Tax Reform Gets Under Way; Special Interest Groups Already Bustling. As soon as the Republican-controlled Congress cast aside (however momentarily) its attempts to repeal the Affordable Care Act (ACA) to focus on tax reform, K-Street lobbyists commenced their expected trek to the Capitol. Apprehensive that their pet tax deductions might be in danger, representatives of special interest groups began clamoring for lawmakers’ attention. Judging from initial reports, the Republican proposal would lower the corporate tax rate, lower the top personal income tax rates, eliminate the alternative minimum tax and estate tax, and—in Steven Mnuchin’s words—eliminate “lots of deductions.” Though vague on detail, a blueprint released last week seemed to indicate that certain cherished tax deductions, such as deductions for mortgage interest and charitable giving, might be at least somewhat safe. Importantly for the employee benefits industry, so are—for now—“tax breaks for retirement plans.” Everything is subject to change, and the actual value in dollars of some of these deductions might be diminished if, as expected, the standard deduction is doubled or otherwise increased. In response to the intense lobbying efforts, Republicans are already seemingly backing off from a proposal to eliminate the deduction for state and local income taxes, which disproportionately affect residents of states having high income tax rates. Industry is certain to attack each and every proposed elimination tooth and nail, and it should be interesting to see which cuts—if any—remain at the end of the day.
Arbitration at the Supreme Court. On Monday, October 2, the Supreme Court of the United States kicked off its October 2017 term by hearing oral argument on the legality of class action waivers in employment arbitration agreements. My colleagues have the play-by-play of the oral argument in the three cases dealing with this issue that have been consolidated before the Court: National Labor Relations Board v. Murphy Oil USA, Inc.; Epic Systems Corp. v. Lewis; and Ernst & Young LLP v. Morris. As Ron and Chris note, Justice Gorsuch was silent during the argument. Because Gorsuch is still new to the Court, you may be wondering what he thinks about arbitration. Well, according to SCOTUSblog, “Gorsuch’s opinions have interpreted the arbitration clauses in light of the overriding presumption in favor of arbitration.” We’ll have to wait for a decision from the Court to see if this pattern holds. Finally, in an unusual development, National Labor Relations Board (NLRB) General Counsel Richard Griffin, who argued the case for the Board, subsequently sent a letter to the Court correcting answers he delivered in response to Chief Justice Roberts’s “50-employee” hypothetical (regarding a hypothetical agreement permitting collective arbitration only when at least 50 employees join the arbitration) noted in Ron and Chris’s article.
Groundhog Day for “Agency Fees.” In more Supreme Court news, late last week, the Court agreed to hear a new challenge to so-called “fair share” or “agency fees” that nonmember public sector workers pay to unions as a condition of employment. There is more, including an explanation of why this issue transcends the public sector (spoiler alert: like everything else, it’s about the money).
Joint-Employer Bill Clears Hurdle. On October 4, the U.S. House Committee on Education and the Workforce reported out H.R. 3441, the Save Local Business Act, on a party-line vote of 23–17. The Save Local Business Act will tighten the joint-employer standards in both the National Labor Relations Act and the Fair Labor Standards Act. The bill has 95 bipartisan cosponsors, including three Democrats: Henry Cuellar (D-TX), Luis Correa (D-CA), and Collin Peterson (D-MN). In addition to a whole swath of industry associations and right-leaning groups, the Southern Christian Leadership Conference is also supporting the bill. The next stop would be a vote on the House floor, though whether Republican leadership will bring up the bill is unclear.
Immigration Matters. Here are some immigration tidbits from this week:
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On October 2, comments were due on the U.S. Department of Labor’s (DOL) proposed changes to the Labor Condition Application. The U.S. Chamber of Commerce requested that the DOL withdraw the proposed changes and instead propose them, if at all, via the Administrative Procedure Act rulemaking process.
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On October 3, U.S. Citizenship and Immigration Services (USCIS) announced that premium processing will now be available for extensions of H-1B status, the final category of H-1B petitions to become eligible for premium processing treatment after a lengthy suspension. Click here for the details.
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On October 4, the House Homeland Security Committee reported out the Border Security for America Act, H.R. 3548. Among other provisions, the bill would provide $10 billion in funding for a border wall.
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October 5 was the deadline for current Deferred Action for Childhood Arrivals (DACA) program recipients to apply for renewal of their benefits. The U.S. Chamber of Commerce and SHRM, among other groups, continue to push Congress for a quick resolution of the matter.
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Also on October 5, the Senate confirmed Lee Francis Cissna to be USCIS director.
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Representative Lamar Smith (R-TX) has an op-ed in The Hill on his bill to require all employers to use E-Verify.
Senate Nominations Hearings. As the Buzz previously reported, on October 4, the Senate Health, Education, Labor and Pensions (HELP) Committee held a confirmation hearing for Cheryl Stanton (to be the DOL’s Wage and Hour Division administrator), David Zatezalo (to be assistant secretary of labor for mine safety and health), and Peter Robb (to be general counsel for the National Labor Relations Board). A vote in the committee will be the next step, and the Buzz expects that the full Senate will vote by the end of the month to ensure that Robb steps in immediately upon the expiration of current general counsel Richard Griffin’s term on October 31.
DOL Solicitor. Late last week, President Trump announced his intent to nominate attorney Kate S. O’Scannlain to be solicitor for the Department of Labor. Currently, Nicholas C. Geale is serving as both acting solicitor and chief of staff for Secretary of Labor Acosta. A confirmation hearing for O’Scannlain has yet to be scheduled.
EEOC Training. Readers may recall that in 2016, the Equal Employment Opportunity Commission (EEOC) released its report from its Select Task Force on the Study of Harassment in the Workplace. As a follow-up to the report, on Wednesday, October 4, the EEOC unveiled two training programs for employers called Leading for Respect (for supervisors) and Respect in the Workplace (for all employees). The programs are intended to focus on “respect, acceptable workplace conduct, and the types of behaviors that contribute to a respectful and inclusive . . . workplace.” No word on whether the training will instruct employers on how to inoculate their workplace civility policies from NLRB scrutiny.
Of Mice and Congressmen. Washington D.C.’s rodent problem might not be as bad as New York City’s, but it’s still pretty bad. The Capitol Hill area is particularly infested—and we aren’t just referring to the politicians and lobbyists. Some speculate that a 10-year restoration project of the Cannon House Office Building has led to an influx of vermin in the three House office buildings (Rayburn, Cannon, and Longworth). However, with Congressional approval ratings nearing all-time lows, cynics may say that the rodents are simply abandoning the sinking ship that is the 115th Congress.