Human Resources News & Insights

Five key areas to watch during Obama’s second term

What’s ahead for employers during President Obama’s second term? In this guest post, a group of employment attorneys from the law firm Cozen O’Connor collaborate to tell us what to expect. 

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One of Barack Obama’s first actions when he became president was to sign the Lilly Ledbetter Fair Pay Act of 2009, resetting the statute of limitations each paycheck for equal-pay gender discrimination lawsuits and making it easier for employees to pursue them.

More such pro-employee laws were expected to address such issues as gender-based income disparities, sexual orientation discrimination and easier union representation voting.

These bills never become law, largely due to political realities in Congress.

Instead, the Obama Administration advanced its workplace agenda through administrative agencies such as the Department of Labor, National Labor Relations Board and the Equal Employment Opportunity Commission.

Indications are that this emphasis will continue in Obama Administration 2.0, especially in the following five areas.

EEOC Claims

The Equal Employment Opportunity Commission (EEOC) has increased its enforcement efforts. During the 2012 fiscal year, nearly 100,000 charges were filed, and the EEOC recovered over $36 million from employers.

The EEOC’s new strategic plan emphasizes supporting claims that allege hiring and recruitment discrimination, retaliation against employees who pursue legal rights, discrimination under the Equal Pay Act and Americans with Disabilities Act, systematic harassment and human trafficking.

Based on this plan and the EEOC’s recent cases, disability and recruitment discrimination claims will likely be the primary focus during President Obama’s second term.

Wage and hour law

The Department of Labor (DOL) Wage & Hour Division (DOL) continues to make enforcing the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA) a top priority.

Expect continued DOL focus in the next four years on eradicating unpaid working time due to alleged misclassification of employees as independent contractors or as overtime-exempt.

Moreover, we should continue to see more collective action FLSA suits, which allow hundreds and, in some cases, thousands of employees to join a case filed by just one employee.

This enforcement scheme substantially increases an employer’s exposure by aggregating nominal individual claims actions seeking millions of dollars in overtime or minimum wage compensation. Targeted industries like construction and transportation may see more such lawsuits during the next four years.

Labor Relations

Last January, in Noel Canning v. NLRB, the D.C. Circuit Court of Appeals held that President Obama’s three recess appointments to the NLRB in early 2012 were constitutionally invalid.

The court’s ruling jeopardizes the enforceability of nearly 1,000 mostly pro-union NLRB decisions issued by the Board since Jan. 3, 2012. On March 12, the National Labor Relations Board decided to ask the Supreme Court to review the Noel Canning decision.

Because the case involves the separation of powers, there is a good chance the Supreme Court will consider its validity during Obama’s second term. Meanwhile, the enforceability of the decisions issued after Jan. 3, 2012 remains uncertain.

Health care

The mandates and penalties imposed by the Affordable Care Act (ACA) will be a major headache for employers. Starting in 2014, employers with more than 50 full time employees are required to provide health insurance or else pay a penalty if at least one employee joins the ACA’s insurance exchange and receives a subsidy.

And an employer that has 50 or more full-time employees, doesn’t offer “qualified” coverage and has least one full-time employee will be assessed a “free rider” penalty.

Immigration

During his 2013 State of the Union Address, President Obama stressed immigration reform to attract more skilled labor and establish a “responsible pathway to earned citizenship” for undocumented workers.

Legislation now in Congress, the I-Squared Act, also emphasizes steps to help employers recruit and retain highly skilled workers.

However, with more than $87 million in immigration enforcement fines and sanctions against companies since 2009, employers must remain proactive about employment verification by conducting internal I-9 audits, and reviewing and revising current I-9 policies as needed.

Such preparation typifies what every employer must do in the key areas of employment law discussed here in order to cope with Obama Administration 2.0.

Charles H. Wilson, David Barron, Nelsy Gomez, Dan Schuch, George Voegele Jr. and Michael Schmidt are members of the law firm Cozen O’Connor.

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