In a little more than a month, President Biden has already implemented important changes to labor and employment policies that will have significant implications for employers. As the Biden administration continues to reverse the previous administration's policies and signal more changes over the coming months, employers need to be ready to align their business practices with new statutes and related regulations. Below are some key takeaways for employers.
Occupational Safety and Health: Within his first few days in office, President Biden signed an executive order directing the Occupational Safety and Health Administration (OSHA) to issue new guidance on workplace safety to protect workers from COVID-19. The executive order also directs OSHA to consider whether any emergency temporary measures on COVID-19 are necessary, such as wearing masks in the workplace, and issue the standards by March 15, 2021. In addition, the executive order sets out requirements for increasing OSHA's enforcement efforts related to COVID-19 workplace violations. In response to the executive order, OSHA has already issued its updated guidance to employers on workplace safety and may issue temporary emergency measures by March 15, 2021. The Office of Inspector General at the Department of Labor issued a report at the end of February that is critical of OSHA's level of enforcement during the pandemic. The report expresses concern over the lack of on-site inspections, particularly in response to employee safety complaints. Employers should expect increased inspections and enforcement in the near future.
Wage and Hour: During his campaign, President Biden pledged to increase the federal minimum wage from $7.25 per hour to $15 per hour. On January 22, President Biden issued an executive order directing the Office of Personnel Management to report to the president with recommendations to promote a minimum wage of $15 per hour for federal employees. The Biden administration is also pushing legislation to raise the federal minimum wage to $15 per hour for all private sector employees. Under the current proposal the minimum wage would increase to $9.50 per hour immediately and gradually increase to $15 per hour by 2025.
Employers should also expect a return to a more assertive examination of their wage and hour decisions—including their classification of individuals as independent contractors. The Department of Labor's Wage and Hour Division quickly moved to delay and potentially revisit efforts by the prior administration to make it easier to classify individuals as independent contractors. Similarly, the Wage and Hour division took steps to delay and potentially roll back rules that provide employers with greater flexibility in taking and administering the tip credit for tipped employees.
Government Contractors: Significant changes are taking place at the Office of Federal Contract Compliance Programs (OFCCP). During the previous administration, the OFCCP declined to request or review employer data on compensation and issued controversial guidelines that placed limits on diversity training for government contractors. The Biden administration made prompt moves to shift the OFCCP's priorities by appointing Jenny Yang as the new director of the program and immediately rescinding the limits on diversity training. Notably, the new director served at the Equal Employment Opportunity Commission (EEOC) during the Obama administration, where she pushed for employer pay data collection. Employers should expect significantly enhanced enforcement by the OFCCP, especially with regard to issues of pay equity.
Educational Institutions: The president has indicated that he is hopeful that schools will be open five days per week for in-person learning by the summer. To that end, the president has issued an executive order directing the Department of Education and the Department of Health and Human Services to provide specific recommendations to educational institutions that complement CDC's guidelines for college reopening. With a full reopening in sight, educational institutions should monitor and plan for developments following the Biden administration's executive order on Preventing and Combating Discrimination on Gender Identity or Sexual Orientation issued on January 20, 2021. While the executive order does not directly concern educational institutions, it paves the way for broader protection based on sexual orientation or gender identity in schools. There are also significant changes on the horizon regarding Title IX complaints against educational institutions. During the Trump presidency, the Department of Education introduced a narrow definition of sexual harassment and implemented a set of rules that educational institutions must follow when handling Title IX complaints, including allegations of sexual harassment and assault. Some of the key controversial provisions under those guidelines allow schools to dismiss allegations that do not meet the narrower definition of sexual harassment; designate a higher, "clear and convincing" evidence standard in determining responsibility for allegations of misconduct; and provide live hearings with cross-examinations for grievance proceedings. President Biden has repeatedly indicated his goal to roll back to more student-oriented, Obama-era Title IX policies. Educational institutions should stay alert for expected changes that will likely require revision of their Title IX policies.
Healthcare Industry: Hospitals were impacted heavily by the COVID-19 pandemic and administrative weakening of the Affordable Care Act (ACA) under the previous administration. As the future of the ACA remains uncertain, the Biden administration will likely focus on patching the ACA by offering a public option and expanding Medicaid and Medicare. One example of this expansion is a COVID-19 special enrollment period for Healthcare.gov that resulted in over 200,000 sign-ups in the first two weeks. In another move aimed at strengthening the ACA, President Biden nominated California's Attorney General Xavier Becerra to head the Department of Health and Human Services (HHS). During his tenure, Bacerra confronted the Trump administration over its restrictions on abortion, opposed hospital mergers, targeted pharmaceutical companies, and advocated for greater government involvement in regulating drug prices. The Biden administration is also expected to increase audits by the Recovery Audit Contractor (RAC). The RAC's mission is to identify and correct Medicare overpayments and improper billing practices on claims provided to Medicare recipients.
As the Biden administration continues to implement many key policy changes, employers are encouraged to check out more in-depth discussions by Venable attorneys on these and other important developments and contact one of Venable's experienced Labor and Employment attorneys with questions.