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Trump’s Plan to Reopen U.S. Puts Labor’s Scalia in Limelight

May 6, 2020, 5:47 PM

Labor Secretary Eugene Scalia’s spot aboard Air Force One for a trip to a Honeywell International Inc. plant in Arizona on Tuesday was the latest sign the low-profile Cabinet member with a familiar last name is primed for an increasingly public role in the Trump administration’s efforts to recover the economy from the coronavirus pandemic.

Scalia’s Labor Department oversees many of the paid leave, workplace safety, and training programs the administration is likely to turn to as President Donald Trump shifts focus from combating the health-care crisis to restarting the nation’s economy. The former corporate litigator, who joined Trump at an event in Phoenix, has been working behind the scenes with governors, lawmakers, and private-sector representatives to coordinate pandemic relief.

Business groups and some Republican officials expect Scalia to get a more public spot in leading the charge to get Americans back to work. That includes pushing for Republicans’ top legislative and policy priority: legal liability protections for companies operating during the pandemic.

Scalia should be at the center of those discussions, “particularly given his experience as a lawyer litigating liability cases,” said Joshua Bolten, president of the Business Roundtable, an association of chief executives of leading U.S. businesses. “Certainly the business community will treat his views with great respect. I think the administration and the Congress should as well.”

Treasury Secretary Steven Mnuchin has been the administration’s face on Capitol Hill during virus-response negotiations, while Scalia was left off of the White House’s coronavirus task force. Still, as the administration’s efforts shift to a new phase, a top Senate Republican aide said the liability-shield discussions are “Scalia’s bailiwick.”

Mnuchin and White House spokesman Judd Deere praised Scalia in separate prepared statements. “His expertise has been extraordinarily valuable to President Trump, Congressional leaders of both parties, and to me,” Mnuchin said.

The labor secretary, who represented companies like Ford Motor Co., Walmart Inc., Bank of America Corp., and Marriott before joining the administration in late September, has already been involved in efforts to expand paid leave and jobless benefits during the pandemic. He’s also butted heads with labor leaders and Democrats, who have accused Scalia of taking a laissez-faire approach to worker safety by opting to issue voluntary guidance instead of new emergency requirements.

“Secretary Scalia has been passive in carrying out” his agency’s mission to help workers, “especially in the midst of the COVID-19 pandemic,” said Rep. Rosa DeLauro (D-Conn.), who chairs the House Appropriations subcommittee on labor. “His failure carries the cost of those who have fallen ill or lost their lives—especially in food processing facilities and grocery stores.”

‘Policy Superstar’

Scalia has held 72 phone calls throughout the coronavirus crisis with governors, lawmakers, and leaders from labor and industry, including the heads of fast-food conglomerate Yum Brands! and United Food and Commercial Workers, Deputy Labor Secretary Patrick Pizzella said in a Monday interview. He’s frequently on the phone with administration officials or advising governors about how they can update state unemployment-insurance software to absorb the skyrocketing number of new jobless claims.

That’s given the veteran employment lawyer a chance to display his policy expertise.

“I think he’s really emerging as a policy superstar. People are really impressed with his knowledge and his management of the Department of Labor,” said Stephen Moore, a member of a council the White House convened to advise Trump on reopening the country. “I wouldn’t be at all surprised if he winds up moving up the ladder in the Trump administration.”

Bolten, also a member of the council, said he observed in person how Trump and Vice President Mike Pence treated Scalia when members gathered at the White House on April 29.

“They accord him I think a lot more respect than labor secretaries typically enjoy,” said Bolten, who was chief of staff to President George W. Bush.

No ‘Political Animal’

Scalia, the son of the late Supreme Court Justice and conservative jurisprudence icon Antonin Scalia, was an unexpected addition to the administration last fall.

The Labor Department vacancy was created by the sudden resignation of Trump’s first labor secretary, Alexander Acosta, who was facing public criticism for his role a decade earlier as prosecutor in hedge fund manager Jeffrey Epstein’s sex crimes case. Scalia left his comfortable perch as a partner at white-shoe law firm Gibson Dunn to return to the department, where he served as chief legal officer in the George W. Bush administration.

The late first-term arrival meant Scalia assumed the role of closer at the DOL. He was tasked with finalizing a number of deregulatory initiatives, leaving little time to pursue an agenda of his own before the November 2020 election. But the virus changed everything.

Scalia now oversees sub-agencies charged with providing paid sick leave and family leave, administering a federal-state unemployment insurance system that is straining to respond to more than 30 million new jobless claims, and enforcing workplace-safety requirements that will become particularly challenging for employers as more people are called back to work at risk of infection.

The public is now getting acquainted with the man whom Chris Spear, president of American Trucking Associations, has known since they served together in the George W. Bush administration.

“When he explains something, it’s not before giving it a lot of thought,” said Spear, another member of the president’s council on reopening America who communicates regularly with Scalia. “Gene does not wing it. He’s probably the least political animal I know.”

Squaring Off With Labor Leader

The Labor Department is “front and center” on a number of “return-to-work issues” facing businesses as states relax shelter-in-place orders, said Glenn Spencer, who heads employment policy at the U.S. Chamber of Commerce.

“What better person to have in the center of those discussions than the secretary of labor, especially one with as deep a background and knowledge of the issues as the secretary,” Spencer said.

But the labor chief is already under fire for his management of the DOL’s Occupational Safety and Health Administration. Worker advocates have accused OSHA of being too lax in its response to the pandemic by ignoring calls to issue emergency safety standards that would be mandatory for businesses.

AFL-CIO President Richard Trumka seized on that issue in a letter to Scalia last week. “Since this crisis began, the Department of Labor and federal government have failed to meet their obligation and duty to protect workers; the government’s response has been delinquent, delayed, disorganized, chaotic and totally inadequate,” Trumka wrote.

Scalia quickly fired back in a sharply-written response, rejecting Trumka’s assertion that his department has been “missing in action.” He blamed the AFL-CIO leader for misleading employers about their duties.

That letter, which the DOL public affairs office promoted to the press, demonstrated the secretary’s commitment to defending the administration’s efforts from accusations of betraying workers, even as it reinforced dismay among critics about Scalia’s performance in the crisis. Scalia argued OSHA’s approach of periodically updating guidance for employers is a better way of responding to the contagion because scientific knowledge of Covid-19 continues to evolve.

“At almost every decision point he has opted against the position that would be the most protective and compassionate,” said Sharon Block, executive director of the Labor and Worklife Program at Harvard Law School and a senior DOL official under President Barack Obama.

In addition to playing a role in discussions over business liability, Scalia is also likely to have a prominent voice in talks over whether Congress should extend the extra $600 weekly jobless benefits supplement, which expires in July. By the time those talks take place, Scalia may already be a step closer to the president’s inner circle and taking part in more speaking events to deliver Trump’s message that the economy will recover.

Whether the pandemic “makes or breaks him or anyone else, we’ll figure that out later,” the Trucking Association’s Spear said of Scalia. “I think right now the focus is on solving the problem.”

—With assistance from Jaclyn Diaz.

To contact the reporter on this story: Ben Penn in Washington at bpenn@bloomberglaw.com

To contact the editors responsible for this story: Chris Opfer at copfer@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com

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