The D.C. Download, April 2023

April 28 2023

Government, Legislative Affairs, TAUC News

House Education and the Workforce Subcommittee Hearing on Independent Contractors

The House Education and the Workforce Subcommittee on Workforce Protections held a hearing on the Biden Administration’s pending worker misclassification rule and its potential impact on independent contractors. The Committee’s republican majority highlighted the rule as part of the Biden Administration’s “war on independent contractors.”

The proposed rule, which would establish a new standard for determining whether a worker is an employee or an independent contractor under the federal Fair Labor Standards Act, is expected to be finalized soon. TAUC and the Construction Employers of America (CEA) submitted comments in support of the proposed rule. We also submitted letters included in the record for the hearing outlining the rampant employee misclassification in the construction industry and its  negative impact on union contractors and taxpayers.

Department of Labor Nominations

• Secretary — President Biden’s nominee to replace Marty Walsh has Secretary of Labor, Julie Su, recently had her hearing before the Senate Health, Education, Labor, and Pensions Committee. Su, who is currently the Deputy Secretary of Labor, is facing significant opposition to her confirmation. More than 30 trade groups and Republicans on the Hill have rallied against Su. They have tried to portray her as anti-independent contractor for her work on California’s employee classification measure.

All 49 Republicans are expected to oppose her, and key Democratic moderates remain undecided on her nomination. Senators Joe Manchin (D-WV) and Jon Tester (D-MT) are facing competitive re-election campaigns and have voiced reservations about Su’s nomination. Senator Kyrsten Sinema (I-AZ) has also not indicated how she plans to vote.

The timing of Senate consideration of the nomination is not clear at this point.

• Administrator of the Wage and Hour Division — The Senate Health, Education, Labor, and Pensions (HELP) Committee voted 12-9 to advance the nomination of Jessica Looman to serve as Administrator of the DOL’s Wage and Hour Division (WHD). Looman currently serves as Principal Association Administrator of the WHD and previously served Commissioner of the Minnesota Department of Commerce and Executive Director Minnesota State Building and Construction Trades Council. Her nomination has board support in the union construction industry. TAUC and the CEA have sent letters of support of her nomination. The bipartisan vote in committee is a positive sign for the nomination, which will need to be approved by the full Senate. 

• Employment and Training Administration Administrator — The HELP Committee has also advanced the nomination of Jose Javier Rodriguez to be Administrator of the Employment and Training Administration. The vote on the nomination was 11-10.

Legislation Introduced to Repeal the Davis-Bacon Act

Legislation has been introduced in the House to repeal the Davis-Bacon Act. H.R. 720, the “Davis Bacon Repeal Act”, introduced by Representative Good (R-VA), would eliminate all prevailing wage coverage on Federal funding or assisted construction projects. TAUC joined with the CEA in sending letters in opposition to the legislation arguing that it would create an unlevel competitive playing field and would lead to a race to the bottom in the construction industry.

There is no timetable for consideration of this legislation. We anticipate that there will be numerous attempts to prevent the application of prevailing wage requirements during consideration of annual appropriations bills later this year. 

Comment Period Ends for Proposed Non-Compete Rule

On Wednesday, April 19^th, the comment period ended for the Federal Trade Commission’s proposed ban on non-compete employment agreements. More than 25,000 comments were submitted during the period by a combination of unions, consumer advocates, progressive groups, and business organizations. Groups in favor of the rule argued that the FTC should go further. The groups argued training repayment rules, where departing workers must reimburse their employers for the money they invested in training, should also be included in the rule. The use of this tactic, which some studies say affects 1 out of every 10 employed Americans, has been growing in recent years. Extensive notice periods and damage clauses, where employees must pay fines if they leave a job before a certain amount of time, were also targeted by the support groups.

DOL Announces $80 Million In Funding For Infrastructure Job Development

On Wednesday, April 5^th, 2023, the U.S. Department of Labor announced the availability of $80 million in funding through the Building Pathways to Infrastructure Jobs Grant Program. The grants, which will range from $500,000 to $5 million, will fund private and public sector efforts to build workforce training programs. The training programs will prepare job applicants for the incoming influx of jobs in advanced manufacturing, construction, technical services, transportation, and renewable energy. Nonprofits, labor organizations, institutions of higher education, and state, county, and local governments can apply for either development track or scaling track grants.

• Development track grants will establish local and regional partnerships that will implement new sector-based training programs across the infrastructure sector.
• Scaling track grants will expand upon existing local or regional training partnership models in specific transportation-related sectors at the state or national level.

In total, this program will make $200 million in funding available over multiple rounds.

DOL Announces $5 Million To Increase Women In Apprenticeships

On Friday, April 14^th, 2023, the U.S. Department of Labor (DOL) announced $5 million in funding to attract and support women’s enrollment in Registered Apprenticeship programs. Up to 14 grants will support women’s involvement in industries such as construction, manufacturing, and cybersecurity. The Women in Apprenticeship and Nontraditional Occupations grants are administered by DOL’s Employment and Training Administration and Women’s Bureau.

Currently women only represent approximately 14% of people in Registered Apprenticeship programs. The current round of funding aims to tackle that disparity at a time when Bipartisan Infrastructure Law funding has driven the need for more construction workers. Applications are due May 29^th, 2023.

$44M Available For Job Training In Rural Communities

On Friday, April 14^th, 2023, the U.S. Department of Labor (DOL) announced $44.2 million in funding for Workforce Opportunity for Rural Communities (WORC) initiative demonstration grants. The WORC program seeks to help communities in Appalachia, Lower Mississippi Delta, and Northern Border Regions create and retain good-paying, high-quality jobs. This marks the fifth round of funding available through the program, which has invested $122 million in rural communities. Grants will range from $150,000 to $1.5 million and fund career training and other services. Applications are due June 13^th, 2023.

FTC Announces Change in Policy to Allow Independent Contractors to Collectively Bargain

On Monday, April 10^th, 2023, FTC commissioner Alvaro Bedoya announced that independent contractors are not barred by antitrust law from collectively seeking better pay and working conditions. The announcement marks a shift in the FTC’s policy, which had prevented independent contractors working for Uber from collectively bargaining in 2017. In his statement, Bedoya argued that antitrust law and the courts, which normally restricts independent contractors from forming unions, have interpreted labor exemptions too narrowly, and contractors who primarily work for one company should be exempt.

Currently, the FTC has three Democratic commissioners and zero GOP commissioners. Under its current leadership, the FTC plans to continue pursuing antitrust issues.