The First 100 Days of the Biden Administration: Labor and Employment Activity

By Brianne Dunn, William Pokorny, Michael Warner and Tracey Truesdale - Franczek, P.C.

March 5, 2021

Each Friday during the first 100 days of the new administration, we will provide a recap of significant initiatives and events that will impact employers.

In week seven, the Biden administration’s labor and employment activity includes the termination of the EEOC General Counsel, a first look at job activity under the new administration’s first full month in office, a Department of Labor delay to the Trump era independent contractor rule, and the latest efforts getting the COVID-19 stimulus bill across the finish line.

Biden Fires EEOC General Counsel After She Refuses to Resign

Sharon Fast Gustafson, the Equal Employment Opportunity Commission General Counsel, was fired today by President Biden after she refused to resign. Gustafson was appointed by President Trump in 2018 and was the first woman to serve as EEOC General Counsel. Her term was slated to last through 2023. In her letter to the white house, she speculated whether her work pursuing religious discrimination cases played a role in her exit.

What’s to Come: The Biden administration’s move to fire Gustafson follows a similar trend from its recent firing of Peter Rob, the NLRB General Counsel who also refused to resign. Both Robb and Gustafson question the motives and precedent of their removals especially given the time left in their terms respectively. As with the firing of Robb, the termination is a clear indication of the administration’s urgent shift to left-leaning employee-friendly policies and interpretation.

White House Jobs Report Shows Women of Color Disproportionately Leaving Labor Force

The White House published its February jobs report indicating a slight acceleration in job growth in February. The report notes that despite this growth the economy remains down 9.5 million jobs from February 2020 and will require more than two years of job growth at February’s pace just to get back to pre-pandemic levels. Equally troubling is the disproportionality in the unemployment rate for individuals of color and especially women of color. Black women were only 14 percent of the female labor force in February 2020, but have accounted for a disproportionate 26 percent of female labor force dropouts since then. Hispanic women were only 17 percent of the female labor force in February 2020 but have accounted for 27 percent of the female labor force dropouts.

DOL Delays the Start Date to Recent Trump Independent Contractor Rule

The Department of Labor is pushing back the effective date of a recent independent contractor classification test finalized during President Trump’s final weeks in office. The effective date has been delayed from March 8 to May 7 and has since drawn much commentary. The multifactor test is used to determine whether workers are classified as independent contractors. In cases where a worker in considered an independent contractor, the business the individual provides work to does not have to pay the worker minimum wage or overtime as required by the Fair Labor Standards Act for non-exempt employees.

What’s to come: While the DOL has stated the delay will not be disruptive because the rule has yet to take effect, the agency has received over 1,500 comments in response to the delay. Frustrated employers have commented that many have taken preparations in anticipation of the previous effective March 8 date. Additional opposition has come from small business owners and independent contractors who expressed a desire to be able to continue to choose to be independent contractors. As previously reported, the DOL withdrew a number of wage/hour opinion letters on independent contractor issues in January, and this latest move by the DOL signals that the Trump independent contractor rule is likely to be abandoned in favor of the more rigorous pro-employee standard under the Obama administration.

The COVID-19 Stimulus Bill Makes Its Way Through Congress

Debate over the COVID-19 stimulus bill began in the Senate on Thursday and is likely to be approved by the Senate along strict party lines. The bill passed in the House last week without a single Republican vote. The version of the bill that is likely to be approved in the Senate does not include the $15 minimum wage increase, due to opposition by moderate Democratic senators and a ruling by the Senate Parliamentarian that the minimum wage increase does not have a sufficient impact on the federal budget to allow it to be approved by a straight majority vote through the budget reconciliation process.

What’s to Come: If the bill continues to pass through Congress with only Democratic support, it will be the first of the COVID relief plans approved without bi-partisan support. The partisan divide over the relief package foreshadows further heightened divisiveness of Congress. Indeed, some red states have already begun to rebel against the administration’s COVID-19 guidance and related policies by ending mask mandates and social distancing requirements. At the same time, the White House has stepped up the vaccine rollout and is promising that vaccine supply will meet demand by the end of May.