LABOR DEPARTMENT TO PUSH AHEAD ON NEW RULES BEFORE DEADLINES

Written on April 01, 2020.

The Department of Labor (DOL) is struggling to finalize various proposed regulations at a faster pace due to two converging factors. First, under the 1996 Congressional Review Act (CRA), rules finalized in the last year of an administration can be repealed if they have not gone into effect yet, and stayed in court while their validity is being challenged. Under the CRA, any rule finalized in the last 60 legislative days of the congressional session can be vetoed within the first 60 days of the new Congress if a resolution is passed by both chambers and the President signs it into law. Second, after the resignation of Alexander Acosta as Secretary of Labor, the new Acting Secretary, Patrick Pizzella, is known to be much more aggressive pursuing deregulation and pro-business initiatives. Eugene Scalia has been nominated by President Trump as the new Secretary of Labor, but he is not expected to be confirmed until the fall. Scalia is known to share Pizzella's enthusiasm for pursing pro-business regulatory reform, and Scalia and Pizzella have worked together in past administrations to do just that.

It may surprise readers to know that it takes 1-5 years to finalize a significant new federal rule. The relevant agency must develop various documents supporting the new rule, allow for public comment, and particularly to follow closely the steps in the Administrative Procedure Act and other requirements of agency rule-making. If the regulatory requirements are not met, a federal court can invalidate the federal rule and so careful planning is necessary.

Some 15 Obama-Era rules were invalidated using the CRA, and the same thing has happened to some of the current administration's regulatory proposals.

Publication of new proposed salary tests for the white-collar exemption is expected to be released any time now, and the DOL is pushing ahead on the joint employer rule and clarification of the "regular rate" for overtime purposes. Another rule likely to move ahead in the near future is the "fluctuating work week" proposal, a rule giving employers the option to pay certain workers whose hours vary each week at half their regular rates, instead of time and a half for hours worked over 40. While this rule currently exists, it is not always available to employers that compensate their employees with bonuses or other incentive-based pay.