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Punching In: Shutdown, Overtime, and Joint Employment

Jan. 14, 2019, 11:01 AM

Monday morning musings for workplace watchers

The Lowdown on the Shutdown | A Hush Falls Over the Business Community | A Wrench in the Joint Employer Rule

Chris Opfer: This is Day 24 of the partial government shutdown, making it the longest such hiatus on record. The border wall funding stalemate between the White House and Congress shows no signs of abating. The dispute could eventually move to the federal courts, if President Donald Trump decides to go it on his own and use an executive order to free up $5.7 billion for the project.

That is, if anyone’s around to hear the case.

The federal courts are expected to run out of money as soon as Friday. Judges will continue to hear some criminal cases, but just about everything else will be put on ice. The Equal Employment Opportunity Commission, which is shutdown, is already asking courts to push the pause button on litigation involving the agency.

The closures are also affecting agencies that are still open for business. Appointments for political positions that don’t require Senate confirmation are on hold because the Office of Personnel Management—the government’s HR shop—is shuttered.

Congress is still open for business. Hassan Kanu sat down with Michael Saltsman from the Employment Policy Institute in this week’s Punching In podcast to get one side of the $15 minimum wage debate likely to heat up soon.

Jaclyn Diaz: The business community may have busted out the party hats and noisemakers last week when the Labor Department finally showed signs it’s moving on a policy to expand overtime eligibility. ICYMI: We finally got confirmation that a new overtime proposal is on its way to the White House Office of Information and Regulatory Affairs. For a while there, we were hearing that the proposal was sitting on someone’s desk at the Frances Perkins Building collecting cobwebs.

Creating a new overtime eligibility policy to replace the Obama-era proposal that a court put on hold has been an albatross around the neck of Secretary Alexander Acosta since he took office in 2017. As the administration entered its second year, and there was still no overtime proposal to speak of, the chorus of unhappy management-side stakeholders got louder.

For some time we’ve been hearing rumors of an effort by employer advocates to get Acosta or the White House’s attention about the extent of their frustration with the perceived lack of movement. Now that overtime is in motion, that could be a moot point. Business advocates are still waiting for joint rules on “joint employer” liability and, to a lesser degree, regular rates for overtime calculation purposes.

Plenty of questions still remain on what happens next. The Obama regulation would have roughly doubled—to $47,000 from $24,000—the annual salary below which workers automatically are eligible to earn overtime pay. Depending on what the new salary threshold looks like (I’m taking bets and tips), Acosta can still find himself in hot water from either side of the aisle if the number is considered too high or too low.

CO: Have some thoughts on the National Labor Relations Board’s new approach to joint employer liability? Well now you have more time to share them with the board.

Today was supposed to be the last day to submit comments on the proposed rule, which would limit the circumstances in which multiple businesses can be considered joint employers of a group of workers. But a federal appeals court’s recent surprise decision in the Browning-Ferris case has drawn a dark cloud of uncertainty over those plans. The court upheld a joint employer test created by a Democrat-majority board in 2015 that makes it easier to tag companies as joint employers.

The NLRB has now pushed the public comment deadline to Jan. 28.

The U.S. Court of Appeals for the D.C. Circuit raised new questions about the extent to which the board can determine who is an “employer” for unfair labor practice and collective bargaining liability under federal law. It said courts, not the board, should be setting some broad parameters about how the term is defined in common law.

The court also said that the analysis should at least take into account some forms of indirect control by franchiser companies and those in staffing and other arrangements. Worker advocates have long argued that indirect control is a hallmark of complicated business relationships that leave employees without a seat at the table with the folks who actually help set the terms and conditions of their jobs. The business community says focusing on it creates new legal responsibilities for companies concerning another business’s workers.

The decision is a possible fly in the ointment for the current NLRB, which wants to limit joint employment to situations in which a company has some form of direct control over the workers.

The board cited the “unique circumstance” created by the D.C. Circuit’s ruling as the reason for extending the public comments deadline. What the NLRB eventually does with its joint employer proposal remains to be seen.

We’re punching out. Daily Labor Report subscribers can check in during the week for updates. In the meantime, feel free to reach out to us on any and all labor and employment news:, and or on Twitter: @ChrisOpfer and @JaclynmDiaz.

See you back here next Monday.

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To contact the reporter on this story: Chris Opfer in New York at