Andrew Puzder seems to favor management over labor.
If Andrew Puzder’s selection as secretary of labor is confirmed by the Senate, a new age of the US Department of Labor will be upon us—and there could be significant ramifications for both our workforce and the economy.
As an early supporter of the Trump administration, Puzder has usually favored management over labor, although he often takes pragmatic positions when it comes to balancing the interests of workers and employers. He has been a frequent commentator on the state of the American workforce, and is widely known as a critic of the Affordable Care Act, the new overtime rule, a higher minimum wage and other business regulations that he views as stifling growth in the industry. As secretary of labor, it’s likely that Puzder would push to curtail the DOL’s enforcement and oversight role, and systemically “right-size” the DOL into an agency that reflects greater deference to the marketplace on regulatory matters.
The Role of Labor Secretary in the Workplace
In this Cabinet-level position, Puzder would head up the DOL and serve as the federal government’s chief workplace regulator and negotiator with its public employee unions. From day one, Pudzer would have the power to shape a wide range of DOL regulations and policies that could have a profound impact on the American workplace. The DOL enforces federal laws governing employers and unions and, perhaps more importantly, creates regulations that direct the enforcement of a variety of workplace laws.
Although the DOL covers more than 30 agencies, the four most likely to be impacted under Pudzer are the Wage and Hour Division, Occupational Safety and Health Administration, Office of Federal Contract Compliance Programs and Office of Labor-Management Standards.
An Overhaul of Wage and Hour Regulations
Overall, employers can anticipate decreased wage and hour enforcement by the DOL under Pudzer. Although he clearly opposes “significant” minimum wage increases, Puzder does favor a tiered system that retains a lower minimum wage for entry-level workers, likely in the range of $8.75 to $10 per hour. On the other hand, Pudzer’s position on the new overtime rule is less flexible. He would likely scrap or substantially rework the rule, having cited that it would force many employers to offset increased labor expense by cutting costs elsewhere.
Scaling Back OSHA’s Enforcement Role
As labor secretary, Pudzer would undoubtedly put a number of OSHA’s most recent regulations under the microscope. First and foremost, Pudzer would roll back OSHA’s new injury and illness reporting requirements and the increases in penalty fines, which have been the target of significant criticism by employers who consider them to be overly broad and burdensome. In addition, an overhaul to the agency’s whistleblower protection program could occur, with Puzder ratcheting the employee’s burden of proof standard back up to a level more acceptable to employers.
Changes to OFCCP Regulations
Although Pudzer isn’t expected to reverse the OFCCP’s affirmative action regulations put into place under the Obama administration, he’ll likely push to negate some of the more onerous executive orders, including the:
In addition, although there is a strong chance that Puzder would support eliminating the new EEO-1 reporting requirements on pay equality practices, companies with more than 100 workers should continue to review their compensation plans to ensure compliance with anti-discrimination laws. However, given the undue burden and expense posed by the new requirements, recordkeeping of this type would undoubtedly be viewed by Pudzer as unnecessary and disposable.
More Power to the OLMS
Over the past eight years, unions have gained a significant advantage on the organizing front and secured greater power at the bargaining table. The permanence of current union-leaning regulation in areas such as expedited elections, employee handbook compliance, franchisor liability and enforcement case handling would all stand in the line of fire under Puzder. In addition, DOL resources would likely be diverted back to the OLMS, which enforces union disclosure requirements. Under the Obama administration, OLMS suffered a 44 percent reduction in full-time employees. We can expect that Puzder would likely work to once again beef up the OLMS—which could spell trouble for unions by heightening transparency.
The current political landscape presents a unique opportunity for Puzder. Although these regulation changes could take years to implement, one thing is certain—employers can expect a pro-management approach to steering the DOL under Puzder.
Mathew Parker is an associate attorney at the Columbus office of Fisher Phillips, a national management-side labor and employment law firm.