Expanding Federal Administrative Actions Directly Impact Workplace

In observing recent changes to existing administrative decisions, it can be interpreted that the current administration favors expansion of federal oversight and union involvement in the workplace. Whether the changes come about through proposed new regulations or the use of agency litigation to overrule existing regulations that employers have historically relied upon in making decisions, these changes seem to signal an abandonment of relying upon specific Congressional legislative grants of authority, and a corresponding tightening, modification, altering, or expansion of various federal regulatory programs all at once. Three new developments warrant immediate attention from employers.

Overtime for Salaried Employees

On August 30, the Department of Labor proposed a new rule requiring that employees earn at least $55,000 a year to be exempt from overtime pay. The current minimum salary is $35,568. For “salaried” employees who make less than the minimum annual compensation, all work performed beyond 40 hours in a week would be entitled to receive time and a half compensation. Since the employer bears the obligation to maintain accurate wage and hour records, the proposed rule would in essence require employees to punch in and out if they are paid less than the minimum “salary.” Whether the new rules would allow “make up” time (working more than 40 hours in one week to true up for less hours worked in a previous week or for an upcoming planned absence) without incurring the overtime premium is not clear from the proposed rule. The new rule would also establish a new base every three years. Some workers rights organizations objected that the new threshold should be $82,732.

Union Representatives Accompanying Federal OSHA Inspectors

On August 29, the Occupational and Safety Administration proposed an amendment to existing regulations, proposing that union representatives be permitted to accompany OSHA inspectors on physical workplace inspections when “reasonably necessary to aid” any inspection. The proposal would eliminate language that referenced safety engineers and industrial hygienists, expanding it to include “employee representatives.” A previous 2013 policy that permitted union representatives to be a part of OSHA inspections was overturned by a federal district court. The new proposed rule, which some businesses see as a push to expand unions into the workplace, will be subject to White Hose approval.

Restrictions on Employers Reliance of Management Rights to Change Job Terms

On August 30, the National Labor Relations Board issued two opinions which reversed existing precedent allowing employers broad latitude to change terms and conditions of employment without union negotiation. In Wendt Corporation v. Shopmen’s Local 576, the NLRB restricted employer’s unilateral power over working conditions. And in Tecnocap v. United Steel, Allied Steel, and SEIU, the NLRB ruled employers could not rely upon past practice based on a management-rights clause to make unilateral changes after a previous contract expires and while the parties are bargaining a new agreement. The two decisions together eliminated the previous Raytheon Network Centric Systems decision, which afforded employers, using language within a negotiated management-rights provision, from bypassing negotiating any changes in terms and conditions of employment.

Leech Tishman will be hosting a series of Fall 2023 presentations on the workplace impact of recent Supreme Court, federal, and NLRB decisions. Stay tuned for more information.

If you have any questions about these proposed rules, amendments, or opinions, and how it may affect you as an employer, please contact Philip A. Toomey, the National Chair of Leech Tishman’s Employment & Labor Practice Group. Philip can be reached at 424.738.4400 or ptoomey@leechtishman.com.

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Leech Tishman Fuscaldo & Lampl, Inc. is a national, full-service law firm dedicated to assisting individuals, businesses, and institutions. Leech Tishman offers legal services in business restructuring & insolvency, construction, corporate matters, employment & labor, estates & trusts, intellectual property, litigation & alternative dispute resolution, and real estate. In addition, the firm offers a wide range of legal services to clients in the aviation & aerospace, cannabis, emerging cyber technologies, energy & natural resources, entertainment & sports, healthcare, hospitality, and life sciences industries. With offices in Los Angeles, Leech Tishman also has offices in Chicago, Philadelphia, Pittsburgh, Sarasota, Washington, D.C., and Wilmington, DE.