Looking in the Crystal Ball of HR Requirements

A number of Executive Orders (EO) signed by President Obama could be on the chopping block under the new administration. EO impact mostly employees for federal contractors. Other DOL regulations are likely to see changes too.

Here’s a review of the regulations which were born under the Obama administration and my assessment of their future.

Executive Orders likely to remain unchanged.

Based on its populist agenda and a push for better opportunities in favor of American workers, the Trump administration is likely to maintain:

  • Non-displacement of qualified workers under service contracts (EO 13495). This gives employees working on federal contracts the right of first refusal when another company takes over the contract in the process known as “re-badging.”
  • Minimum wage for federal contractors of $10.20 since Jan. 1, 2017 (EO 13658) although the annual increase might be slowed down in a nod to the business community.
  • Non-retaliation for disclosure of compensation information (EO 13665). This is the “pay transparency requirement”  introduced in 2015. It prohibits federal contractors from disciplining employees (or job applicants) who inquire, discuss, or disclose their compensation or that of others.

Regulations likely to be modified:

  • Fair pay and safe workplaces (EO 13672). This is one of the most controversial requirements imposed on large federal contractors. It was labeled the “black listing” rule by its critics. It requires federal contractors to report violations of 14 different labor laws to the federal government when bidding for federal contracts. A few days before it was supposed to come into force in October, a court in Texas put it on hold. This is the most likely EO to be repealed in short order.
  • The 2016 Overtime rules was put on hold by the same Texas Court put a before its implementation.  Even without a court decision, the new Administration can modify it with the support of the Republican-led Congress.  This is consistent with the President-elect’s frequent comments that the government must reduce business regulations to promote a free market.  Trump has also advocated for a small-business exemption to overtime requirements.

Uncertainty about the future those regulations:

  • Paid sick leave for federal contractors (EO 13706). Since January 2017, federal contractors are required to provide one hour of paid sick leave for every 30 hours employees work. Workers can accumulate up to 7 days of sick pay. However, business groups could take advantage of the return in power of the Republicans to lobby for its repeal in the name of free market.
  • EEO-1 Pay Equality: Trump promised to continue to support equal pay for men and women.  However, he also expressed hesitation in
    imposing additional government regulation. The requirement to collect pay data in the EEO-1 report is perceived by many employers has government overreach and anti-competitive when bidding on contracts.

Over the coming years, we will monitor how many of those EO get repealed or fall by the wayside through non-enforcement by the executive agencies. EO can be annulled with the stroke of the president’s pen so these changes could happen quickly.

Throughout his campaign, candidate Trump expressed support for a smaller federal government which could lead to a higher reliance on federal contractors may surge, especially if Congress passes the trillion dollar infrastructure spending bill.

 

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