executive orders. And then finally, as every president does again, Democrat or Republican, they place a hold on any pending regulatory actions. And the Trump administration attempted to make a number of last minute regulatory changes that will not end up taking effect as a result of the new president's action of rescinding those proposed regulatory changes.

So, Chris, you mentioned the National Labor Relations Board, and I think that's a really important point to make because we saw in the Obama administration that the National Labor Relations Board was very active.

In the area of actually social media and social media agreements that employers had. And of course, erring more on the side of the employees being able to have quite a bit of latitude over what they say in social media and what, what constitutes as workplace speech, so to speak, or discussions or grievances about the workplace. Ashley, have you heard of any particular issues that the National Labor Relations Board is particularly looking at? Or are we just reading the tea leaves, so to speak, anticipating that some of the positions that the Trump administration had taken will turn the other direction, for lack of a better word, I.

Think you hit on one of them. Some of the speculation I've seen, certainly about letting employees use employer resources for communications, definitely, I think a policy that the Biden administration is looking to bring back. President Biden has tweeted about making it easier for every American to organize, to unionize, being able to do so also in small groups. Those are a couple of items, at least as far as the NLRB goes, that we've definitely seen some conversations about.

If I could just add, you know, when Trump took office, one of his goals was to overrule a number of the NLRB decisions during the Obama administration.

And many of those favored employers across the country, as you would probably expect, as you would also expect with a new Biden administration majority board, once they take hold with a Democrat majority, again, are undoubtedly going to try and overrule many of the decisions of the Trump era board. One of the big ones, for example, is on joint employment, making it easier now to find joint employers. So for your, you know, franchisees, for example, or those who engage in franchise agreements, it might be easier for that parent company to be held liable for example for labor and employment violations as being designated a joint employer along with the franchisee.

And Chris, to your point of a switch in positions regarding opinion letters and board rulings, we actually saw in December, the Department of labor, the federal Department of Labor issued a host of opinion letters. I mean, Merry Christmas, employers. There were a number of them, one of which had to do with tip pooling and how to allocate tips, whether the back of the House staff get the tips versus the front of the House staff. And one of the executive orders that you mentioned, Chris, that President Biden issued was to retract one of those opinion letters. And so then we saw quickly the Department of Labor issuing another advisory, saying these were premature. So we're already seeing some of the positioning switching this early in the administration.

Exactly. And I would just add, I think some friends at the federal level had pointed out to me that in the president elect's transition advisory committee related to labor, that there really weren't any, you know, advisory members who were from a management or corporate side. And then as we're all aware.

The Boston mayor, Marty Walsh, has been named as the nominee for secretary of labor, who comes from a labor background, obviously. And President Biden has long enjoyed what, more than five decades of elected office, particularly in the United States Senate, as he's put it. He's called himself often a union man. Now, it may send shivers up some, you know, corporate employers spines, if you will, with that. But similar to the Obama administration, I think we'll see a lot of those types of policies. I am aware that probably two areas, including the persuader rule is likely to be a prime area for the U.S. department of Labor. And then also there are some provisions out there related to how unions have to report financial items and make certain disclosures. And it's my understanding that the U.S. department of labor is going to try to make things easier for unions about some of their financial reporting and what they have to publicly disclose and not disclose.

Okay. So there's quite a bit of change on the horizon, not that employers haven't had to deal with quite a bit of change over the last year. We'll see what happens on the federal front, but more closer to home are the things that we might see on California's front. And Ashley, I'm sure you have a lot to talk about there as well.

Yeah, there's a lot of similarities, I think, on issues that we're seeing arising both at the federal and the state level, including whether there's going to be new mandates for Covid supplemental paid sick leave either on federal, state level or both, as well as whether there's going to be some federal changes and the independent contractor test that would mirror state law of California, the ABC test. Fortunately, we don't have enough time today to talk about all of that, but please do tune in for the next piece of this segment where we go over what we're seeing on the state level in California and can talk about how some of those issues will have some interplay between state and federal.

So like your favorite show and this isn't like Netflix where you can go to the next one right away. You're going to have to wait for the next podcast where we continue this conversation but focus on California's horizon and what California's legislature is planning for us. So Chris and Ashley, thank you so much for joining me today and thank you for joining us on the Workplace. Please comment, share and subscribe to Cal chambers podcast. Visiting calchamber.com.