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Legislative & Regulatory Update, February 2019

February 4 2019

TAUC Legislative & Regulatory Update, February 2019

After the most expensive midterm election season in U.S. history, Washington will have divided government with Democrats controlling the House and Republicans controlling the Senate for the 116th Congress. Disagreements over border wall funding, special counsel Robert Mueller's investigation into Russian interference, and healthcare could get in the way of advancing important legislation and policy issues. The recent five-week partial government shutdown – the longest in U.S. history – raises fears that both sides will have a difficult time finding compromise to undertake the basic functions of government, let alone tackle important issues like addressing the looming multiemployer pension crisis. Hopefully, once the remaining Fiscal Year 2019 appropriation bills are finalized and the fight over funding the border wall is resolved, both sides will recognize that it is in their mutual interest to find opportunities to enact bipartisan legislation that address the challenges and issues facing the nation. But it remains to be seen if that is possible with the 2020 election already getting underway.

As the new Congress gets down to business, here is an exclusive update from TAUC on policy and regulatory issues of vital interest to contractors and the union construction and maintenance industry.

Multiemployer Pensions

Before adjourning at the end of 2018, the co-chairs of the Joint Select Committee on the Solvency of Multiemployer Pension Plans (JSC) announced that they could not agree to a solution. Congress established the committee to address failing plans like the Central States Teamsters plan and the United Mine Workers pension fund. The committee was charged with developing bipartisan legislative recommendations by Nov. 30th of this year to address this crisis that is threatening the retirement security of plan participants and the financial viability of contributing employers.

Prior to the November 30th deadline, the co-chairs of the JSC — Senator Hatch (R-Utah) and Senator Brown (D-Ohio) — had been working to develop a proposal that could garner the support of a majority of the JSC members. In making the announcement, they claimed that while significant progress had been made in addressing the pending crisis, more time was needed to find a proposed solution. The Hatch and Brown proposal was meant as an effort to kick start discussions among members of the JCS, Hatch and Brown released draft principles.

Among other changes, the initial proposal:

  • Did not include a loan program for failing plans, but rather proposed to have orphan liability assumed by the PBGC;
  • Was paid for through a combination of increased premiums and new stakeholder fees on retirees, actives and employers, as well as mandatory annual transfers from the Federal General Fund;
  • Tightened the funding rules for multiemployer plans requiring high contributions from employers and/or benefit cuts;
  • Repealed the Multiemployer Pension Reform Act of 2014 (MPRA), and restored benefits for participants in a plan with a recovery plan that had been approved by the Treasury Department;
  • Raised the maximum PBGC guarantee for a participant with 30 years of service from $12,870 per year to $25,200 per year (effective as of date of enactment of MPRA – including for plans that have a rescue plan in place under MPRA); and
  • Did not include composite plans.

The proposal raised significant concerns from NCCMP, construction employers, building trades unions and many plans. Ultimately, it failed to generate enough support among JSC members to finalize recommendations prior to the November 30th deadline. Members of the JSC pledged to continue working on finding a solution to this crisis this year.

TAUC joined other contractor associations and building trade unions in communicating our serious concerns with the proposal to members of the JSC and congressional leadership. We will continue to meet with members of congress and their staff to ensure that any effort to address the looming multiemployer pension plan crisis is equitable and does not undermine otherwise healthy plans or unnecessarily increase costs to contributing employers. We will also continue to work to ensure that any proposal authorizes the use of hybrid composite plans.

OSHA Electronic Recordkeeping Rule

Late last month OSHA issued a final rule rolling back Obama-era injury and illness electronic recordkeeping requirements. In its 2016 rule, OSHA required employers to annually submit to injury and illness information to OSHA electronically. This was information that employers were already required to record in OSHA Forms 300, 300A, and 301. OSHA sought to use the information from the 300 Logs and 301 Reports to more effectively target its enforcement resources. It was anticipated that OSHA would use the information to initiate on-site inspections against certain employers. Under the new rule, companies with 250 or more employees will no longer be required to submit information from Form 300 (Log of Work-Related Injuries and Illnesses) and Form 301. Instead, OSHA will only require the information on Form 300A – an annual summary of injuries and illnesses The rule has raised concerns with employers, unions, and workplace safety advocates. Business groups expressed concern that the rule addresses only two-thirds of the community's objections to the original regulation. Employers are still required to submit a yearly summary, and the new Trump OSHA rule still fails to adequately protect the data contained in those reports. It is expected that concerns with the final rule will lead to the reopening of previous litigation in the Western District of Oklahoma challenging the original Obama rule and its drug testing anti-retaliation provisions, which were stayed pending the Trump administration's rulemaking.

Worker safety and health groups filed a complaint alleging that OSHA failed to provide a reasoned explanation for the changes and to consider public input properly. Additional lawsuits are anticipated. OSHA Administrator Renominated

Once Again President Trump renominated Scott Mugno to be the Assistant Secretary of Labor for OSHA. Mugno's nomination was returned to the White House after the Senate failed to confirm him prior to adjourning for the session. OSHA has been without an administrator for over two years.

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