The Trump Administration and the 115th Congress: The Washington Outlook for HR Public Policy
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1 The Trump Administration and the 115th Congress: The Washington Outlook for HR Public Policy Patrick J Brady Senior Advisor, Government Relations HR Florida State Council January 24, 2018
2 #SHRM 2
3 Current Washington Environment Key HR Issues What We Will Cover Tax and Benefits Labor Management / Civil Rights Health Care Reform Immigration Reform SHRM A-Team Update 3
4 The Presidency 4
5 Republicans control the House in the 115 th Congress with 239 Republicans to 193 Democrats. * Why control of the House is important: Oversight hearings; All tax legislation must originate in the House; Party in control of House tightly controls policy and; Need 2/3 of House to override a presidential veto. 5
6 Republicans control the Senate in the 115 th Congress with 51 Republicans to 47 Democrats, and 2 Independents. Why control of the Senate is important: Oversight hearings; Confirms presidential appointments and judges with simple majority; Approves treaties and; Magic number for control in the Senate is 60, not 51. Need 60 votes to ensure agenda moves forward. 6
7 Congressional Job Approval 7
8 U.S. House of Representatives Congress Since 1862 the President s Party has lost ground in the House in 36 of 39 midterm elections 8
9 The president s party has lost Senate seats in 19 of 26 midterms; their only gains occurred during the president s first term 9
10 2018 Mid-Term Elections Congress 10
11 Direction of Country 11
12 12
13 13
14 The Presidency President Trump America First running headlong into domestic and international realities, priorities and responsibilities: North Korea Russia Syria Pakistan Governing in the majority is proving to be difficult: Complicated stuff Freedom Caucus vs. Main Street Republicans Slimmer majority in the Senate now Hyper-partisan environment in Washington Divided America Ended year with legislative win on tax reform but starting new year with many must do s : Fund the government before February 8 deadline DACA fix Debt limit increase 14
15 President Donald Trump signed tax reform legislation, Public Law No: , on December 22, Wins for HR include: 2017 Tax Reform Preservation of Employer-Provided Education Assistance (IRC Section 127) Preservation of Qualified Tuition Reduction Programs (IRC Section 117) Preservation of Dependent Care Flexible Spending Accounts (IRC Section 129) Preservation of Adoption Benefits Preservation of the Work Opportunity Tax Credit Preservation of Medical Savings Accounts (MSAs) Preservation of Catch-Up Provisions for High Earners 15
16 Tax Reform Changes Impacting HR: (effective December 31, 2017) Commuting (Transit) Benefits No longer a deductible business expense for employers. Employees may continue to exclude the benefit from taxable income. (2018 limit $260/month) Biking Benefit No longer a deductible business expense for employers. Benefit now included in taxable income for the employee. (2018 limit $20/month) Moving Expenses No longer a deductible business expense for employers. Employees cannot deduct moving expenses and any stipend provided by employers will be included as taxable income. Other Fringe Benefits Other benefits such as employer-provided meals and onsite gyms are no longer a deductible business expense for employers. Employees may continue to exclude the benefit from taxable income. Employee Achievement Awards - No longer a deductible business expense for employers. Benefit now included in taxable income for the employees. This includes cash, cash equivalents, gift cards, gift certificates, vacations, meals, lodging or tickets to theater or sporting events. Family and Medical Leave Act (FMLA) Credit for Employers - Provides an employer a credit of percent of the wages paid to a qualified employee utilizing FMLA. 16
17 2018 Policy Priorities: Expansion of Employer-Provided Education Assistance Benefits (Section 127) Employer Participation in Student Loan Assistance Act (HR 795) Bipartisan legislation introduced by Representatives Rodney Davis (R-IL), Jared Polis (D-CO), Scott Peters (D-CA) and Elise Stefanik (R-NY). Expands Section 127 of the Internal Revenue Code to include student loan repayment. Expansion of Section 127 Limit (S.2007/H.R. 4135) Bipartisan bill introduced in Oct. by Senators Jeff Flake (R- AZ) and Catherine Cortez-Masto (D-NV) and Reps. Jason Smith (R-MO), Rodney Davis (R-IL), Henry Cuellar (D-TX) & Danny Davis (D-IL). Will expand Section 127 of the IRC to $11,500 per calendar year, and index that amount for inflation. As Chair of Coalition to Preserve Employer-Provided Educational Assistance, SHRM supports both of these bills. 17
18 Public Policy Agenda Labor and Employment President Trump created a new 2 for 1 Rule: Creates a Regulatory Reform Office in each agency Focus on regulations that eliminate/inhibit jobs, outdated or costs exceed benefits Aggressive regulatory and executive action on Obama-era rules: Final Persuader Rule Rescinded Administrative Interpretations on Joint Employment and Independent Contractor Rescinded NLRB Board remains a 2-2 tie of Democrats and Republicans. Recent Board action will be reviewed: Marvin Kaplan, confirmed, named Chair William Emanual, confirmed Board Chair Phillip Miscimarra retired in December December flurry of activity = cases overturned on joint employment, micro-unions, and neutral handbooks should receive more latitude RFI on 2015 ambush election rule due 2/28/18 18
19 July 26, 2017 DOL issued 60-day comment period on RFI on overtime rule Public Policy Agenda Labor and Employment August 31, 2017 Texas Court struck down final Obama Administration overtime rule. October 2018, target date for NPRM on overtime rule. Janet Dhillon (Chair) and Daniel Gade nominated to EEOC Commission and still pending confirmation. Once confirmed, EEOC will review: Final Guidance on Sex Discrimination Final Wellness Rules under ADA and GINA by Aug EEOC Best Practices on Harassment and draft guidance Stayed EE0-1 Compensation Data Collection Rule will be reviewed 19
20 Obstacles to Agency Action 20
21 21
22 State and local paid sick leave laws, by administrative district Requirements vary by jurisdiction 22
23 Bills to mandate paid leave introduced in Congress, but action unlikely: Public Policy Agenda Labor and Employment Healthy Families Act (S.636 & H.R. 1516) Requires employers with 15 or more employees to provide up to 56 hours of paid sick leave. FAMILY Act (S.397 & H.R.947) Creates a paid family leave insurance fund through a payroll tax to provide partial wage replacement for FMLA qualifying events. 23
24 Tomorrow s Workplace Doesn t Work By Today s Rules 24
25 Rep. Mimi Walters (R-CA) H.R. 4219, Workflex in the 21st Century Act of 2017 Labor and Employment Representative Mimi Walters introduced SHRM-developed legislation that would expand paid leave and workplace flexibility opportunities for all employees: Employers that choose to participate by offering a minimum threshold of paid leave and a flexible work option to all employees will benefit from pre-emption of all state and local paid sick leave law requirements. Amends ERISA, giving employers flexibility and predictability through a federal framework to design workplace flexibility offerings, rather than a patchwork of conflicting government mandates. 25
26 Amends ERISA by adding to the definition of an ERISA plan a Qualified Flexible Work Arrangement Plan (QFWA) that must include 2 components for all employees: compensable leave and a workflex option. Compensable leave defined as paid time off, sick leave, personal leave, or vacation. Number of compensable days available to employee determined by employer size and employee tenure. Compensable leave is available to full-and part-time employees with leave prorated for part-time employees based on a calculation subject to the employer s full-time designation. Employees will begin to accrue leave upon employment but may be prohibited from using the leave in their first 90 days of employment. 26
27 27
28 A Flexible Work Arrangement (FWA) must be offered to each eligible employee (individuals employed for 12 months and that have worked 1,000 hours during the previous 12-month period) and may include: Compressed work schedule; Biweekly work program; Telecommuting program; Job-sharing program; Flexible scheduling; or Predictable scheduling Employers may specify which employee positions can participate in a particular FWA and employee participation is voluntary. Participation of union employees will be determined by the collective bargaining process. Federal contractors that offer this ERISA workflex plan would satisfy the executive order on paid sick leave. 28
29 29
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32 Health Care Reform Issues Rate of health care coverage of U.S. population, % 20.0% 40.0% 60.0% The Vast Majority of Americans have Employment-based Coverage Employment-based Direct purchase Medicaid 16.3% 19.6% 55.7% Medicare 16.3% Military health care Uninsured 4.7% 9.1% Source: Health Insurance Coverage in the United States: 2015, US. Census Bureau, September
33 Health Care Reform Issues Repeal of the Affordable Care Act (ACA) was one of President Trump s major priorities in the first 100 days of his Administration. but reform has proved difficult Public Policy Agenda Health Care Reform Congress tried to use budget reconciliation framework to provide expedited repeal of the tax provisions of the ACA, but failed. Targeted and incremental changes to the ACA is ongoing. For example, the new tax law reduces the individual mandate penalty to 0 beginning in However, the mandate is still applicable for 2017 and House Ways and Means will consider a package to delay some ACA taxes in the first quarter of That package will likely include 33
34 These taxes are currently scheduled to take effect in 2018 and
35 Public Policy Agenda Immigration Reform 35
36 36
37 SHRM on speed-dial with policy makers: Testified 7 times in front of congressional committees Testified 3 times before federal agencies Testified 5 times at the state level Invited to 3 congressional roundtables Invited to 8 federal agency roundtables SHRM Advocacy in Action Leslie Christ, SHRM-CP, (pictured on the far left), Crystal Frey, SHRM-SCP, (seated next to Leslie) testifying at House Subcommittee on Workforce Protections on comp time Frank Cania, SHRM-SCP, serving as a witness before the House Committee on Small Business on regulatory reform Nancy McKeague, SHRM-SCP, testified before the House Subcommittee on Health, Education Labor and Pensions on FLSA reforms 37
38 SHRM Advocacy in Action SHRM A-Team Statistics 9,800+ active members Advocacy Captains designated across the country in 50 states.. 38
39 Get Involved: 39
40 Contact Me >>> Patrick Brady Senior Advisor, Government 1800 Duke Street Alexandria, VA
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