A Bird’s Eye View: Trump and Employment Law

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“The stunning rise of Donald Trump to the presidency, effective Jan. 20, 2017, may result in a seismic shift in federal employment law, administrative enforcement, immigration policy, and health care requirements imposed on employers.”

The stunning rise of Donald Trump to the presidency, effective Jan. 20, 2017, may result in a seismic shift in federal employment law, administrative enforcement, immigration policy, and health care requirements imposed on employers. Dramatic shift s may or may not happen immediately. There is no way to predict the impact of the new administration on employment law with certainty. Below are some of the issues that employers should keep an eye on.

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The Ninth Justice

Merrick Garland is no more. While the process may slow via filibuster, Trump will eventually appoint a new Supreme Court justice, who will likely be staunchly probusiness and will seek to reel in federal statutory protections for employees through narrow, conservative interpretations.

For example, there is the issue as to whether an arbitration agreement that requires an employee to waive his or her right to bring a class or collective action, is unenforceable because it arguably violates the employee’s right to engage in “concerted activities” under the National Labor Relations Act (NLRA). The National Labor Relations Board has said “yes,” but there is now a substantial circuit split among federal appellate courts on this issue. Once Trump appoints a new justice, the Supreme Court is likely to grant at least one of the pending petitions for certiorari to resolve the circuit split. It would not surprise anyone if the Court then holds that these sorts of mandatory arbitration agreements do not violate the NLRA. A broad ruling would dramatically reduce the ability of the plaintiffs’ bar to aggressively pursue employment-related class actions.

Trump Nominates More Conservative Lower Court Judges

There are currently an additional 103 vacancies in the federal judiciary. Federal judgeships are lifetime appointments, and it’s possible that the Senate may approve many of Trump’s conservative nominees quickly.

This may result in a gradual conservative shift in the body of employment discrimination case law. For example, Trump’s appointees would be more likely to interpret Title VII of the federal Civil Rights Act, which expressly precludes discrimination on the basis of sex, as inapplicable to discrimination on the basis of sexual orientation. Federal courts have trended in this direction (though the Seventh Circuit has recently signaled that it may issue an en banc decision holding otherwise). Keep in mind, that this does not affect California law, where the Fair Employment and Housing Act precludes employers with five or more employees from discriminating on the basis of sexual orientation.

Administrative Enforcement

A Trump administration will almost certainly cut the EEOC’s budget, handicapping enforcement efforts generally and potentially resulting in a reduced focus on high-impact cases related to broad policies and procedures.

There will likely be reduced attention to pay equity issues, at least from the federal government. It would not be surprising for the new EEOC to rescind the recent change to the federal EEO-1 reporting form, that currently requires the broad addition of W-2 earnings and work hour data.

In the near term, it may be that the Department of Labor regulations recently enjoined by a Texas district court — which had required “exempt” employees to be paid at least $47,476/year — will be revised or rescinded. Although the labor secretary has filed a notice of appeal, it’s easy to imagine the new administration withdrawing it. All employers should watch this closely. Remember, however, that in California, employers with 26 or more employees will still have to pay $43,680/year to exempt employees beginning Jan. 1, 2017.

Work Eligibility for Immigrants

Trump has promised to go aft er immigrants who are currently protected from prosecutorial discretion under DACA (Deferred Action for Childhood Arrivals). These are generally undocumented immigrants who arrived in the United States as children. Will Trump immediately seek to eliminate all protections for persoXns who are applying to work lawfully in the United States? What will Trump propose, if anything, with respect to the H1-B visa program, which is the most widely used program for bringing highly skilled foreign workers into the United States?

The Affordable Care Act (Obamacare)

Trump has waffled on whether he would be willing to keep the more popular provisions of the Affordable Care Act. Trump has said that he would keep the requirement precluding health insurers from discriminating against persons with pre-existing conditions and preserve the option for dependent coverage up to age 26.

Reasonable people agree that everyone should have the opportunity to purchase, or otherwise obtain, health insurance coverage, but Republicans disagree on how (or to what extent) they would repeal or amend the ACA. It is hard to predict what Trump and Congress will do until a consensus emerges that allows the new president to remove pieces of the ACA and replace them with other options for coverage. Employers should keep close tabs on what will be required of them, if anything, and what their options will be to maintain a healthy and productive workforce.  Daniel Ho

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