The New Trump Administration: It’s Not Just the ACA – What Employers Should Be Watching

Now that the inauguration festivities are over, the Trump Administration has promised to work quickly to bring about significant change for American workers and employers. President Trump wasted little time as his first Executive Orders were signed immediately following his swearing-in ceremony. Although much focus has been placed on President Trump’s pledge to repeal and replace the ACA and to “build the wall,” there are many other items on President Trump’s First 100 Days agenda to which attention should be paid by employers. Aside from ACA changes, here are a just few issues that bear watching by employers:

New Overtime Rules – The new Department of Labor rules revising the “white collar” overtime exemption under the Fair Labor Standards Act (FLSA) remain in question. The nationwide preliminary injunction that blocked implementation of the rules is being challenged in the 5th Circuit. Regardless of the legal outcome of this challenge, many believe that the Trump Administration will work toward further rule-making to roll back the revisions and/or to create a small business exemption from the rule.

Proliferation of State and Local Employment Law Regulation – With Congress passing no significant employment laws during the last six years, the Obama years saw an increase in state and local governments passing laws and ordinances affecting many workplace changes such as minimum wage, paid leave and others. The result has been a “patchwork” of laws and ordinances that have been challenging for employers to follow. With Republicans winning the White House and a majority in the Senate, the prospects for new federal employment legislation during the Trump administration seem even more remote. As a result, we expect additional state and local employment laws, particularly in “blue” states.

Misclassification Initiative – Under the Obama Administration, the Wage and Hour Division of the Department of Labor worked closely with over 30 states to pursue alleged violations of Wage and Hour laws when “employees” were classified as “independent contractors.” Experts are predicting that the Trump Department of Labor will likely reverse the trend of opposition to independent contractors and those who contract with them. Multi-state employers must be mindful, however, of state laws. States such as California, Illinois and Massachusetts recently passed legislation that support or otherwise facilitate claims of misclassification.

Paid Maternity Leave – During and after the election, President Trump suggested a federal mandate that would require companies to provide six weeks of paid maternity leave. Thus far, it is unclear that this benefit would apply to fathers or adoptive parents. Expect resistance from Republican lawmakers on this issue of paid leave.

E-Verify – It appears likely that the Trump Administration will support nationwide use the employment eligibility verification system known as E-Verify by all private employers. It is not as clear whether this mandate will garner enough support from Congress.

Increase in Prevailing Wage for H-1B Visas – H-1B Visas are visas that are issued to foreign workers with specialized knowledge. President Trump has indicated support for an increase in the prevailing wage for such visas. In accordance with his “America First” pledge, look for a requirement that employers significantly increase their effort to advertise to and hire Americans before H-1B visas will be made available.

Clark & Gotzler will closely monitor these and other legislative changes that effect the workplace. Our attorneys are ready to guide employers with planning for compliance.