Democrats are very happy now - President Obama was re-elected and they kept the majority in the Senate, an impressive feat considering that 23 Democratic seats were at risk during the election (out of 33 total) yet the Democrats managed to pick up 3 additional senators vs. the Republicans. The Republicans also lost seats in the House of Representatives BUT maintained the majority there by a safe margin. If Mr. Obama wants to pass labor legislation, he’ll need to convince a number of Republicans to switch sides, something that didn’t happen during his first term.
Without the support of the House, liberal labor legislation will be very difficult until the next Congressional elections in 2014. Without Republican support, it’s expected that Mr. Obama will continue to use the power of the Department of Labor and other federal agencies to implement his proposals by establishing new ‘guidelines’ or rules for employers while enforcing existing laws more strictly.
Here are some areas where the Obama administration will make it tougher for employers:
1)Equal Employment Opportunity ?
The largest area of complaints to the Equal Employment Opportunity Commission involve retaliation claims by people in protected groups (women, minorities, people over 40 years of age, etc.). In many instances these claims are made after an employer gives a performance warning or terminates an employee for violating company rules or poor performance. It will be much more difficult for employers to defend against claims of retaliation, even for valid employment actions, over the next 4 years.
2)National Labor Relations Board ?
In the past this institution dealt primarily with labor issues, including the review and determination of unfair labor practices. Lately this Board has been exerting its jurisdiction in private sector issues, issuing
decisions restricting employer rights to monitor employee use of social media (Twitter, Facebook, Instagram) and restrict employee access to work places after normal business hours.
Under the new NLRB rules, employers may not easily set rules to prevent employees from posting negative comments about their employer or sharing salary information or other ‘employment-related’ information with each other. The NLRB considers this exchange ‘concerted activity’ and protected by the National Labor Relations Act.
The NLRB has also issued guidelines on proper criminal and credit checks that employers may conduct to evaluate potential new hires. These guidelines prevent employers from using certain criminal offenses to disqualify employees from employment unless the offense is serious and happened in within 3-5 years of potential employment. So it is possible that someone who is denied work because of a theft or assault conviction 15 years ago could file a complaint with the NLRB if he isn’t hired.
3)Union Elections ? Employee Free Choice Act (EFCA)
Many employers thought the Employee Free Choice Act was dead, but unions haven’t given up on certain provisions of this proposed law. While it may not be possible to eliminate the secret ballot for union representation elections, it is possible that the Obama Administration will be able to limit the amount of time an employer has to prepare for an election from 30 days to 14 or less without legislation. This would give the unions a substantial advantage in organizing employees since most employers aren’t prepared to launch a counter-campaign with so little notice. This might allow unions to increase their representation of employees in the private sector beyond the 7% they represent now. (Unions are far more successful organizing public-sector workers).
4)Department of Labor ? Wage and Hour Division:
The Obama Administration is expected to greatly increase enforcement of wage and hour laws, making it far more difficult for employers to classify employees as “exempt” or not eligible for overtime. This could cost employers millions in back pay and damages, especially if a class of employee formerly considered to be exempt from overtime is determined to be non-exempt.
The rules for determining exempt/non exempt are somewhat subjective so no employer can feel they are safe from a class action case in this area.
Charles Krauthammer, political columnist, sums up what employers can expect over the next 4 years.
“What Obama failed to pass through Congress, he enacted unilaterally by executive action…..The American experiment ? the more individualistic, energetic, innovative, risk-taking model of democratic governance ? continues to recede, yielding to the supervised life of the entitlement state.”
Employers will face 2 challenges trying to crawl out of the current recession ? global competition and government expansion of rules and regulations. Obamacare will begin to have a large impact on employer costs in 2014 while the costs of hiring employees or defending against employee claims will continue to increase significantly.
It is said that elections have consequences ? and employers will feel those consequences severely over the next 4 years.