Fall 2013 Legislative and Regulatory Outlook
Posted in: Legislative Updates
Depending on the outcome of the current government shutdown precipitated by Congress’ failure to agree to a funding resolution to keep federal agencies running, previously projected legislative and regulatory actions could potentially be delayed or derailed by an ongoing fiscal crisis. However, a number of items remain on Congress’ and agencies’ radars despite the impasse on funding.
The following is IEC’s summary of key policy priorities heading into the final quarter of Calendar Year 2013.
Fiscal Year 2014 Funding
Late into the evening on Monday, September 30, the United States Congress failed to reach an agreement on legislation to fund federal agencies before the start of the new 2014 Fiscal Year, leading to a government shutdown effective at midnight on October 1. Earlier in September, the House of Representatives had passed a continuing resolution funding the government at an annualized rate of $986 billion through December 15, 2013. That legislation also contained language defunding President Obama’s health care bill, which the Democrat-controlled Senate promptly stripped in its consideration of the measure. Republicans countered with a one-year delay of only the “individual mandate” under the Affordable Care Act (ACA) which was again defeated by the Senate, assuring government closures and staff furloughs the next morning. The House extended an offer to the Senate to assemble a conferencing committee to discuss a potential compromise between both chambers’ objectives, but that too was rejected.
As a result, starting on October 1 nearly 800,000 federal workers deemed to be “non-essential” were estimated to be furloughed – some told not to report to work, and others serving without pay – leading to widespread shutdowns and delays across the federal government.
IEC has put together a list of projected agencies, services, and activities of interest to our contractor members that stand to be impacted by the shutdown, viewable in the IEC Newsroom.
In the meantime, the House is attempting to pass piecemeal legislation funding isolated critical government operations. Bills funding the NIH, opening national parks, and funding the DC government passed successfully the evening of October 2, but it is unclear whether the Senate will approve them.
With both parties firm in their stance, as of yet there appears to be no resolution to the shutdown. However, it is expected that House Republicans will eventually consent to a “clean” continuing resolution that funds the federal government without stipulations over ACA implementation.
It is unlikely that any omnibus Fiscal Year 2014 bill will be passed and enacted, resulting in a series of additional short-term funding resolutions that will carry the nation well beyond the Fiscal Year 2015 budget process, which begins early next year.
While Congress and the Administration grapple with the shutdown, another fiscal crisis looms in the form of raising the nation’s debt ceiling, which stands at $16.7 trillion and is set to be reached mid-October when the country will run out of borrowing authority.
Prior to the shutdown, House Republicans were discussing a debt limit bill that would remove the ceiling on federal borrowing authority for more than a year, once again delay ACA implementation, cut mandatory spending, instruct Congress on a tax overhaul, decrease regulatory burdens to business growth and increase domestic energy development. The measure would reuse a mechanism employed earlier this year to move the date the debt limit would be reached rather than setting a new dollar amount – the Republican plan would supposedly move that date past the November 2014 elections.
It is unclear when Congress will move to address the debt ceiling due to ongoing negotiations over a temporary funding resolution.
Despite a one-year delay of the employer mandate under the ACA for larger businesses (with 50 or more employees), all employers were required to notify their workers of available healthcare exchange options by October 1. New workers hired after the deadline must be informed of their coverage options within 14 days of their start date. While IEC members employing 50 or fewer full-time employees are not required to offer coverage themselves, they still must inform employees about open enrollment for state and federal insurance exchanges created by the new healthcare law. However, there are no penalties or fines for failure to do so.
The Department of Labor has issued employer guidance regarding the notification requirements and has also drafted downloadable model employee notices for use by employers offering insurance plans as well as for those without plans.
According to the guidelines, employers are required to provide a notice of coverage options to each employee, regardless of plan enrollment status or whether they are part-time or full-time. Notices should include information about available exchanges and how to contact exchange administrators for assistance; employee eligibility for a premium tax credit for the purchase of a qualified health plan through the exchange; and the potential loss of the benefit of employer contributions to employer-sponsored health plans should the employee opt to enter an exchange.
Coverage under the exchanges should begin January 1, 2014, although some states have pushed their activation deadlines back further into the new year.
Meanwhile, unions have been pushing back against President Obama’s health care plan, with the AFL-CIO adopting a resolution on September 11 that outlines flaws with the Affordable Care Act that could potentially hurt union health plans. The AFL-CIO was seeking an exemption that would extend health insurance exchange premium and cost-sharing subsidies under the ACA only to unionized workers covered by employer-sponsored insurance. The White House has since stated that no such exemption would be granted and reiterated that union health care plans already receive favorable tax treatment.
Labor and Workforce
Before the August Recess, the case challenging the constitutionality of President Obama’s appointments to the National Labor Relations Board (NLRB) and the validity of their subsequent decisions – Noel Canning vs. NLRB – was escalated to the Supreme Court. The Court has since added Noel Canning to its official fall docket when it reconvenes for a new session this October. However, action by the Court on this case is not expected until early to mid 2014. At the same time, the NLRB is now functioning with a full quorum of members with 3 Democrats and 2 Republicans. Additionally, two of the contested recess appointees to the Board, Sharon Block and Richard Griffin, it appears both will still have soft landings within the Department of Labor (DOL).
Block has been appointed “Special Assistant” to newly sworn Secretary of Labor Tom Perez, while Griffin has been nominated to fill the role of General Counsel to NLRB Chairman Mark Pearce. His nomination cleared the Senate Committee on Health, Education, Labor and Pensions (HELP) earlier in September, but a vote by the full Senate has yet to be scheduled.
The term of one of the newly seated Democrat Board Members of the NLRB, Nancy Schiffer, is set to expire in December of 2014, reverting the Board’s makeup to a 2-2 split between Democrats and Republicans. With a short-lived Democrat majority on the NLRB, Supreme Court action on Noel Canning looming, and Perez at the helm of DOL, aggressive pro-union actions can be expected from both DOL and the NLRB over the next few months. However, the government shutdown has reduced both DOL and the NLRB to a skeleton crew for the moment, essentially halting any movement on regulatory or enforcement actions.
Still pending at the DOL is a finalized “Persuader Rule” which would require employers disclose to the DOL any arrangements they have with consultants to address employee unionization efforts or collective bargaining. Under the proposed rule, virtually all interaction with labor lawyers and consultants – and even potentially trade associations that provide guidance to members on labor policy – would be subject to the disclosure requirements. IEC expects the NLRB to reintroduce its “Quick Snap Elections” rule, which was defeated in the courts last year on a legal technicality based on the lack of a quorum of members on the Board required for such a rule to be issued. Coupled with the Persuader Rule, these two actions could spell back-door implementation of the legislatively-failed Employee Free Choice Act by regulatory means.
If there is room in the Senate’s legislative agenda, reauthorization of the Workforce Investment Act could also be in the cards. The Senate HELP Committee approved legislation in late July with wide bipartisan support, and leadership was hopeful to move the bill to the floor earlier this fall. S. 1356, the “Workforce Investment Act of 2013," would reauthorize the 1998 Workforce Investment Act and make improvements to reflect the needs of the current labor market and economy. The bill would improve WIA funding distribution by using data-based allocation of funding based on impact of investment, empower state and local workforce agencies to tailor programs to meet their area’s needs, and emphasize real-world education and training opportunities such as apprenticeship. Earlier this spring, the House passed its own workforce investment bill, the SKILLS Act, which seeks to streamline existing WIA programs across multiple federal agencies into one workforce development fund.
Equal Employment Opportunity In Apprenticeship and Training
It is anticipated that, in late fall, 2013 or early 2014, DOL will move forward with revision of Title 29, Part 30 of the Code of Federal Regulations, which sets forth policies and procedures to promote equality of opportunity in apprenticeship programs registered with the Department of Labor and in state apprenticeship programs registered with recognized state apprenticeship agencies. This update will likely update apprenticeship regulations to reflect other existing federal EEO requirements. However, the advent of new regulations may result in increased EEO enforcement activity on the part of DOL.
The 2014 NEC code books are now being shipped to fill orders. It has been reported that there are errors in the first edition of the code book. The errata sheet can be downloaded from the NFPA site.
The NEC code development process will be different for the 2017 NEC code cycle. Public input (previously called proposals) will now be submitted by writing the code article of the NEC exactly as you would like to see it in the code book.
Subcommittees of the National Electrical Safety Code (NESC) will be meeting in Piscataway NJ during the month of October. The purpose of the meetings is to consider proposals submitted by the public to change the 2012 NESC, which contains regulations for the utilities. Unlike the NEC, the NESC is developed on a five year code cycle.
OSHA has issued a proposed rule regarding silica dust created from cutting building materials. The new proposed rule will reduce the allowed exposure for a worker from 100 micro grams per cubic meter to 50. The new requirement has an eight-hour weighted average, which means exposure to silica is averaged over that period of time. The rule creates expensive new requirements for those businesses with employees exceeding the exposure limit for over 30 days a year.
Contractors hiring workers from a temp agency are responsible to ensure those workers have adequate safety training. OSHA has recently been issuing citations to businesses when temporary workers do not have adequate safety training.
Immigration, a priority for Congress earlier this year, has now fallen to the wayside. After the Senate’s passage of its bill, which arrived DOA in the House of Representatives, no further action has been taken or is planned. Most tellingly, immigration reform was notably absent from a communication released by the Office of House Majority Leader Eric Cantor detailing the chamber’s fall legislative priorities. Meanwhile, news reports surfaced in late September that illegal immigration is on the rise for the first time in more than five years.
IEC also continues to wait for the introduction of a foreign worker visa program that would connect job seekers and employers in the construction industry looking to address gaps in their workforce, which has been spearheaded by Representatives Ted Poe (R-TX) and Raul Labrador (R-ID). IEC supports this legislation and hopes to see it introduced soon; however, it is likely that legislators have missed their window for immigration reform this year if not in the 113th Congress altogether.
Tax Reform, also previously a priority for Congress at the start of 2013, has all but lost the wind in its sails. Senate Republican Leader Mitch McConnell declared tax reform dead for the 113th Congress late this summer, and with resolution of the standoff on Fiscal Year 2014 funding and a debt limit bill legislators’ top priorities, there is little room in the spotlight for tax reform in the six weeks left to this year’s legislative calendar.