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Biden Labor Policy Goals Slowed by Some Key Agency Vacancies (2)

Jan. 5, 2022, 10:55 AMUpdated: Jan. 5, 2022, 10:29 PM

The U.S. Department of Labor enters the Biden administration’s second calendar year with several vacancies in its leadership ranks and an intensifying confirmation battle over the pick to be the nation’s top wage-hour regulator.

Five members of Labor Secretary Marty Walsh‘s high command were confirmed last year, in addition to an independent inspector general, but seven Senate-confirmed positions remain vacant, including posts leading crucial enforcement agencies.

Nominations are pending in the Senate for all but one of those posts, raising the possibility that Walsh’s leadership team could be almost fully complete in coming months. But Senate confirmations are almost always a drawn-out affair, and prolonged delays could frustrate Walsh’s ability to execute on an agenda aimed at helping workers and boosting pandemic economic recovery, former agency officials and legal observers said.

“It’s not just a political exercise where we’ve got some empty chairs,” said John Pallasch, who ran DOL’s Employment and Training Administration during the Trump administration. “It actually has real-world impact on people who are waiting for those services, who need those services.”

A partisan battle over David Weil, President Joe Biden‘s pick for Wage and Hour Division administrator, could delay confirmation proceedings and hamper potential efforts to take more worker-friendly actions on two of the most pressing questions in labor and employment law—when does an independent contractor qualify as an employee, and in which circumstances are businesses jointly liable for business moves made by contractors or franchisees.

Extended delays in getting other nominees confirmed could affect rollout of other policy shifts, such as efforts to prepare the unemployment insurance system for future upheaval in the jobs market and a rulemaking to consider environmental, social, and corporate governance factors in retirement investing.

Photo Illustration: Jonathan Hurtarte/Bloomberg Law

Tough Road for Weil

None of the department’s nominees is likely to face greater scrutiny than Weil, a critic of gig-economy companies who was bottled up in committee for five months last year amid opposition from Republicans and the business community.

Republican senators pressured the administration last week to drop Weil, calling him “hostile to employers.” And there are questions about whether Weil, who ran the Wage and Hour Division during part of the Obama administration, can win support from all 50 senators who caucus with Democrats after moderate Sen. Joe Manchin (D-W.Va.), a key vote in the divided chamber, privately expressed concern last year about him returning to his former post.

Weil, now a dean at Brandeis University, is outspoken about his belief that many workers in the gig economy and in other sectors are misclassified as independent contractors rather than employees, who are entitled to overtime, minimum wage, and other workplace protections.

The Senate labor committee is scheduled to convene Jan. 12 to consider Weil along with two other DOL picks who were renominated Tuesday after failing to win confirmation last year: Lisa Gomez, to head the Employee Benefits Security Administration, and José Javier Rodríguez, to run the Employment and Training Administration, which oversees the federal-state unemployment system.

Sen. Patty Murray (D-Wash.), who chairs the Health, Education, Labor and Pensions Committee, pledged to expedite consideration of DOL nominees.

“The Department of Labor’s efforts to keep people safe on the job, protect workers’ rights, provide job training, and so much more are desperately needed as we continue to strengthen the economic recovery,” Murray said in an email. “It’s important they have qualified, experienced leadership at every level.”

Filling the Void

While Democrats and others argue that vacancies among high-level staff hinder efforts to help workers and support economic recovery, the department points out that it has qualified career staff doing the job.

“As always, the work of the department continues while additional leaders await Senate confirmation,” a department spokesperson said by email. “Program and enforcement agencies with vacancies rely on the expertise of acting leaders and career civil servants, all of whom closely coordinate their efforts with department leadership.”

The DOL picks had to be renominated after they were sent back to the White House in December, as the Senate closed its business in 2021.

Also renominated Tuesday was Elizabeth Watson, to serve as DOL’s liaison on Capitol Hill. The former senior aide on the House Education and Labor Committee was originally nominated in April but didn’t receive consideration on the floor—the longest delay for any DOL nominee last year. Her nomination won’t require a vote in committee.

Two other DOL nominees from 2021 are pending: Chris Williamson, to run the Mine Safety and Health Administration, and James Rodriguez, for assistant secretary for veterans’ employment and training services.

A Democratic committee aide said that once the panel receives completed paperwork for Williamson’s nomination, Murray will seek to advance him “as quickly as possible.” James Rodriguez was advanced by the committee in a voice vote Dec. 2, but has yet to receive floor time.

Tie Votes in Future?

If last year’s events are any indication, top Senate Democrats will have to closely whip members of their caucus to get Weil and José Javier Rodríguez across the finish line; both nominees were deadlocked in committee in 2021. Party-line tie votes in committee this time would require votes by the full chamber to make them eligible for the floor, with Vice President Kamala Harris serving as a potential tie-breaking vote. Two more floor votes would then be needed to confirm them.

Republicans have criticized Biden’s labor picks as being anti-business.

“Democrats’ divisive leadership choices and the chronically absent Secretary Walsh at the Department of Labor aren’t in the best interest of workers or job creators,” Rep. Virginia Foxx (R-N.C.), ranking member on the House labor committee, said in a written statement.

Under Biden, the Wage and Hour Division has been led by acting head Jessica Looman, a former executive director of the Minnesota building trades coalition. While the agency has revoked business-friendly Trump-era rules on joint employment and independent contractor status, it hasn’t announced plans to issue an affirmative rule in either area. But a big-ticket rule planned for later this year could make millions of more workers eligible for overtime pay.

‘Cadre of Career Employees’

Paul DeCamp, a Wage and Hour administrator during the George W. Bush administration, said the agency’s day-to-day work doesn’t depend on a Senate-confirmed leader.

“In a lot of ways, most federal agencies can function just fine for an extended period of time without a political leader or at least without a confirmed political leader,” said DeCamp, now an attorney at Epstein Becker & Green, P.C. “The Wage and Hour Division has... a cadre of career employees in senior management roles, as well as more junior roles and field roles, that are perfectly capable of carrying out the day-to-day mission of the agency.”

The lack of permanent leadership at the Employment and Training Administration could have a greater effect, given that it has undertaken a big effort to work with states to shore up the nation’s unemployment system amid major processing issues during the pandemic.

Rodríguez, a union attorney and former Florida state senator, has called for revamping the unemployment system to qualify more Americans for benefits, a position that has drawn opposition from Republicans who say that generous aid discourages workers from returning to the labor market.

“When there’s not a full team at ETA, that means we can’t assist the states as much as they need,” said Pallasch, the agency’s Trump-era head.

It puts agency officials in a “very strange position,” he explained, because they’re implementing policies from the previous administration, but don’t have “the discretion to say, ‘Well, we’re going to stop doing this and we’re going to start doing what I think the new team wants to do.’”

(Paragraphs 16 and 18 updated to reflect current status of two DOL nominees. Graphic previously updated with correct photo of Doug Parker, DOL's assistant secretary for occupational safety and health.)

To contact the reporters on this story: Rebecca Rainey at rrainey@bloombergindustry.com; Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editors responsible for this story: John Lauinger at jlauinger@bloomberglaw.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com

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