Labor Chief Acosta Embraces Limited Government View on Rulemaking

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By Ben Penn

Labor Secretary Alexander Acosta criticized “executive overreach” and called for public input to help reconsider regulations in a July 21 speech before the American Legislative Exchange Council.

The secretary cited two recent wage-and-hour actions—the withdrawal of guidance documents and a request for public input on the overtime rule—as examples of the Labor Department’s efforts to limit the administrative state. Acosta delivered the remarks in Denver at the conservative organization’s annual meeting. ALEC advocates for the reining in of government agency rulemaking.

The DOL provided no explanation last month when it withdrew two controversial administrator interpretations on joint employment and independent contractor misclassification, saying only that employers are still bound by the Fair Labor Standards Act. But Acosta tackled the issue head on for ALEC representatives, describing the decision as motivated by limited-government principles.

“As you know, the administrative state has grown and grown and grown in power, and it has seized far too much power,” Acosta said. “The use of guidance documents to broadly impact rights and responsibilities, rather than formal lawmaking and rulemaking, deprives individuals like you and your constituents the opportunity to voice your concerns.”

The Obama administration’s Wage and Hour Division, under the direction of David Weil, argued the documents helped to clarify established law without changing the rules. Weil explained that most workers should be classified as employees, rather than independent contractors, for minimum wage and overtime eligibility purposes. He also said that joint employer liability for affiliated businesses in wage cases should be read broadly.

But the interpretations were considered by employer groups and GOP lawmakers to be regulations in disguise that sidestepped the notice and comment process.

Acosta also updated ALEC representatives on the DOL’s ongoing reconsideration of a high-profile Obama rule that was intended to expand overtime pay access to an estimated 4.2 million workers. He asked for attendees to share their views on how the DOL should revise the rule by submitting comments through a formal request-for-information process.

That request for information was sent to the White House for review and is now cleared from the Office of Management and Budget website, meaning its publication is imminent.

The secretary used the bulk of his speech to urge states to loosen occupational licensing policies that he said prevent qualified workers from holding jobs.

To contact the reporter on this story: Ben Penn in Washington at bpenn@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Chris Opfer at copfer@bna.com

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