Trump Administration Curbs Implementation Of Overtime, ACA, EEOC Pay Disclosure Rules

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By Chris Opfer and Christine Pulfrey

A memorandum from White House chief of staff Reince Priebus instructed federal agencies Jan. 20 to freeze all pending regulations, which seems to include some labor and employment initiatives related to payroll that were being worked on by the Obama administration.

Separately, President Donald Trump signed an executive order Jan. 20 that allowed federal agencies to waive, offer exemptions or delay provisions of the Affordable Care Act. The order likely includes employers, which may purchase health-care insurance.

Priebus told the agencies to refrain from sending new regulations to the Office of Management and Budget and to postpone for at least 60 days all regulations that were published but not yet in effect. He also encouraged agencies to “consider potentially proposing further notice-and-comment rulemaking” for any regulations that have not fully taken effect because of legal questions.

The move appears to restrain the Labor Department’s overtime rule that was to take effect Dec. 1, but was delayed, pending the outcome of a federal court appeal. The memo excluded from postponement regulations “subject to statutory or judicial deadlines.” The memo did not mention specific rules, so it was unclear whether the overtime rule was affected, lawyers said Jan. 23.

“It seems possible that the particular regulations fall outside of the memorandum entirely, given that the original implementation date has passed and the current injunction is a separate matter subsequent to the regulatory process,” Caroline J. Brown, a lawyer who specializes in wage and hour law issues at Fisher & Phillips LLP in Atlanta, told Bloomberg BNA.

“The planned ‘effective date’ for the regulation passed, but since it was enjoined it has not officially become ‘effective,'” said Jeffrey Brecher, a lawyer at Jackson Lewis P.C. in New York. “I am not sure how this would play out and if the [department] would interpret this memo as authorizing” a delay.

The rule was to increase the annual salary threshold for exempting certain individuals from federal overtime requirements to $47,476 from $23,660.

Priebus's memo also may pause new pay data disclosure requirements that were to be mandated by the Equal Employment Opportunity Commission.

The EEOC’s pay data disclosure rule ( RIN: 3046-0007), which was unveiled in an executive order from former President Barack Obama, was to require employers with at least 100 employees to disclose summary compensation data grouped by sex, race and ethnicity. The requirement, which would be fulfilled through using Form EEO-1, Employer Information Report, to provide pay data indicated on Forms W-2, Wage and Tax Statement, and data on hours worked, was to take effect starting in 2017, with reporting in 2018.

Reporting the payroll data with Form EEO-1 was intended to make it easier to identify pay discrimination, but critics said the new requirements would create more paperwork for employers and would be ineffective.

The rule is “pretty burdensome and questionable in how it will help carry out the EEOC’s mission,” Reed Russell, the commission’s legal counsel during the George W. Bush administration, told Bloomberg BNA.

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