Policy Watch: Cuts to DOL budget, attacks on joint employer standard

Congress returned from the July 4th recess this week, and Senate Republicans debuted yet another proposal in the ongoing attempt to repeal and replace the Affordable Care Act. The latest proposal still includes the severe cuts to Medicaid found in earlier drafts, so millions of Americans will lose health care coverage if this week’s version of the Republican plan becomes law. Meanwhile, the House Appropriations Committee released a fiscal year 2018 Labor, Health and Human Services, Education (LHHS) funding bill that would cut funding for the Department of Labor (DOL) by $1.3 billion. This measure also includes several non-funding-related requirements (often called “riders”) that would block or weaken labor protections. The House Committee on Education and the Workforce held a hearing attacking the concept of joint employer liability under various worker protection laws. And, the Senate Committee on Health, Education, Labor and Pensions (HELP) held a consolidated hearing on President Trump’s nominees to the National Labor Relations Board (NLRB) and to DOL.

Draining worker protection and training resources from the FY18 DOL and NLRB budgets

The LHHS funding bill from Appropriations Subcommittee Republicans would further reduce funding for agencies that are already stretched thin. Occupational Safety and Health Administration funding would be nearly $12 million less than even President Trump’s draconian budget request earlier this year (and about 4 percent less than the current budget). The Wage and Hour Division would face a roughly 6 percent cut. In other areas, the bill takes a hatchet to job training programs and other services, particularly the Workforce Innovation and Opportunity Act programs at the Employment and Training Administration. There’s also a whopping 9 percent cut ($25 million) to the National Labor Relations Board. The Bureau of Labor Statistics, crucial for providing much-needed data on the workforce, would suffer a 5 percent cut.

Tying DOL and NLRB’s hands on labor protections

Appropriations bills are often written or amended with unrelated “policy riders” that may never pass through the legislative process on their own, in an attempt to undermine safeguards through the backdoor. The LHHS funding bill is chock full of ideological riders, including:

  • Repealing and eliminating DOL’s fiduciary (or conflict of interest) rule, which requires financial advisors to act in their clients’ best interest
  • Prohibiting the NLRB from issuing any guidance, or pursuing and enforcing any case, based on the “joint employer” standard
  • Preventing the NLRB from protecting the rights of workers on Native American tribal lands to unionize
  • Continuing to allow employers to use private wage surveys to determine the prevailing wage level for H-2B guest workers, which many employers use to keep these wage rates lower
  • Continuing to block DOL from enforcing 2015 guest worker visa regulations on “corresponding employment” (meaning that employers will not be sanctioned for offering higher wages or benefits to H-2B workers without offering them to American workers) and the “three-fourths guarantee” (meaning that employers will not be sanctioned for failing to offer H-2B workers a minimum number of work hours).

House Education and Workforce Committee attacks joint employer standard

On Wednesday, the House Committee on Education and the Workforce held a hearing on Redefining Joint Employer Standards: Barriers to Job Creation and Entrepreneurship. The hearing provided Republican members an opportunity to attack the concept of joint employer liability under the nation’s basic labor and employment laws. At its most basic, the joint employer standard simply requires that when multiple employers co-determine or share control over a workers’ terms of employment (such as pay, schedules, and job duties), each of those employers is responsible for compliance with worker protection laws. The hearing focused nearly exclusively on employers and the complexities they might encounter when opening (or considering opening) franchises or considering new business models. However, the joint employer standard is really about ensuring that workers are able to exercise their rights—like the right to a minimum wage or the freedom to choose to join a union. Given the realities of the modern workplace, in which employees often find themselves subject to more than one employer, workers deserve a joint employment standard—under both the FLSA and the NLRA—that guarantees these basic rights and protections.

Senate considers Trump nominees to DOL and the NLRB

On Thursday, Senate Republicans chose to consolidate consideration of Trump’s nominees to the NLRB and his pick for Deputy Secretary of Labor into a single hearing. The NLRB is an independent agency whose members do not report directly to the president. Instead, board members serve as neutral arbiters of our nation’s labor law. DOL, meanwhile, is a cabinet-level agency whose leaders report directly to the president. In spite of the fundamental different in the agencies’ structure and role, Senate Republicans decided to examine Trump’s nominees in a single hearing, seated on a single panel. The move shortchanged workers who depend on these agencies and the officials who lead them to enforce their rights and protect their freedoms. The Senate HELP Committee is scheduled to vote on these nominations next week.

The Perkins Project Policy Watch will continue to track the Trump administration and Congress and provide information on how their actions impact our nation’s workers.