Government Affairs Update

Government Affairs Update International Training Forum Neil Reichenberg IPMA-HR EXECUTIVE DIRECTOR ipma-hr.org

Outline • Overview • Budget/Economy • Overtime • EEO-4 • Paycheck Fairness Act • Healthcare Reform • FLSA Case Brief • Administrative Procedure Act Case Brief • Emergency Unemployment Comp. • Minimum Wage • Workforce Innovation & Opportunity Act • FMLA Proposed Rule on Same-Sex Marriage • Executive Orders on Sexual Orientation • Pregnancy Discrimination Guidelines • 1st Amendment Case

Mood of the Country • “Americans are unhappy” • More than 70% believe the country is headed in the wrong direction • Almost 60% are angry enough to carry protest signs • 49% believe the economy is still in a recession • 79% are dissatisfied with the political system • 71% believe the economic problems are due to the inability of elected officials to get things done to improve the economy • President Obama’s overall job ratings are in the 40’s and only 14% approve of the job Congress is doing

Overview • Congress returned from its summer vacation and has already adjourned until after the election • Continuing resolution funding the government through December 11th has been passed • Focus of the House is on oversight/investigations/suing President Obama • For the first time in 25 years of polling, over half (51%) say they disapprove of the job that their member of Congress is doing

Overview • The election will result in continued control of the House of Representatives by the Republicans • Uncertainty as to who will control the Senate • Congress will return following the election, although its agenda is uncertain

Budget Issues • There was a 16 day partial shutdown of the government last year • It was estimated that the shutdown took at least $24 billion out of the US economy with federal employees missing 6.6 million days of work • Debt ceiling suspension through March 15, 2015 signed by the President

Economy • In August, 142,000 jobs were added and the unemployment rate was 6.1% • 54 consecutive months of job growth • Labor underutilization rate in August was 12% • Government added 8,000 jobs (local +4,000/state + 1,000/federal +1,000) • Since the beginning of the year, government has added 88,000 jobs while the overall economy has added 1,440,000 jobs • Since mid-2009, when the recession officially ended, government has lost over 650,000 jobs

Overtime Regulations • President has directed the Secretary of Labor to revise the FLSA overtime regulations for executive, administrative, and professional employees • To be considered exempt, employees must be paid at least $455/week – this amount is expected to be increased • The duties tests for each of the exemptions are likely to be revised • Labor Department indicated that the proposed regulations may be released in November • IPMA-HR will be involved in the revisions

Overtime Legislation • Senator Harkin (D-IA) & 8 Senate Democrats have introduced the Restoring Overtime Pay for Working Americans Act (S 2486) • The overtime salary threshold would be increased over three years to $1,090/week and indexed for inflation • The threshold for highly-compensated employees would be increased over three years from $100,000 to $125,000/year & indexed

EEO-4 • On July 29th, the EEOC approved a modification to the EEO-4 reporting form to allow respondents to select more than one race/ethnicity similar to the EEO-1 for the private sector • A request for public comment has been published with a due date of October 28th • The EEOC advised that the revisions will be effective for the 2015 reporting cycle • IPMA-HR has written to the EEOC urging this modification

Paycheck Fairness Act • The Paycheck Fairness Act (S. 2199) was reconsidered by the Senate and a vote on cloture (a vote to end debate) did not receive the required 60 votes • This is the 2nd time the vote has been taken this year • IPMA-HR joined with 23 other national associations on a letter expressing opposition to S. 2199 • Paycheck Fairness Act allows for unlimited punitive and compensatory damages for employers found to be liable of sex-based wage discrimination

Healthcare Reform • Over 8 million people have signed up for insurance through the health exchanges • Recent polling shows that 56% of Americans have an unfavorable opinion of the Affordable Care Act (ACA) • Conflicting rulings have been issued by appellate courts as to whether the ACA allows subsidies to those who sign up through the federal exchange • DC Circuit ruled that subsidies can’t flow through the federal exchange – full court will review the decision • 4th Circuit found that subsidies were permissible – appeal has been filed with the US Supreme Court

Healthcare Reform • IPMA-HR supports the “Forty Hours is Full-Time Act,” which passed the House of Representatives • The bill would increase the threshold for ACA coverage to 40 hours per week or 174 hours per month • Employers have been cutting their employees hours to less than 30 hours/ to avoid week to avoid having to provide health insurance

FLSA Case Brief • IPMA-HR joined with several other state and local government associations in filing an amicus brief in an FLSA case (Integrity Staffing Solutions v. Busk) pending before the US Supreme Court • Issue is whether security screenings at the end of each shift that occur after clocking out are compensable • Only those activities that are both “integral and indispensable” to principal work activities are compensable

Administrative Procedure Act Amicus Brief • IPMA-HR will join other state/local government associations in filing an amicus brief in a Supreme Court case (Perez v. Mortgage Bankers Association) • The case raises the issue of whether a federal agency must engage in notice-and-comment rulemaking before it can significantly alter an interpretive rule of an agency regulation • DOL issued an opinion letter saying mortgage loan officers were exempt employees – 4 years later, DOL withdrew the opinion letter in an Administrator’s Interpretation that reached the opposite conclusion • Case was brought on behalf of employers who believed that DOL should be required to issue notice and allow public comment before changing an interpretation relied on by employers • The brief will argue that notice and comment is legally required when significant changes are contemplated

Emergency Unemployment Compensation • Emergency unemployment compensation program ended on December 28th • Senate passed a 5 month extension retroactive to December 28th – Bill not considered by the House • Senators Reed/Heller introduced a new bill (S 2532) to extend unemployment insurance benefits prospectively • Bill would be fully paid for and would allow those who were cutoff on 12/28 to pick up where they left off • An estimated 2.4 million people have lost their long-term unemployment benefits • Congress is not likely to extend the program

Minimum Wage • Legislation has been introduced that would increase the federal minimum wage to $10.10 per hour by 2015 • Current minimum wage is $7.25 per hour • Polls show widespread support for increasing the minimum wage • Senate bill failed to get the 60 votes needed to be considered • 11 states and several local governments have increased their minimum wages • President raised the minimum wage to $10.10 for federal contractors

Workforce Innovation and Opportunity Act • The President has signed the Workforce Innovation and Opportunity Act which is designed to streamline & modernize the federal job training programs • Key provisions: • Ensuring accessible one-stop centers & training providers • Enhancing the flexibility of funds • Setting common performance indicators for all core programs • Eliminating 15 ineffective programs • Better alignment of disability programs

FMLA Proposed Rule • The Labor Department issued a proposed rule extending the protections of the Family and Medical Leave Act to all eligible employees in legal same-sex marriages regardless of where they live • Under the proposed rule, eligibility for FMLA protections would be based on the law of the place where the marriage was entered into, allowing all legally married couples, whether opposite-sex or same-sex, to have consistent federal family leave rights regardless whether the state in which they currently reside recognizes such marriages

Sexual Orientation Executive Orders • President Obama signed executive orders prohibiting companies receiving federal contracts from discriminating based on sexual orientation or gender identity and prohibiting the federal government from employment discrimination based on sexual orientation and gender identity

Pregnancy Discrimination Guidelines • EEOC issued guidance on pregnancy discrimination - http://www.eeoc.gov/laws/guidance/pregnancy_guidance.cfm • Employers are required to offer light-duty work to pregnant employees if they make light duty available to non-pregnant employees who are similar in their ability or inability to work • US Supreme Court will review a case (Young v. UPS) in which the 4th Circuit ruled that UPS was not required to offer light duty to pregnant employees with work restrictions, even if light duty is available for certain categories of non-pregnant employees

First Amendment Case • The US Supreme Court ruled in the case of Lane v. Franks that the 1st Amendment protects a public employee who provides truthful sworn testimony outside the scope of his ordinary job responsibilities • The court limited the scope of the decision to those employees whose ordinary job duties did not include testifying in court proceedings • A concurring opinion noted the court did not address the different question whether a public employee speaks as a citizen when he testifies in the course of his ordinary job responsibilities • IPMA-HR filed a brief in support of the employer

Contact: Neil Reichenberg nreichenberg@ipma-hr.org or call (703) 549-7100 Questions?

Government Affairs Update