United States: Final Overtime Rule Advances (Beltway Buzz, August 16, 2019)

Last Updated: August 20 2019
Article by James J. Plunkett

The Beltway Buzz is a weekly update summarizing labor and employment news from inside the Beltway and clarifying how what's happening in Washington, D.C. could impact your business.


Final Overtime Rule Advances. The U.S. Department of Labor's Wage and Hour Division's proposal to increase the salary threshold regarding overtime pay to slightly more than $35,000 per year took another step forward in the regulatory process this week. On August 12, 2019, the Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA) received a draft of the final rule for review. As the Buzz has discussed on multiple occasions, OIRA is a regulatory gatekeeper of sorts and is the first and last stop in the rulemaking process for most regulations. While we don't know how long OIRA might take to review the rule, this action means that we could see a final overtime rule in a matter of weeks. This would also give the regulated community several months to come into compliance if the effective date remains January 2020, as indicated in the initial proposal.

H-1B Fee Proposal News. While the overtime regulation is in the final stages of the rulemaking process, United States Citizenship and Immigration Services' (USCIS) proposal to require a fee for H-1B registrations is just beginning. The proposal, which is an add-on to USCIS's preregistration rule that issued in January 2019, cleared the OIRA review process on August 12. This means that USCIS is likely to release the proposal for public comment at any time now. The Buzz will obviously be monitoring this development, with a particular eye on whether a final rule may be put in place prior to the arrival of the Fiscal Year 2021 cap season next spring.

OFCCP Proposes Religious Exemption Regs. On August 15, 2019, the Office of Federal Contract Compliance Programs (OFCCP) issued a notice of proposed rulemaking (NPRM) "to provide clarity regarding the scope and application of the religious exemption" contained in section 204(c) of Executive Order (EO) 11246. According to the NPRM, these proposed changes are intended to address concerns expressed by religious organizations that may be reluctant to participate as federal contractors because of uncertainty regarding the religious exemption. Critics of the proposal maintain that it eliminates LGBTQ protections installed by EO 13672 in 2014 by President Obama. Comments on the proposal are due on September 16, 2019.

NLRB Opines on Arbitration. This week, the National Labor Relations Board (NLRB) issued a decision that, for the first time, applies the decision of the Supreme Court of the United States in Epic Systems Corp. v. Lewis to specific situations in the workplace. In Cordua Restaurants, Inc., the Board ruled that employers may condition employment upon the signing of an arbitration agreement and that employers may issue, or amend, arbitration agreements in response to Section 7 activity. However, the Board also ruled that federal law prohibits employers from taking action against employees who pursue collective legal actions.

House Oversight of NLRB. Representative Bobby Scott (D-VA), who chairs the U.S. House Committee on Education and Labor, was already unhappy with what's been happening at the NLRB, and this latest Board decision isn't likely to make him feel any better. On August 12, 2019, Scott sent a letter to NLRB General Counsel Peter B. Robb expressing concern that Robb "is significantly narrowing employers' liability under the NLRA and reviving charges against unions at an unprecedented level." The letter sets forth 19 comprehensive document requests touching on everything from the general counsel's protocols for issuing complaints to joint-employer matters to employees' Beck rights and everything in between. The letter is a prime example of how Congress—through its oversight function—can impact or influence policy decisions in the executive branch.

Trade Policy (on a Stick). August is state fair time in many locales across the country, and the Iowa State Fair is perhaps the most popular of them all. This year, Democratic presidential candidates toured the fair in hopes of boosting their political prospects ahead of the Iowa caucuses. But with Iowa's large agricultural economy, the state fair is also a logical place for policymakers and stakeholder groups to promote passage of the not-so-creatively-named United States–Mexico–Canada Agreement (USMCA) trade deal. Indeed, is there a better time to have a serious discussion about sanitary and phytosanitary measures than while taking in a butter sculpting competition? Or perhaps the pigeon rolling contest is the ideal venue for debating the 10-year data exclusivity provision for biologic pharmaceuticals contained in the USMCA. In fact, maybe the easiest way to gin up support for passage of the USMCA is to promise that it will result in the free flow of Snickers in a Waffle on a Stick across our southern and northern borders. That would be a victory for citizens of all three countries.

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