Q: Wednesday night, President Obama gave his last State of the Union Address. Did he provide any insight into potential new laws that will affect employers?
A: The State of the Union is always great political theatre. I particularly enjoy when one side of the chamber stands and claps while the other side sits and shakes their heads. This got me thinking, what if the chamber was full of just employers instead of politicians? Would, or should, those employers have stood up and clapped or stayed seated and shook their heads?
The stand-up and clap moments – the President stated that he “believe[s] a thriving private sector is the lifeblood of our economy, . . .[and he] think[s] there are outdated regulations that need to be changed, and there’s red tape that needs to be cut.” Well said,…..Hooray! But, like every great infomercial (er….State of Union Address)….there is more.
The sit and shake heads moments –the President then seemed to suggest more red tape would be added. To that end, he wanted to “give everyone a fair shot at opportunity and security in this new economy.” This sounds great, but the “new economy” generally is a euphemism for what is commonly referred to as the “sharing economy.” As you may be aware, Uber has been the poster company for the “new/sharing economy” and is currently under attack for its designation of drivers as independent contractors instead of “employees.” As such, the President’s reference to a “fair shot and security” is likely a reference at continuing to limit the ability to classify individuals as independent contractors thereby ensuring more individuals fall under the rubric of labor laws, including overtime. This would seem to make sense, because it would be consistent with his past administration initiatives.
Additionally, the President noted the “attacks on collective bargaining” cannot go unanswered without hurting working families. This is seemingly in reference to both strengthening the National Labor Relations Board (NLRB) and a potential disproval of a current Supreme Court case, Friedrichs v. California Teachers Association et al., in which oral arguments were heard on Monday regarding compulsory union dues. Generally, strengthening “collective bargaining” is not interpreted as pro-employer (i.e. locally – the Gerawen Farming case).
Another sit and shake your head moment came when the President made reference and commitment to such legislative aims as paid leave and raising the minimum wage. In this regard, perhaps the President is simply jealous of California. As you are aware, California recently enacted a new law in 2015 that gives all employees up to 3 days or 24 hours of paid sick leave and minimum wage just went up from $9.00 to $10.00 on January 1, 2016.
Finally, as we have learned, President Obama is not afraid to use his executive order power to further his agenda. So, it would not a be a surprise to see additional actions, like his proposal to increase the salary minimum for exempt employees to $50,440.00.
As we have seen in the past decade, we predict 2016 will have no shortage of employment laws to make employers sit, shake their heads, and in some instances, want to curl up in the fetal position and cry. Nonetheless, as our economy improves we hope 2016 is your best employment year yet, and you have many reasons to stand-up and clap.