PUNCHING IN: Regulatory Road Map, Uber Navigates Courts

Punching In

Monday morning musings for workplace watchers 

By Chris Opfer and Ben Penn


Spring Will Be a Little Late This Year? (Reg Agenda) | Uber Back in Courts | Hill Hustle

Ben Penn: Don’t let the dog days of summer get you too lethargic, because the action is about to accelerate. For one thing, we should be seeing the spring regulatory agenda any day now. Whether it’s regulatory announcements, appropriations progress, Senate confirmation votes, gig economy lawsuits, or lobbying disclosures that gets your heart rate up, this week offers a little something for everyone in the labor and employment sphere. 

The Office of Management and Budget’s new regulation czar Neomi Rao says we can expect the Spring 2017 Unified Agenda of Federal Regulatory and Deregulatory Actions to be published at some point this week, after a long delay. Rao declared it will mark an “historic shift” from past agendas, which typically outline each agency’s regulatory plans for the next 12 months. Per Trump’s “one in, two out” policy, the agenda will for the first time list regulations that agencies intend to eliminate or modify to offset the costs of new regulations, according to a report from our trusty Bloomberg BNA White House reporter Cheryl Bolen

The Trump Labor Department has already announced plans to reconsider a few of the Obama DOL’s higher-profile regs, such as the overtime and fiduciary rules. But the agenda should provide new details on the below-the-radar rules that the Alex Acosta regime has yet to weigh in on.  A few of the prior DOL’s rules to monitor for possible inclusion in the regulatory agenda:

  • Wage and Hour Division 2016 rule implementing Obama’s paid sick leave for federal contractors executive order

  • WHD’s 2011 tip pooling rule, barring certain types of tip sharing arrangements

  • Employment and Training Administration’s 2016 regulation to prevent discrimination in apprenticeships

  • WHD’s 2013 companionship rule extending minimum wage and overtime to home-care workers

What other rules could be on the chopping block? Contact us at copfer@bna.com and bpenn@bna.com or on Twitter: @BenjaminPenn and @ChrisOpfer.

And back to overtime and fiduciaries, Bloomberg Law’s Kristen Ricaurte Knebel will be heading to the National Association of Plan Advisors’ fly-in forum Tuesday for what could be a revealing discussion on the financial adviser conflict-of-interest rule. All ears will be turning to guest speaker Tim Hauser in a session titled “Fiduciary Rule 3.0,” because he's the voice of the Employee Benefits Security Administration in the absence of an EBSA secretary. This Friday, July 21, is the final day to submit comments as part of DOL’s request for information on the rule. 

As one RFI closes, another one on the overtime regulation just might begin. A draft of that RFI has been sitting at the OMB for final review for the past few weeks, so this could be the week it goes live. 

Chris Opfer: There's been some talk in the weeks since former Uber CEO Travis Kalanick was ousted that the ride sharing company might take a kinder, gentler approach to its drivers. That includes by rethinking whether they should be classified as employees rather than independent contractors. Count me among those who don't see that type of change happening unless it's ordered by a court. Or several courts. Uber is trying to navigate several ongoing cases revolving around the classification issue. 

On Friday, the company will try to convince a local judge in Los Angeles to approve a proposed settlement agreement in a lawsuit (Price v. Uber) by drivers challenging their status. The Price case had been on hold pending the outcome of a separate lawsuit (O'Connor v. Uber) in San Francisco. A judge in the O’Connor case rejected a settlement agreement in which Uber said it would pay $100 million to settle class action misclassification claims. It appears that the judge in the Price case is ready to follow suit. 

The Price court last month issued a preliminary order rejecting a settlement that had Uber forking over nearly $7.8 million. The judge in that case said it wasn’t clear whether that was enough money to adequately compensate all the drivers who would be covered. 

Meanwhile, a federal court in North Carolina last week conditionally certified a class action by drivers claiming they should be treated like traditional employees for wage and hour purposes.

Uber is also keeping a close eye on another legal battle over the possible unionization of its drivers. A federal district court in Washington state last week heard arguments over a Seattle ordinance that would give gig drivers the right to unionize, despite their contractor status.

Neither the San Francisco nor the L.A. settlements would require Uber to reclassify the workers.  Some sort of third classification – somewhere between an employee and an independent contractor – is probably the long-term goal for ride sharing companies and other gig employers. It’s also a proposal that has at least some bipartisan interest, although even supporters understand that kind of change would require tweaking a wide range of federal, state and local laws to be effective. 

Not everyone is a fan of that plan. 

“I think third way designations would further undermine employee status not strengthen it,” David Weil, the Labor Department’s wage and hour chief in the Obama administration, recently told me via email. “I favor a clearer more consistent employee designation (modeled on FLSA) that uses an economic realities kind of test across statutes.” 

Of course, the Trump Labor Department just scrapped Weil’s administrator’s interpretation instructing that the vast majority of workers should be classified as employees. What replaces that approach remains to be seen. 

BP: Over on the Hill, the Senate Health, Education, Labor and Pensions Committee will convene July 19 to vote on the nominations of Marvin Kaplan and William Emanuel as NLRB members.  Despite some testy Democratic questioning at their confirmation hearing last week, nothing in our opinion rose to the level that would make the GOP majority panel block their advancement to the Senate floor. 

The HELP Committee hasn’t yet scheduled a vote on deputy labor secretary nominee Patrick Pizzella, whose hearing was somewhat clumsily lumped in with the board nominees. The panel’s two moderate GOP members, Susan Collins (Maine) and Lisa Murkowski (Alaska), were absent from the July 13 hearing. If the centrist duo has time on their health-care focused minds these days to study Pizzella’s background, perhaps they’d take issue with his lobbying to exempt the Northern Mariana Islands – sweatshop conditions and all – from workplace protection laws. 

There are already signs that the anti-Puzder troops are preparing to mobilize against Pizzella. Still, his decades of government service, including as an Obama appointee, makes me skeptical that this crusade will earn Puzder-level traction. 

The House appropriations committee will meet Wednesday to mark up the fiscal year 2018 spending bill, which  calls for 11 percent reductions in DOL and NLRB funding compared with FY 2017. The DOL cut isn’t as dramatic as the 20 percent decrease Trump had suggested. The open question remains: Will any of the labor riders, such as one that would block the NLRB’s broadened joint employer definition, survive?

Finally, I’m keeping my eye out for the July 20 deadline for filing lobbying disclosures for the April-May-June period of 2017. The lobbying reports on labor issues will depict a fuller picture of how the change of administrations has affected employer and employee groups’ attempts to gain influence over regulations, legislation, and personnel appointments.  

We’re punching out. Daily Labor Report subscribers can check in with us during the week for updates. There’s finally a decision in the Google-OFCCP case. Subscribers can read more about that this morning. Martin Berman-Gorvine will be exploring what makes bad bosses so awful. Chris, as my supervising editor, you may want to give that one a close read. See you back here next Monday morning.

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