How the Recent Election May Impact Employers

Now that the dust has settled from a long and contentious presidential campaign, HR professionals and employers have shifted their focus to how the results may affect their organizations. Typically, a Republican presidential administration results in more employer-friendly policies from federal agencies; however, in this instance, it remains unclear exactly how the Trump administration will handle labor and employment issues and what their priorities will be. We offer the following predictions and will continue to monitor these issues as they develop.

Wage and Hour Law

The Department of Labor’s expansion of overtime under the Fair Labor Standards Act is scheduled to go into effect on December 1, 2016, well before President-Elect Trump takes office. The DOL’s new regulations raise the salary threshold to qualify for the exemption from overtime pay to $47,476 per year.

It is estimated that the new regulations will result in about four million more employees qualifying for overtime pay. There are legal challenges which could delay their effect, including an expected ruling from a federal court in Texas on November 22, 2016 that could enjoin the changes. Also, President-elect Trump or the Congress could attempt to reverse the changes once he takes office; however, this would present difficult legal and political challenges. For the time being, employers should plan to deal with the changes to the exemptions and watch for the court ruling on November 22.

Separately, President-elect Trump provided a mixed message on whether he would support raising the national minimum wage. In some interviews, he stated he would support raising the minimum wage to $10 per hour, while in some speeches, he said that the minimum wage is a state issue.

The National Labor Relations Board

Typically, the election of a Republican presidential candidate spells management-friendly policies from the National Labor Relations Board. But because of the coalition that elected the new president, it is difficult to gauge how the new administration will handle traditional labor matters. In fact, the new administration may feel politically obligated to promote pro-labor policies because polling shows that union members were partially responsible for his victories in traditional rust belt states.

Practically, there are currently two vacant positions on the National Labor Relations Board, which the new president will be able to appoint after his inauguration. The urgency with which the new administration deals with these vacancies may provide a clue as to how labor law will be affected over the next four years. In any event, the National Labor Relations Board under President Trump will have opportunities to review some of the Board’s more controversial decisions, including the revised representation election rules, as well as case law concerning joint employer status, class action waivers in arbitration agreements and appropriate bargaining units.

Paid Leave

While the candidates differed on many issues, one place where they agreed was on a proposal to provide paid leave to employees. Specifically, President-elect Trump stated, "I think Hillary and I agree on that. We probably disagree a bit as to numbers and amounts and what we’re going to do, but perhaps we'll be talking about that later." Initial reports from the transition team reveal that the new administration will work on a proposal that will provide a form of paid leave to employees.

In summary, employers should expect changes in the enforcement and legal interpretations of labor and employment laws by federal agencies under the Trump administration, but much remains unclear regarding what President-elect Trump plans to do in the employment arena and how soon his administration will act on those issues.