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Transcript of D D Leading People. Leading Organizations. The 114 th Congress and the Second Term Obama...
D
Leading People. Leading Organizations.
The 114th Congress and the Second Term Obama Administration: What Does it Mean for HR Professionals?
Michael P. Aitken, Vice President, SHRM Government AffairsWashington Outlook
Washington State Human Resources CouncilJanuary 28, 2015
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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Environment
Mentions of Jobs as Top U.S. Problem at Six-Year Low
Source: Gallup, January 14, 2015
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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Environment
Americans Rate Nurses Highest U.S. Views on Honesty and Ethical Standards in Professions
Source: Gallup, December 8-11, 2014
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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Most States Had 30 to 50 Percent Voter Turnout in 2014
Source: Michael P. MacDonald, “State Turnout Rates, 2010-2014,” United States Election Project, November 17, 2014.
Analysis• 2014 saw low voter turnout across the board, with seven states (UT, OK, TX, TN, MS, IN, NY) dipping below 30% turnout• Most midterm elections see lower rates of participation than general elections• In 2014 the lowest turnout rate in an individual state was Indiana with 28.0%, and the highest was Maine with 59.3%
30% to 40%
50% to 60%
OH
WVVA
PA
NY
ME
NC
SC
GA
TN
KY
IN
MIWI
MN
IL
LATX
OK
ID
NV
OR
WA
CA
AZ
NM
CO
WY
MT ND
SD
IA
UT
FL
AR
MO
MS AL
NE
KS
VTNH
MA
RICT
NJ
DE
MD
DC
AK
HI
2012 Voter Turnout Rate for Midterm Elections(by Voting-Eligible Population)
20% to 30%
40% to 50%
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The Presidency
5
President Obama Job Approval
Source: Real Clear Politics, January 25, 2015
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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The Presidency
6
President Obama 2015 SOTU Pledges
Source: 2015 State of the Union Address, WhiteHouse.gov
Issue Area Pledge
Budget and Taxes• Work for tax reform which lowers taxes on working families and closes tax loopholes• Create a new tax cut of $3,000 per child per year to help reduce childcare costs• Work to simplify tax code on individuals and businesses• Increase top tax rates on capital gains and dividends
Climate/Energy • Will veto any bills which roll back environmental protections
Economy • Will veto any bills which attempt to further roll back Dodd-Frank• Help states adopt paid leave laws, and push for a federal bill providing seven days of paid leave• Push for gender-equal pay legislation• Push for an increased minimum wage
Education • Provide federal access to free community college• Work with Congress to help reduce monthly payment sizes of existing student loans• Extend internet access to every classroom
Health Care • Will veto any bills which remove access to health insurance• Launch Precision Medicine Initiative to advance disease cures and increase access to personalized medicine (similar to
House’s 21st Century Cures Initiative)
Immigration • Will veto any bills which roll back executive immigration actions
Infrastructure • Will push for bipartisan infrastructure plan in Congress• Expand internet access to all communities and assist development of faster networks
International Affairs
• Receive trade promotion authority from Congress• Push for closure of Guantanamo Bay• Urge Congress to pass an AUMF resolution against ISIL• Work for Iran nuclear deal (pledge to veto any additional sanctions bill)• Push for congressional action on cybersecurity legislation
Other • Protect net neutrality• Issue report on administration’s attempt to strengthen privacy protections in domestic surveillance programs
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Proposed Rules Can Be Blocked By Public, Congress, the Courts
Source: National Journal Research, 2014; Katie Weatherford, “Attempts to Use Congressional Review Act for Proposed Rules Threaten All Public Safeguards,” Center for Effective Government, March 11, 2014.
Analysis• The public comment period is the main obstacle to finalizing a rule; comments from knowledgeable insiders can significantly alter or eliminate the rule• Congress can pass a Resolution of Disapproval under the Congressional Review Act to stop a regulation, but the president must sign it in order for the regulation not
to take effect; only one resolution of disapproval has ever been signed to halt a regulation• Opponents of a regulation can halt a rule’s enactment by successfully challenging the rule in court or lobbying for laws to limit the powers of enforcing agencies
Agency Proposes Rule
Public Comments on Regulation
Rule is Finalized/Publishe
d In Federal Register
If the rule is challenged in
court, a judge can prevent
enforcement with an injunction and
may eventually strike down the
rule
Congress may pass new legislation
restricting agencies’ ability to
enforce the rule
Process and Obstacles for Enacting and Enforcing Federal Rules
Congress/President Can Review
Rule is Enacted
An agency may decide to scrap the proposed
regulation after reviewing comments from interested
parties and other government officials
Congress may pass a Resolution of Disapproval
prior to the rule’s enactment, which, if signed by the
President, will void the rule
President OrdersCreation of Rule
CongressRecommends
Rule
Agency NoticesProblem
!
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The Presidency
8
Race for 2016 is on… Republican Presidential Nomination
Source: Real Clear Politics, December 21, 2014
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The Presidency
9
Race for 2016 is on… Democratic Presidential Nomination
Source: Real Clear Politics, December 21, 2014
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Congress
U.S. Congress Starts Off Year with 16% Job Approval Congress’ Job Approval Ratings, Yearly Averages
Source: Gallup, January 13, 2015
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CongressEvery State Legislature Is More Productive Than CongressLegend
OH
WV VA
PA
NY
ME
NC
SC
GA
TN
KY
IN
MIWI
MN
IL
LATX
OK
ID
NV
OR
WA
CA
AZNM
CO
WY
MT ND
SD
IA
UT
FL
AR
MO
MS AL
NE
KS
VT
NHMA
RICT
NJDE
MD
AK
HI
Congress Enacted 3% of Bills Introduced
in the 113th Congress
Analysis• As measured by the percentage of bills introduced that were enacted as law, every state legislature was more productive than Congress in
2014• The least productive state legislature, Minnesota, enacted 5% of all introduced bills, which was still higher than Congress’ 3% rate• Although comparisons are difficult because not all bills are of equal importance, these percentages illustrate the relative ease with which
state legislatures pass laws compared to Congress• Whereas Congress has experienced years of gridlock and divided government, many state governments are unified under one party and have
simpler procedures for drafting and passing legislation
0-10%
10-25%
25-50%
>50%
Sources: National Journal Research; GovTrack.us; StateNet.com.
Percentage of Bills Enacted as Law in Most Recent Legislative Session
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Congress
Americans’ Priorities for the New Congress
Source: Gallup, November 5, 2014
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Source: National Journal Research; CNN Election Center; New York Times.
Republicans Win Record Majority in House
Analysis• Republicans won a total of at least 246 seats in the House, their largest majority since 1928• An expanded GOP majority in the House means that Speaker Boehner will have an easier time passing legislation
in the House without Democratic support, and Republicans will also have an easier time holding on to their majority in future elections
Control of the 113th House (2012-2014)
Democratic
Republican
Control of the 114th House (2014-2016)
AK
Total SeatsDemocrats: 188
Republicans: 247
188 247
AK
Total SeatsDemocrats: 201
Republicans: 234
201 234
Congress
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Congress
Racial Composition of the 114th Congress
Source: Washington Post, January 5, 2015
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Congress
Gender Composition of the 114th Congress
Source: Washington Post, January 5, 2015
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Source: National Journal Research; CNN Election Center; Associated Press; NBC News.
Republicans Win Solid Majority in Senate
Analysis• Having won most of this year’s competitive races, Republicans secured 54 Senate seats, flipping the Senate from blue to
red• A GOP win in Louisiana was announced on December 6, 2014• Since Republicans expanded their majority to 54 seats, they will have an easier time passing legislation in the Senate
because they will need fewer Democratic defections to overcome filibusters (which require a 60 vote supermajority)
Control of the 113th Senate (2012-2014)
Democratic
Republican
Independent
Control of the 114th Senate (2014-2016)
Total SeatsDemocrats: 44
Republicans: 54Independents: 2
44 54
Total SeatsDemocrats: 53
Republicans: 45Independents: 2
53 45
2 2
Congress
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Union supported legislation not even on the stove; but may see Republican approaches to:
Compensation Equity Workplace Flexibility Labor-Management
President Obama in SOTU promised an aggressive regulatory and executive approach:
Proposed 541 Overtime Regulation. EEOC Guidance on Pregnancy Discrimination. Executive Order on Compensation Data Collection for Federal Contractors. Executive Order on Non-Retaliation for Disclosure of Compensation Info. Executive Order on Sexual Orientation and Gender Identity. Executive Order on Fair Pay and Safe Workplaces. Presidential Memorandum on Paid Family Leave for Federal Employees.
2015 Public Policy Agenda – Labor and EmploymentLabor-Management/Civil Rights Issues
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2015 Public Policy Agenda – Labor and Employment
Full NLRB Board will mean increased activity:
“Revised” Ambush Election Rule / Specialty Health Care / D.R. Horton.
SHRM will an advocacy leadership role on many of these in the 114th Congress and in the executive branch:
FLSA Overtime Rules NLRB Ambush Regulations FAR Proposed Regulations Compensation Equity Workplace Flexibility
Labor-Management/Civil Rights Issues
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Working Families Flexibility Act (H.R. 465)
Labor-Management/Civil Rights Issues
Legislation reintroduced in the House by Representative Martha Roby (R-AL) that amends the Fair Labor Standards Act to allow private-sector employers to provide comp time, giving these employers the option of offering their hourly employees the choice of compensatory time off or pay for overtime hours worked.
The act requires an employee to have worked a minimum of 1,000 hours within the last 12 months to be eligible for comp time.
The legislation allows employees to accrue up to 160 hours of compensatory time a year and to “cash out” unused comp time within specified periods of time.
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Employers are permitted to offer a comp time program only if it is part of a collective bargaining agreement or the employer and employee voluntarily agree in writing to the program prior to the performance of work.
Employers are required to cash-out unused comp time at the higher of the regular rate at which time was earned or the final regular rate.
SHRM is leading the effort on the Working Families Flexibility Act.
Senate companion legislation is expected to introduced by Senator Mike Lee (R-UT) in the next few weeks.
Labor-Management/Civil Rights Issues
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National Labor Relations Board Final Rule to Amend Representation Election Procedures Final rule was reissued by the NLRB in the Federal Register on December 15
and is nearly identical to regulations proposed in 2011. The Rule is scheduled to go into effect on April 14, 2015.
The rule revises the process for union representation elections, expediting the period of time between the filing of NLRB election petition and the election itself. The regional director could set a pre-election hearing to begin seven days after a hearing notice is served and a post-election hearing 14 days after the tally of ballots.
Provides for the electronic filing and transmission of election petitions.
Employers will be required to turn over private employee information to the NLRB and the petitioning party, including employee telephone numbers and e-mail.
Labor-Management/Civil Rights Issues
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SHRM filed a lawsuit on January 5 challenging the legality of the rule. In particular, the lawsuit raises the following issues:
Shortened time frame between the filing of an NLRB representation case petition and election;
Failure to establish a record supporting new election rules; Detrimental changes to the Board election proceedings and; Changes to voter list rules infringe on employee privacy rights.
Some 96 SHRM state councils and chapters and over 4,600 individual members submitted their own comments to the NLRB during the comment period on the rule.
SHRM member Roger King of Jones Day testified before the NLRB on April 10 on these issues.
SHRM member Steve Browne also testified before the House Education and Workforce committee on the rule in March.
Labor-Management/Civil Rights Issues
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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Department of Labor Proposed Rule to Amend 541 Overtime Regulations President Obama sent a presidential memorandum to the Department of Labor
(DOL) on March 13, directing the Agency to “modernize” and “simplify” the Section 541 rules.
Under the FLSA 541 Regulations, an employee qualifies as exempt from overtime if he or she satisfies a “duties test” (under the Executive, Administrative, Professional, Computer and Outside Sales regulations) and the employee is paid on a “Salary Basis.”
Although we have not seen a proposal, we understand the changes may include doubling the “Salary Basis” amount from $455 dollars a week ($23,660 annually) to $910 dollars a week ($47,320 annually).
Labor-Management/Civil Rights Issues
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Proposal will also modify the “duties test” making changes to definitions and possibly changing key terms and elements, particularly in the “primary duty” area.
DOL held a series of listening events over the last several months, four specifically with SHRM and our members.
Proposed rule is anticipated to be released by DOL in the first quarter this year.
Labor-Management/Civil Rights Issues
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Department of LaborExecutive Order on Fair Pay and Safe Workplaces Act under the Federal Acquisition Regulations
Signed by the President on July 31, the Executive Order requires prospective federal contractors and their subcontractors (with contracts valued at more than $500,000) to disclose to the government, labor violations of 14 different federal and state labor laws and the equivalent state laws that occurred during the previous 3-year period of time.
Laws covered include the FLSA, OSHA, the NLRA, Davis Bacon, the Service Contract Act, 503 of the Rehabilitation Act, USERRA, FMLA, Title VII of the Civil Rights Act, the ADA, ADEA; among others.
Contractors must disclose whether any of the following has been rendered against them for:
Administrative merits determinations. Arbitral awards or decisions. Civil judgments.
Labor-Management/Civil Rights Issues
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Federal contractors would also be required to disclose to each individual employee their particular classification as an independent contractor or employee.
The order would also prohibit employers with federal contracts of at least $1 million from requiring employees from entering into pre-dispute arbitration agreements for disputes arising out of Title VII of the Civil Rights Act or from torts related to sexual assault or harassment.
The FAR Council and DOL are directed to issue regulations within 90 days. The Executive Order is effective immediately but applies to any contracts entered into on or after final regulations go into effect.
Labor-Management/Civil Rights Issues
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2015 Public Policy Agenda – Health Care Reform
Supreme Court will hear case on the constitutionality of health care credits for coverage purchased through public exchanges in King v. Burnell.
Successful PPACA repeal in 2015 unlikely but 114th Congress will pursue several changes:
Definition of Full Time Application of Excise Tax
Second PPACA enrollment period for exchanges is between November 15-February 15.
Congressional oversight and regulatory guidance continues.
Tax-deferred status of health care benefits could become a target in tax reform in the next congress.
Health Care Reform Issues
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Source: Department of Health and Human Services, 2014.
28
Health Care Reform Issues
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2015 Health Care Premium Rates Generally IncreasingAverage 2015 Health Care Premium Rate Increases by State
Sources: PricewaterhouseCoopers, “A preliminary look at 2015 individual market rate filings,” August 7, 2014.
Analysis• 27 of 29 of states with publicly available data look to have some degree of premium increase; of those, 11 will
see an increase of between four and eight percent• Two states, Rhode Island and Oregon, will have lower premium rates in 2015 than in 2014
99%
0.87%
0.06%
OH
WVVA
PA
NY
ME
NC
SC
GA
TN
KY
IN
MI
WI
MN
IL
LATX
OK
ID
NV
OR
WA
CA
NM
CO
WY
MT ND
SD
IA
UT
FL
AR
MO
MS AL
NE
KS
VT
NH
MARICT
NJ
DEMD
DC
HI
AK
-2.5%-0%
0%-4%
4%-8%
8%-12%
12%-16%
>16%AZ
Health Care Reform Issues
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Save American Workers Act (H.R. 30)
Legislation will be reintroduced introduced in the Senate by Senators Susan Collins (R-ME) and Joe Donnelly (D-IN) and in the House by Representatives Todd Young (R-IN) and Dan Lipinski (D-IL) to amend the Internal Revenue Code to:
Modify the definition of “full time” for the hours worked requirement for health care coverage under the Patient Protection and Affordable Care Act from 30 hours a week to 40 hours.
Clarify that the number of hours counted toward a "full-time equivalent" employee to be 174 hours per month as opposed to 120 hours per month under current law.
The House passed the bill on a bipartisan vote of 252 to 172 on January 8 and was referred to the Senate. SHRM supports the measure.
President Obama has threatened to veto the legislation. 30
Health Care Reform Issues
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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2015 Federal Budget Process
A “CRomnibus” was signed into law to fund most of the government through 2015 but it will only fund immigration-related programs for a few months in attempt to block President Obama’s Executive Order on Immigration.
Federal National Debt
Better than anticipated short term deficit in 2015 but current federal debt is $18 trillion dollars. Deficit projected to hit $1.1 trillion a year by 2025.
Debt ceiling expires in March 2015 and will need to be extended.
Tax Reform
Congressional leaders and White House have signaled that tax reform is an area of potential bipartisan work in the 114th Congress.
Significant changes to employer sponsored benefits are part of the tax reform discussion.
2015 Public Policy AgendaTax and Benefits Issues
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Tax Increase Prevention Act of 2014 (P.L. 113-295)
Signed into law by President Obama on December 19, the law retroactively extends several tax provisions through December 31, 2014. Theses include:
Employer-provided transit and vanpool benefits from $130 to $250; Employer wage credit for activated military reservists; Work Opportunity Tax Credit, which allows businesses to claim a tax credit equal to
40 percent of the first $6,000 of wages paid to new hires of one of eight targeted groups;
Employer wage credit for activated military reservists;
The law also allows sponsors of multi-employer pension plan to take an additional five years to amortize their funding shortfalls to these plans. Multi-employer plans that are deemed in “endangered status” (generally less than 80% funded) or “critical status” (generally less than 65% funded or the plan is expected to become insolvent within a certain period) are provided additional flexibility in meeting their funding obligations. These provisions both expire on December 31, 2015.
Tax and Benefits Issues
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Exclusions from Taxable Income Account for Most Tax Expenditures
Analysis • The top 10 most expensive tax expenditures will cost the federal government roughly $900B in FY 2013• Both Republicans and Democrats have recently considered eliminating or limiting these tax breaks as a way to
generate revenue
Exclusions from Taxable Income
FY 2013 Cost of Major Tax Breaks
Tax Deductions Preferential Rates on Capital Gains and Dividends
Tax Credits
Employer-sponsored
health insurance
$248B
Pension contributions and earnings
$137B
Capital gains on assets
Social Security and other benefits
State and local taxes$77B
Mortgage interest
$70B
Charitable contributions
$161B
$39B
$43B
$33B
Earned income tax credit
$61B
Child tax credit$57B
Total$461B
Total$186B
Total$118B
Total$161B
Tax and Benefits Issues
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President Obama signed an executive order on November 21 granting temporary, legal status for up to 5 million undocumented aliens.
Executive order will allow undocumented aliens to live and work in the United States under a deferred action program.
President Obama has threatened a veto over any attempt by Republican leaders in Congress to rollback the executive order.
The 114th Congress is unlikely to move forward on “comprehensive immigration” but could consider a series of focused immigration bills on border security, worksite enforcement and possibly, Green Card reform.
The SHRM/Council for Global Immigration partnership is part of the dialogue and advocacy effort.
Immigration Reform Issues
2015 Public Policy Agenda – Immigration Reform
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Immigration Executive Action Refocuses Deportation Efforts, Expands Work Authorization
Pillar of Reform Actions Taken
Keep families together and protect those who came to the U.S. as children
• Expands DACA (deportation relief for undocumented immigrants who entered the country prior to the age of 16) to those who are currently older than 30 and to those who entered the U.S. before Jan. 1, 2010
• Creates Deferred Action for Parents (DAP) for immigrants who entered the U.S. before January 1, 2010 and have at least one child who is a U.S. citizen or green card holder
• Grants, under DACA and DAP, work authorization and 3 years of deportation relief for successful applicants• Provides provisional waivers of unlawful presence to individuals who have resided in the U.S. for at least 180
days and are the children of U.S. citizens or the spouse or children of lawful permanent residents
Change deportation priorities to target severe offenders
• Reforms “Secure Communities” program (current Administration policy on immigration enforcement, requiring local authorities to send information of any individual arrested and fingerprinted to be sent to Homeland Security for potential deportation) to only focus on deporting serious criminals and repeat offenders
• Targets immigrants who have entered the U.S. or were already ordered to be deported in 2014
Modernize immigrant and nonimmigrant visa programs and applications
• Clarifies and investigates a number of rules regarding visa availability and national interest waivers• Authorizes parole, on a case-by-case basis, to eligible investors, researchers, and entrepreneurs, who would
otherwise be ineligible for a national interest waiver• Allows application fees to be paid by credit card
Key Provisions in President Obama’s November 2014 Executive Action on Immigration
Analysis• President Obama signed the executive order in response to outcry from members of the Democratic base and Latino communities
frustrated at a lack of progress on immigration after the 2012 election cycle• The executive action has faced limited criticism from a policy perspective, but backlash regarding potential executive overreach from
Republicans in Congress (particularly given the timing of the order immediately following major Democratic losses in the 2014 elections) looks to be setting up a fight in the 114th Congress to potentially repeal the action
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CFGI And SHRM will Continue to Educate and Advocate
RECRUIT AND RETAIN TALENT TOOLS TO HIRE A LEGAL WORKFORCE
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Our Greatest Asset – Our Members!
SHRM Advocacy Team: Shaping HR Public Policy
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Developed to ensure when policy decision-makers (legislators, regulators, etc.) develop workplace policy, the voice of HR is heard via a “local network”
Since elected officials are most responsive to their constituents, informs legislators of policy impacts upon employers in her / his district
SHRM members best understand / are best suited to communicate how public policy affects employees, employers & the HR profession as a whole
SHRM members are constituents with an interest in policy that will sway legislators and develop credible and influential relationships with elected officials
The SHRM A-Team
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There are two opportunities for engagement in the A-Team:
Advocacy Captain – As a current (or former) HR practitioner, you volunteer to serve as the HR advocacy point person in the congressional district in which you reside, as the official liaison to your member of Congress and staff. Working closely with SHRM’s Government Affairs Team, you agree to communicate regularly with your lawmaker’s office on key workplace issues of focus, and participate in A-Team trainings and events throughout the year.
HR Advocate – You agree to serve in a supporting role with your Captain and fellow A-Team members, participating in SHRM’s periodic informational webinars and in the face-to-face meeting(s) with your legislator, sharing any particular workplace issue expertise you might have on timely HR issues of legislative focus.
Both positions are eligible for recertification credit annually.
The SHRM A-Team
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A-Team Statistics: January 2015
7,625+ active members 391 Advocacy Captains designated
across the country in 50 states. 14 Captains in
Washington=Complete!
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THANK YOU! Current Washington State A-Team Advocacy Captains
First Name Last Name City Member of Congress – A-Team Captain
Theresa Chow Richland Rep. Dan Newhouse (REP-WA-04)
Shellene Cook Bonney Lake Rep. Dave Reichert (REP-WA-8)
Gary Danberg Bellevue Sen. Patty Murray (DEM-WA)
Jennifer Dawson-Miller Tacoma Rep. Denny Heck (DEM-WA-10)
Karin Edenholm Seattle Rep. Jim McDermott (DEM-WA-7)
Eileen Griffin Richland Rep. Dan Newhouse (REP-WA-04)
Mary Ludden Snohomish Sen. Maria Cantwell (DEM-WA)
Patrice McSherry Mercer Island Rep. Adam Smith (DEM-WA-9)
Amy Robinson Vancouver Rep. Jaime Herrera Beutler (REP-WA-3)
Abbi Rudolph Montesano Rep. Derek Kilmer (DEM-WA-6)
MaryAnn Sailors Bothell Rep. Rick Larsen (DEM-WA-2)
Nancy Slotnick Tacoma Rep. Denny Heck (DEM-WA-10)
Diane Toomey Redmond Rep. Suzan DelBene (DEM-WA-1)
Caroline Wyatt Liberty Lake Rep. Cathy McMorris Rodgers (REP-WA-5)
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SHRM 2015 EMPLOYMENT LAW & LEGISLATIVE CONFERENCE
Hear from thought-provoking, informed keynote speakers who will help change your outlook, open your mind to new ideas and advance your career.
KEYNOTE SPEAKERS
CHUCK TODDHost of “Meet the Press” and NBC News Political Director
SALLIE KRAWCHECKOne of the Most Respected Voices on Wall Street and Owner of Ellevate
DAN ABRAMSLegal Analyst for ABC News; CEO, Abrams Research;And Founder/Publisher, Mediate.com
MIKE AITKENSHRM's Vice President of Government Affairs
REGISTRATION BEFORE JANUARY 16, 2015 FOR THE EARLIEST RATES!conferences.shrm.org/legislative
HR PUBLIC POLICY / WASHINGTON OUTLOOK
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Michael P. AitkenVice President, Government Affairs
+1-703-535-6027
1800 Duke StreetAlexandria, VA 22314Twitter: @SHRMVPAitken