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President Trump’s Effect on the Workplace

When President-elect Trump takes office, what can employers expect? What will be the effect of his presidency on the workplace and workforce? The probabilities and possibilities range from minor to major changes, with both short and long-term effects.

Supreme Court

The Trump presidency will have long-term, pro-employer effects. Trump will present a conservative nominee to fill the opening to replace Justice Scalia. Justice Anthony Kennedy, who fluctuates between conservative and moderate, will revert to his role as the 5th vote to swing tight cases. Justice Kennedy is 80 years old. Two other liberal justices, Justice Breyer and Justice Bader Ginsburg, are 78 and 83 years old, respectively. There is a real possibility that Trump may make more than one conservative appointments, particularly if he serves two terms.

The expected employment matters before the SCOTUS will include the following:

  • Arbitration agreements
  • Waivers of class action litigation
  • Wage and hour laws
  • Expansion of Title VII
  • Immigration programs
  • Union fees
  • NLRB and other administrative agency powers

While it would seem that employers are in a position for a string of overwhelmingly pro-employer decisions, a word of caution: Trump wants to appoint justices similar to Justice Scalia. The decisions of Justice Scalia were not universally pro-employer; in fact, Justice Scalia wrote the Court’s decision which interpreted Title VII of the Civil Rights Act of 1964, and held that same-sex sexual harassment creates a cause of action for sex discrimination. Nonetheless, it is likely that the cases involving arbitration agreements and waivers of class action will be decided in favor of employers.

Overtime Rules

The Trump presidency may not be able to stem the implementation of overtime rules, but he will likely carve out exceptions. The new FLSA overtime regulations are set to be implemented on December 1, 2016. As reported by the Daily Labor Report, David Malpass, senior economic advisor to Trump, told reporters after an October 20 National Economists Club discussion that “Trump has said that’s a harmful regulatory change.” He added, the “regulation is very harmful to job creation because it forces companies to rethink whether they’re going to hire people, and the companies around the country begin reducing their hiring in anticipation of that December 1 deadline.” Malpass would not commit the administration to repealing the entire regulation.

Whether the overtime rule goes into effect on December 1 depends upon the decision of a federal court in Texas where an injunction proceeding is pending. Oral arguments are on November 16. If the injunction fails and the rules go into effect, Trump can rescind the rules by beginning the notice-and-comment administrative rulemaking process all over again. This would leave the rules in effect for years while the rulemaking process runs its course.

Instead, look for Trump to create small-business exemptions to the FLSA overtime rules. While he discussed the small-business exemptions during his campaign, he has not presented a formal plan.

NLRB

Everything is in play before a Trump appointed National Labor Relations Board (“NLRB”). The current Board has two (2) pro-union members, and one (1) pro-employer member. The lone conservative has been, at times, tenaciously critical of the liberal majority. However, those criticisms have languished in dissenting opinions. A full NLRB has five (5) members. Trump can immediately appoint two (2) pro-employer voices to control the majority. What would that mean?

  • “Concerted protected activity” interpretations will be scaled back to reality. The “concerted protected activity” doctrine is the gateway by which NLRB has sanctioned both union and non-union employers, particularly regarding Employee Handbooks and Social Medial Policies.
  • Clients of temporary staffing companies and other joint employers can begin to relax because the expansion of “employee status” will be restrained. The current Board has expanded “employee status” to impose collective bargaining obligations on non-union employers with temporary or joint employees.
  • The determination of “supervisory status” for collective bargaining purposes has also been significantly modified. The pro-union Board has narrowed the definition of “supervisor” and thereby expanded collective bargaining units to include supervisors who previously fell outside of the terms of the National Labor Relations Act. A pro-employer Board will revert to the broader, employer-friendly evaluation of whether supervisors hold collective bargaining rights.
  • The “Blacklisting Rules,” which were created by executive order, will be revoked and their requirements on government contractors to publicly disclose the past three (3) years of any violations of 14 federal workplace laws will be eliminated.
  • Quickie election rules may be curtailed. This would provide a further drop in union participation.

A word of caution, however, is that Trump’s success in the election was due, in part, to the votes of union members. Also, in his private business, he has maintained friendly relationships with unions. It would not be surprising for Trump to provide some beneficial policies to organized labor. Also, keep in mind that these are relatively short-term effects and will remain in place until pro-union NLRB changes them all.

Restrictive Covenants

Based upon Trump’s business background, it is highly unlikely that he will endorse Obama’s recent “call to action” for states to enact laws to diminish the power of non-competes and other restrictive covenants.

OSHA

Trump promised to remove regulations which impede business. OSHA’s electronic reporting rule, which takes effect on July 1, 2017, is an unnecessary burden on employers since they already track injury and illness information on OSHA 300 logs. The electronic reporting rule is a bureaucratic imposition on employers to post injury and illness information for public viewing. It seems like the exact type of regulation Trump will reject.

Likewise, the OSHA penalty increases are immediate, onerous, and will continue to rise. The OSHA maximum penalty requirements will also be a target.

Paid and Unpaid Leave

Trump promised six weeks of paid maternity leave for new mothers. Also, during the first presidential debate, Trump agreed with Hillary Clinton’s proposed expansion of the Family and Medical Leave Act (FMLA). However, with the dramatic increase in local government activism regarding leave, the expansion of leave rights on a federal level is not a battle Trump would need or want. Vice President Pence has repeatedly voted against Democrat efforts to expand FMLA. GOP lawmakers have historically opposed expanded leave as restrictive on business and an improper expansion of government. It is unlikely that a bill to expand leave will be presented to Trump.

Workforce Enforcement of Immigration Laws

This is not about a wall. Trump supports the mandatory nationwide use of E-Verify by all employers. E-Verify is an employment eligibility verification system authorized by Congress that is used by state and local employers, as well has many private employers. Congress will likely present Trump with a bill to impose mandatory E-Verify program requirements on employers.

This list is non-exhaustive and doesn’t even touch upon ACA. Many of the effects will be fact-specific and will involve the interpretation, application, guidance and enforcement of federal laws. Remember – Trump will be appointing federal judges and the new head of the EEOC

We will keep you informed of all developments as they progress. For any specific questions or clarification, please contact the Labor and Employment Team – John Childs at (330) 253-1946 or Jeffrey Miller at (216) 287-5265.

Investment Training for the Second and Third Generations

Consider this scenario. Mom and Dad started the business from the ground up. Over the decades it has expanded into a money-making machine. They are able to sell the business and it results in a multimillion-dollar payday for their labors. The excess money has allowed Mom and Dad to invest with various financial advising firms, several fund management groups, and directly with new startups and joint ventures. Their experience has made them savvy investors, with a detailed understanding of how much to invest, when, and where. They cannot justify formation of a full family office with dedicated investors to manage the funds, but Mom and Dad have set up a trust fund for the children to allow these investments to continue to grow over the years. Eventually, Mom and Dad pass. Their children enjoy the fruits of their labors, and, by the time the grandchildren are adults, Mom and Dad's savvy investments are gone.

Provider Relief Funds – Continued Confusion Regarding Reporting Requirements and Lost Revenues

In Fall 2020, HHS issued multiple rounds of guidance and FAQs regarding the reporting requirements for the Provider Relief Funds, the most recently published notice being November 2, 2020 and December 11, 2020. Specifically, the reporting portal for the use of the funds in 2020 was scheduled to open on January 15, 2021. Although there was much speculation as to whether this would occur. And, as of the date of this article, the portal was not opened.

Ohio S.B. 310 Loosens Practice Barrier for Advanced Practice Providers

S.B. 310, signed by Ohio Governor DeWine and effective from December 29, 2020 until May 1, 2021, provides flexibility regarding the regulatorily mandated supervision and collaboration agreements for physician assistants, certified nurse-midwives, clinical nurse specialists and certified nurse practitioners working in a hospital or other health care facility. Originally drafted as a bill to distribute federal COVID funding to local subdivisions, the healthcare related provisions were added to help relieve some of the stresses hospitals and other healthcare facilities are facing during the COVID-19 pandemic.

HHS Issues Opinion Regarding Illegal Attempts by Drug Manufacturers to Deny 340B Discounts under Contract Pharmacy Arrangements

The federal 340B discount drug program is a safety net for many federally qualified health centers, disproportionate share hospitals, and other covered entities. This program allows these providers to obtain discount pricing on drugs which in turn allows the providers to better serve their patient populations and provide their patients with access to vital health care services. Over the years, the 340B program has undergone intense scrutiny, particularly by drug manufacturers who are required by federal law to provide the discounted pricing.

S.B. 263 Protects 340B Covered Entities from Predatory Practices in Ohio

Just before the end of calendar year 2020 and at the end of its two-year legislative session, the Ohio General Assembly passed Senate Bill 263, which prohibits insurance companies and pharmacy benefit managers (“PBMs”) from imposing on 340B Covered Entities discriminatory pricing and other contract terms. This is a win for safety net providers and the people they serve, as 340B savings are crucial to their ability to provide high quality, affordable programs and services to patients.