Administration Should Trump These Labor Regs
From the National Labor Relations Board’s (NLRB) intrusion into everything from an employer’s rights to regulate employee conduct, to the expansion of non-exempt employees, no area has had a more direct impact on your workplace. And no area may see a more radical shift under the Trump Administration.
Here are some examples:
Concerted Activity: The NLRB arbitrates disputes that involve both union activity and nonunion activity that implicates so called concerted activity. Traditionally this jurisdiction was understood as protecting the rights of nonunionized workers to ban together to address issues of concern in the work place and ultimately not be deterred from forming a union. In contrast, under the Obama Administration’s appointees, concerted activity has been used to regulate everything from punishment of an employee for Facebook postings critical of the boss, to workplace restrictions on sharing salary information. This shift has made your workplace policy manual a tripwire for litigation and made it more difficult to impose common sense restrictions on employee behavior. Let’s hope the NLRB will take a second look at these decisions.
Regulation of Mortgage Originators: For more than a decade now, the courts and the Labor Department have grappled over whether or not mortgage originators are exempt employees. Talk to any veteran of the mortgage industry and they will scoff at the notion that mortgage originators are anything other than exempt employees. After all, if a member calls at 4:55pm wanting to apply for a mortgage loan, no employee in their right mind would tell the applicant to call back tomorrow because their shift is almost over. Nevertheless, the Obama Administration’s Labor Department overruled an interpretation provided by the Bush Administration and opined that in-house mortgage originators are non-exempt employees who must receive overtime. The Supreme Court upheld the right of the Department of Labor to issue this interpretation. The good news is, what the Department of Labor giveth it can taketh away. I hope there will be quick action to reconsider this interpretation so that common sense can once again prevail in the mortgage industry.
Exempt-Employees: The most prominent Labor Department regulation increased the threshold of exempt employees to slightly more than $47,000, and indexed the threshold for inflation. Although it was supposed to take effect late last year, the regulation has been tied up in litigation and it is unlikely to survive the incoming Trump Administration without substantial revisions. Remember that even without the Federal changes, New York State has updated its own exempt-employee regulations
Obligations of Fiduciaries: Last but not least, in April, regulations imposing fiduciary obligations on financial advisors are scheduled to take effect. The outgoing Department of Labor recently issued a memorandum providing questions and answers about the new regulation. This one doesn’t have much of a direct impact on most credit unions. It does, however, on the individuals who provide investment advice to the trustees of your 401(k) plans. By tightening conflict of interest requirements and the fiduciary obligations of outside advisors, there are subtle changes to how your 401(k) plan is overseen. Expect to see changes made to this regulation.
This extensive to-do list underscores how antiquated our labor laws have become. They were created at a time when a good chunk of the workforce was unionized and it was relatively easy to distinguish the white collar worker in the executive suite from the blue collar worker on the assembly line. The most constructive thing the Trump Administration’s Labor Department can do is advocate for changes to the National Labor Relations Act and the Fair Labor Standards Act so that classifications such as exempt and non-exempt employees can reflect the modern workplace.