The Department of Labor stepping back from some Obama era regulations

It is no secret that many of the rules changes made by the Obama administration were not considered business friendly. It was that administration’s way of making progress on regulation that was held up in the gridlock from Congress. With the Trump administration now in place there is a different agenda and we are already seeing the Department of Labor change direction.

Strip two for every new one

President Trump signed Executive Order 13771 on January 30, 2017, which said “Unless prohibited by law, whenever an executive department or agency (agency) publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed.” To this end we have seen the Department of Labor starting to take action in several areas. This included some OSHA regulations (accident reporting and silica exposure); changes to the “persuader rule” under the NLRB; a fiduciary rule; and the white collar overtime rule. The current DOL under Secretary Acosta has said they are withdrawing the regulations on overtime for salaried nonexempt employees and will be seeking information from the public on what these regulations should be. In a post I wrote July 6th, I said “Secretary Acosta has announced that the USDOL will be seeking a Request for Information (RFI) regarding federal overtime rules.  An RFI is a request for feedback from the general public regarding what is working and what is problematic with regard to a particular set of regulations.”

Many regulations being taken off the table

In an excellent piece by Michael Lotito and Ilyse Schuman, both of Littler, say that the regulations that are going or are gone include:

  • tracking of workplace injuries and illnesses
  • plan to consider how an overtime-eligible employee’s use of electronic devices outside of regularly-scheduled work hours affects employment
  • “right to know” regulations under the FLSA, which would require employers to disclose to workers their status as an employee or independent contractor and how their pay is computed
  • current restrictions on tip pooling by employers that pay tipped employees the full minimum wage directly.

This last one is being lauded by the restaurant industry saying it was “a great development.”

Tip Pooling

In 2011 the Obama DOL had put in place a rule that did not allow tip pooling or sharing. Restaurants had long used tip pooling to help compensate back-of-the-house workers who made sure that servers were able to deliver great food and great service to customers. It was the recognition that delivering food and quality service was a team effort. The Department of Labor’s decision to rescind the rule should eliminate some confusion over the future of the regulation. However, Angelo Amador, executive director of the National Restaurant Association’s Restaurant Law Center warns that the new rule is not in place yet and “until it is published restaurants should still follow previous regulations forbidding tip pooling.”


The current rules are still the current rules

This warning for the restaurant industry is applicable to all industries that will be affected by these rules changes. The current rules are still the current rules and companies have to abide by current regulations until such time they are changed or rescinded. The lawyers from Littler say that:

 The slowed pace of rulemaking does not mean employers will not be subject to additional changes. Employers should pay particular attention to RFIs if they intend to provide input on current rules that might be subject to revision. Overall, however, it appears federal agencies are attempting to stem their rulemaking efforts, giving employers a much-needed break from potentially burdensome requirements.

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