United States: Potential Shifts In Employment Law Under The Trump Administration

With stories of "fake" news, agency leaks and Russian election influence continuing to dominate the headlines, the Trump Administration's impact on the employment law landscape is not getting much attention. However, savvy employers, executives and insurance professionals are monitoring how the new administration will impact, and in some cases likely remarkably change, the employment law landscape.

Immigration Reform: In terms of policy positions, immigration reform has been the early mark of President Trump's Administration. While the highly publicized ICE raids in early 2017 were likely in the offing before President Trump took office, many expect ICE to increase staffing and expand enforcement and detention actions under the new administration. Employers anticipate an increase in the number of raids and department audits, which could result in employee shortages and penalties. While such efforts would likely impact industries using less-skilled foreign workers, such as farming, manufacturing or hospitality, change also may be afoot for employers using skilled immigrant workers.

President Trump has commented on his desire to eliminate abuse in the H-1B program, which is designed to give American employers access to highly skilled foreign workers. More recently, lawmakers introduced legislation aimed at increasing the floor for minimum, prevailing wages for such workers, which would curtail the ability of businesses to use these types of educated workers. Employers would do well to audit their immigration practices to ensure hiring practices and documentation are in order in the event of an audit. As they do so, they should consider whether their immigration practices will spur claims. For example, state laws such as California Labor Code §1019 make it unlawful for employers to misuse employment authorization verification systems, threaten false reports to state or federal agencies, or threaten to contact immigration authorities.

Secretary of the Department of Labor: Certainly, President Trump's appointee to Secretary of the U.S. Department of Labor (Department) will directly influence the national employment law environment. His initial nominee, Andrew Puzder, drew attention for his public opposition to raising the minimum wage and perceptions about his experience as the head of a fast-food conglomerate. After Mr. Puzder withdrew amid controversy, President Trump nominated Alexander Acosta, a former labor secretary at the National Labor Relations Board and assistant attorney general in the Justice Department's civil rights division under President George W. Bush.

While many see Mr. Acosta as less controversial than Mr. Puzder, it is widely assumed President Trump will aim to scale back regulatory efforts initiated by the previous administration. President Trump has already directed federal agencies to freeze all pending regulations, including the Department's Overtime Exemption Rule, which would have raised the minimum salary requirement for employees covered by the FLSA's white-collar exemption. President Trump's freeze also impacted the Department's Persuader Rule, which would have expanded the required disclosures for consultants assisting employers with union avoidance and collective bargaining. More recently, President Trump ordered the acting Secretary of Labor to review the Obama Administration−backed "fiduciary rule."

Finally, the Trump Administration may address the Department's enforcement strategies. Under the Obama Administration, the Department increased its staff of investigators dramatically and took up "strategic enforcement" efforts aimed at proactively investigating industries or employers it targeted for investigation (rather than simply responding to complaints as they were lodged by employees). With President Trump issuing hiring freezes and publicly criticizing the size of the federal government, the Department may well scale back these types of enforcement efforts.

Transgender Rights & Discrimination: The Trump Administration recently rescinded student bathroom access guidance issued by the Obama Administration specifying Title IX gave transgender students the right to use bathrooms corresponding with their gender identity. In Gloucester Co. School Board v. G.G., the Supreme Court recently refrained from ruling on the legality of a Virginia school district policy requiring students to use the bathroom of their birth sex because of the current administration's reversal of the federal guidance. At the same time, the Trump Administration recently indicated it did not plan to repeal President Obama's 2014 Executive Order providing protections for gay, lesbian, bisexual and transgender employees of federal contractors. Employers with transgender employees should continue to monitor these developments to ensure they stay in line with federal laws and regulations, while remaining mindful of the many state laws offering such employees even greater protections.

Nomination to the Supreme Court: On April 7, 2017, the U.S. Senate confirmed Hon. Neil Gorsuch for a seat on the U.S. Supreme Court. Judge Gorsuch could serve as a swing vote on several important employment law cases coming before the Supreme Court in 2017, including a series of cases – Ernst & Young v. Morris, NLRB v. Murphy Oil and Epic Systems Corp. v. Lewis – raising the question of whether an employer violates the National Labor Relations Act or Federal Arbitration Act by requiring employees to sign class action waivers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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