On December 24, 2009, the Senate returned seven nominations to the White House as it adjourned sine die until January 20, 2010. The returned nominees included Craig Becker, an Service Employees International Union (SEIU) associate general counsel who had been nominated by President Obama to the National Labor Relations Board on July 9, 2009. 

The Senate HELP Committee voted 15-8 in favor of sending Becker’s nomination to the Senate floor, but Sen. John McCain (R-AZ) immediately placed a “hold” on Becker’s nomination, effectively barring a vote on the nomination. Sen. McCain requested a hearing on Becker’s nomination because he had “concerns regarding Mr. Becker’s written views, which indicate that he would prevent employers from having a role in union representation elections in their workplaces by doing away with requiring fair, secret ballot union elections when requested by an employer.” HELP Committee Chairman Tom Harkin (D-IA) stated that a hearing was not necessary and departed from longstanding Senate practice.

According to a Congressional Research Service report, under Senate rules, unconfirmed nominations are returned to the president at the end of a session or when the Senate adjourns for more than 30 days unless the Senate unanimously consents to holding the nomination over until the Senate reconvenes. President Obama’s options include resubmitting Becker’s nomination in January, making a recess appointment of Becker, or submitting a new nominee. The White House has not issued any statement on the return of the Becker nomination.

President Obama’s other two pending NLRB nominees, Democrat union attorney Mark Pearce and Republican Senate staffer Brian Hayes, did not receive floor votes after their unanimous approval by the HELP Committee, but their nominations were not returned to the White House.

On December 19, 2009, President Obama signed the FY 2010 Defense Appropriations Bill (H.R. 3326) into law. The bill, which passed the Senate 88-10 on December 19, 2009, was nearly held up by a strategic Republican filibuster the previous day, achieving cloture by only four votes (63-33). The filibuster was aimed at stalling the progress of Democratic-sponsored health reform legislation concurrently under consideration in the Senate. The House of Representatives had previously approved the FY 2010 Defense Appropriations Bill on September 16 by a 395-34 vote.

The bill includes provisions to extend unemployment and COBRA benefits and also prohibits Defense Department contractors and subcontractors from requiring their employees and independent contractors to agree to arbitrate certain claims. Those provisions are discussed in greater detail in the Washington Labor & Employment Wire’s previous post on the House’s passing of this legislation.

The FY 2010 Defense Appropriations Bill is Public Law No: 111-118.

Core Provisions: This legislation would amend the Internal Revenue Code to modify the rules concerning the treatment of independent contractors to make it more difficult and costly for businesses to incorrectly classify employees as independent contractors.

In addition to significantly increasing the amount of penalties associated with filing tax returns with incorrect information concerning individuals’ employment status, the bill would change the “safe harbor” provisions of section 530 of the Revenue Act of 1978, which allows employers to designate employers as independent contractors for employment tax purposes, regardless of the workers status as an independent contract under common law test, unless the employer has no “reasonable basis” for such treatment. The amended safe harbor provision would only considered a business to have such a reasonable basis for classifying a worker as an independent contractor if it, or its predecessor, has not treated any other individual holding a substantially similar position as an employee since December 31, 1977, and the business’s treatment of the worker as an independent contractor is in reasonable reliance on: (1) “a written determination … addressing the employment status of the individual or an individual holding a substantially similar position” with the business; or (2) ” a concluded examination (for employment tax purposes) of whether the individual (or an individual holding a substantially similar position) should be treated as an employee ….”

If passed into law, the bill would also grant individuals classified as independent contractors the right to petition the Secretary of the Treasury for a determination of their status for employment tax purposes.

Status: Senator J. Kerry (D-MA) introduced the legislation on December 15, 2009, and it was referred to the Senate Committee on Finance.

On Wednesday, December 16, President Obama signed into law the Fiscal Year 2010 Consolidated Appropriations Bill (H.R. 3288).  This omnibus appropriations legislation provides additional funding to the Department of Labor, the National Labor Relations Board, and the Equal Employment Opportunities Commission, among other federal agencies.  The bill passed in the Senate by a 57-35 vote earlier this week, and previously passed the House by a vote of 221-202. 

On December 16, 2009, the House approved the FY 2010 Defense Appropriations Bill by a 395-34 vote. This most-recently approved version of the Defense Appropriations Bill includes provisions to extend unemployment and COBRA benefits and also prohibits Defense Department contractors and subcontractors from requiring their employees and independent contractors to agree to arbitrate certain claims. 

If signed into law, the bill would extend from nine to fifteen months the 65-percent COBRA health insurance subsidy for individuals who have lost their jobs. While the previous extension of COBRA benefits passed by Congress earlier this year applied to individuals who were involuntarily terminated between April 1, 2008 and December 31, 2009, this bill would extend the job loss eligibility date to February 28, 2010. In addition, the bill would extend previously expanded unemployment benefits, including increased payouts and longer duration of benefits, through February 28, 2010.

The Defense Appropriations Bill would also prohibit defense contractors or subcontractors from entering into or enforcing any agreement with their employees or independent contractors that would require them to arbitrate claims under Title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention. This provision would apply to contracts over $1 million that are awarded more than sixty days after the effective date of the Act. The bill would, however, allow the Secretary of Defense to waive this prohibition if necessary to avoid harm to the national security interests of the United States.

The bill now moves to the Senate for consideration. The Senate previously passed a different version of this appropriations bill in October.

On Sunday, December 13, 2009, the Senate approved the $446.8 billion fiscal year 2010 consolidated appropriations bill (H.R. 3288), on a 57-35 vote. The omnibus bill consolidates six of the seven remaining fiscal year 2010 appropriations bills: the Commerce, Justice, Science, and Related Agencies Appropriations Act (H.R. 2847); the Departments of Labor, Health and Human Services, Education and Related Agencies Appropriations Act (H.R. 3293); the Financial Services and General Government Appropriations Act (H.R. 3170); the Military Construction and Veterans Affairs Appropriations Act (H.R. 3082); the Department of State, Foreign Operations, and Related Programs Appropriations Act (H.R. 3081); and the Transportation, Housing and Urban Development and Related Agencies Appropriations Act (H.R. 3288). 

Under this omnibus appropriations bill, the Department of Labor, the National Labor Relations Board, and the Equal Employment Opportunity Commission will all receive increased funding in FY 2010. The Department of Labor’s budget will increase $431 million from FY 2009, the National Labor Relations Board’s budget will increase $20.8 million from FY 2009, and the Equal Employment Opportunity Commission’s budget will increase $23 million from FY 2009. In total, under the bill the Department of Labor will receive $13.3 billion in discretionary funding, the National Labor Relations Board will received $283.4 million, and the Equal Employment Opportunity Commission will receive $367.3 million.  

If signed into law, the bill will also provide funding for the Justice Department’s Civil Rights Division ($145 million), the Federal Mediation and Conciliation Service ($46.7 million), the National Mediation Board ($13.5 million), the Occupational safety and Health Review Commission ($11.7 million), the Federal Mine Safety and Health Review Commission ($10.4 million), the U.S. Commission on Civil Rights ($9.4 million), and the National Council on Disability ($3.3 million).

As noted in the Senate Appropriations Committee summary, the bill would also present additional targeted funding for unemployment insurance program operations ($3.2 billion), dislocated worker employment and training ($1.4 billion), the Department of Labor’s “worker protection” agencies that regulate pensions, mine safety and health, occupational safety and health, wage and hour rules, and federal contractor compliance ($1.6 billion), and military veteran’s employment and training ($256 million).

The House previously approved the omnibus bill on December 10, 2009, on a 221-202 vote. The legislation now moves to the White House to be signed by the President. President Obama is expected to sign the bill.

On December 7, 2009, the Department of Labor’s Employee Benefits Security Administration (”EBSA”) published its semi-annual regulatory agenda for regulations selected to be reviewed or developed over the next twelve months. Included in the agenda are the following significant regulatory items in the final rule and proposed rule stages. While EBSA has published a schedule for these items, the published dates are tentative and subject to change.

Regulations in Final Rule Stage

In December 2009, EBSA intends to issue a final rule clarifying the prohibited transaction exemption created by the Pension Protection Act of 2006. EBSA previously sought written comments and suggestions concerning this rule. The exemption would allow investment advice provided under an “eligible investment advice arrangement” to be provided to participants or beneficiaries of certain individual account plans. As defined in section 408(g)(2) of the Employee Retirement Income Security Act (ERISA), an “eligible investment advice arrangement” covers arrangements under which advisor fees do not vary with the selection of differing investment options, or under which investment options are selected on the basis of statutorily-compliant computer models. The final rule would provide additional guidance as to what types of computer models are satisfactory and would require the Secretary of Labor to create a model fee-disclosure form. EBSA also indicated in its semi-annual regulatory agenda that it plans on issuing a notice of proposed rulemaking in February 2010, which would narrow the scope of the prohibited transaction exemption as initially proposed by the Bush Administration.

On January 5, 2010, the comment period for the interim final rule implementing anti-genetic discrimination in covered group premiums under the Genetic Information Nondiscrimination Act (GINA) will end. The interim final rule was adopted in October 2009 and became effective on December 7, 2009. GINA prohibits group health plans and health insurers from denying coverage or charging higher premiums to an individual based on a genetic predisposition towards developing certain diseases and disorders. The rule provides, among other things, guidance regarding the prohibition on plans and issuers from requesting or requiring genetic testing, as well as the prohibition on the collection of genetic information. In addition to the formal prohibition of genetic-based discrimination, the rule establishes civil penalties under ERISA.

In January 2010, EBSA intends to issue final rules establishing a safe harbor period of seven days during which money withheld by employers or paid by participants for contribution to a plan would not be considered “plan assets” under Title I of ERISA or the related provisions of the Internal Revenue Code. Because plan assets are subject to fiduciary duties and other obligations, the amendment seeks to provide greater certainty to plan sponsors and fiduciaries, as well as plan participants, as to whether particular participant contributions held by an employer constitute plan assets. 

In April 2010, EBSA plans on issuing an interim final rule concerning the implementation of the Mental Health Parity and Addiction Act of 2008. That act requires that annual or lifetime dollar limits on mental health benefits be no lower than medical or surgical benefits offered under a group health plan. In response to an April 2008 Request for Information, EBSA received over 400 comments raising concerns over compliance with these parity provisions. Accordingly, EBSA anticipates issuing an interim final rule that will provide regulatory guidance regarding these provisions. 

In April 2010, EBSA plans to issue a final rule requiring that multiemployer plan administrators provide plan participants, beneficiaries, representatives, or contributing employers copies of written documents relating to the plan’s funding and financial condition within 30 days of receiving a written request. This final rule implements the new plan disclosure requirements set forth in the Pension Protection Act of 2006. EBSA intends to publish a separate regulation at a later date establishing civil penalties under section 502(c)(4) of ERISA for noncompliance with this provision.

In September 2010, EBSA plans to issue final rules implementing portions of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and subsequent related legislation, including the Children’s Health Insurance Program Reauthorization Act of 2009.

In September 2010, EBSA plans to issue a final rule clarifying what information must be provided to plan participants and beneficiaries to allow them to make informed investment decisions. The rule may amend regulations governing ERISA section 404(c) plans. According to EBSA, the rule will specifically cover the disclosure of information concerning plan fees and expenses.

Regulations in Proposed Rule Stage

In June 2010, EBSA plans to issue a notice of proposed rulemaking intended to bring the definition of “fiduciary” in line with the current practices of plan managers, individual plan participants, and investment advisors. Under ERISA’s regulatory definition, a “fiduciary” administers plans by controlling plan operations, selecting service providers and managing plan assets. The rule would amend the definition of “fiduciary” at 29 C.F.R. § 2510.3-21(c) to include individuals rendering investment advice for a fee, as set forth under section 3(21) of ERISA. EBSA is issuing this rule in response to concerns that the current definition of “fiduciary” may inappropriately limit the types of investment advice that trigger fiduciary duties on the part of investment advisors.

In August 2010, EBSA intends to issue a notice of proposed rulemaking that would satisfy requirements of the Pension Protection Act of 2006 by requiring administrators of defined benefit plans to provide annual funding notices to pension plan beneficiaries and participants. Further, in September 2010, EBSA intends to issue a notice of proposed rulemaking that would satisfy requirements of the Pension Protection Act of 2006 by requiring ERISA-covered plans to provide individual pension benefit statements to plan participants and beneficiaries at designated intervals. Under the proposed rule, the designated intervals would differ with the type of account plan.  Individual account plans providing for individual direction would be required to provide quarterly statements, individual account plans not permitting individual direction would be required to provide annual statements, and defined benefits plans would be required to provide statements every three years.

On December 10, 2009, the Senate Committee on Health Education Labor and Pensions (”HELP”) approved President Obama’s nominations for several vacant Equal Employment Opportunity Commission (”EEOC”) positions, including Jacqueline Berrien as EEOC Chair, Victoria Lipnic and Chai Feldblum as Commissioners, and P. David Lopez as General Counsel.  These approvals came less than a month after the HELP Committee’s November 19 hearing on these nominations.

In a statement released December 10, 2009, HELP Committee Chairman Tom Harkin (D-IA) stated that he was pleased to move these nominations forward, as “Americans need committed, capable public servants working full time on their behalf.”

The nominees now move to the full Senate for confirmation. If confirmed, Berrien, Lipnic, and Feldblum would join Acting Chair Stuart J. Ishimaru and Commissioner Constance Barker to round out the five-member Commission. At that time, Acting Vice Chair Christine Griffin will leave the EEOC to serve as the Deputy Director of the Office of Personnel Management.  Although Griffin’s commission expired on July 1, 2009, she has remained as Acting Vice Chair until her replacement could be confirmed.

On December 7, 2009, the Department of Labor (DOL)’s Employment Standards Administration (”ESA”) and Employment and Training Administration (ETA) published their semi-annual regulatory agenda for regulations selected to be reviewed or developed over the next twelve months. Included in the agenda are the following significant regulatory items in the final rule, proposed rule, pre-rule, and long-term action stages. While ESA and ETA have published a schedule for these items, the published dates are tentative and subject to change.

Regulations in Final Rule Stage

In February 2010, ETA plans to issue a final rule to amend its regulations regarding the process by which employers obtain temporary labor certifications from DOL in conjunction with H-2A petitions submitted to the Department of Homeland Security (DHS). The revised rule is intended to undo changes made to the H-2A program by the 2008 final rule, particularly concerning the current attestation-based certification process and the calculation of farm worker wages. ETA issued a notice of proposed rulemaking in September 2009 and extended the comment period to October 20, 2009.

In June 2010, ESA expects to take final action on its proposed rule implementing regulations pursuant to Executive Order 13496, signed by President Barack Obama on January 30, 2009. The regulations propose to prescribe the size, form, and content of the notice that contractors must post to describe the rights of employees under federal labor laws. In August 2009, ESA issued the proposed rulemaking and ended the comment period in September 2009.

Regulations in Proposed Rule Stage

In December 2009, ESA plans to issue a notice of proposed rulemaking pursuant to Executive Order 13495, signed by President Barack Obama on January 30, 2009. This rulemaking would set forth regulations requiring contractors and subcontractors, who succeed a contract for the same or similar service at the same location of a predecessor, to offer employees employed by the predecessor a right of first refusal to employment.

In August 2010, ESA expects to update the recordkeeping regulations under the Fair Labor Standards Act. These new regulations will provide additional information to workers regarding how their pay is computed, and they will focus on employees with “telework” and “flexiplace” arrangements.

In November 2010, ESA may issue additional regulations implementing the new military family leave amendments to the Family and Medical Leave Act included in the National Defense Authorization Act. ESA issued the current regulations implementing the military family leave amendments in January 2009.

Also in November 2010, ESA plans to publish a notice of proposed rulemaking that considers a revised interpretation of Section 203(c) of the Labor-Management Reporting and Disclosure Act. Section 203(c) of the LMRDA creates an “advice” exemption from reporting requirements that apply to employers and other persons in connection with persuading employees about the right to organize and bargain collectively. The proposed interpretation would narrow the scope of the “advice” exemption.

Additionally, ETA plans to publish a notice of proposed rulemaking to alter the current attestation-based certification requirements of the H-2B visa program in November 2010. Currently, prior to the admission of H-2B workers, DOL must certify that there are not sufficient qualified U.S. workers available and that hiring foreign workers will not adversely affect the wages and working conditions of similar U.S. workers. The new regulation will alter the current H-2B program to increase the program’s integrity and strengthen protections of U.S. workers.

Regulations in Pre-Rule Stage

In November 2010, ESA intends to publish a request for information regarding the application of Title IV of the Labor-Management Reporting and Disclosure Act in the context of Internet balloting in union officer elections.

Regulations in Long Term Action Stage

In December 2010, ESA plans to issue an advanced notice of proposed rulemaking to revise the regulations that implement the nondiscrimination and affirmative action provisions of section 503 of the Rehabilitation Act of 1973. This rulemaking would strengthen affirmative action requirements by requiring federal contractors and subcontractors to conduct more in-depth analyses and monitoring of their recruitment efforts of individuals with disabilities.

Also in December 2010, ESA also intends to issue a notice of proposed rulemaking to revise the regulations that implement the nondiscrimination and affirmative action provisions of the Vietnam Era Veterans Readjustment Assistance Act (VEVRAA). The amendments would require that federal contractors and subcontractors conduct more in-depth analyses of recruitment and placement efforts taken under VEVRAA. The amendments would also require the use of numerical targets for affirmative action efforts and would alter record-keeping requirements.

In January 2011, ESA plans to issue a notice of proposed rulemaking to revise the affirmative action requirements of Executive Order 11246 applicable to federal and federally assisted construction contractors. The revisions would update the regulations that set forth the actions to be taken by construction contractors to meet their affirmative action obligations.

On December 7, 2009, the Department of Homeland Security published its semi-annual regulatory agenda for regulations selected to be reviewed or developed over the next twelve months. Included in the agenda are the following significant regulatory items, as well as their expected dates of completion.

First, in February 2010, U.S. Immigration and Custom Enforcement (ICE) plans to issue a final rule on the electronic signature and storage of Form I-9. The final rule will respond to comments and make minor changes to the interim final rule published June 15, 2006. The rule permits employers to complete, sign and store Forms I-9 electronically and also allows employers to scan and store existing Forms I-9 if certain standards are met.

Second, in March 2010, U.S. Citizenship and Immigration Services (USCIS) plans to issue a notice of proposed rulemaking to amend the regulations regarding the processing of nonimmigrant visa petitions subject to numerical limitations. Initially, the program would be used solely for H-1B visa petitions.

Currently, USCIS uses a random selection process to select employers for a limited number of H-1B visa slots. Employers must prepare and file complete H-1B visa petitions before knowing whether they fall within the numerical cap for the visa slots. Under the proposed rule, employers  electronically register for consideration of available H-1B slots and find out whether they’ve been selected to participate in the H-1B program before preparing and filing H-1B petitions. The proposed registration process would thus alleviate administrative burdens on USCIS in processing excessive applications, and it would also alleviate the cost and burden to employers in preparing and submitting H-1B petitions before knowing whether they are within the numerical cap.