Policy Matters Newsletter - June 22, 2021

President Biden Is Back From Overseas, And His Budget is Out. The White House has released the President’s 2022 budget proposal, which incorporates some of the legislative proposals made by President Biden over the past few months, including the American Jobs Plan (infrastructure), the American Families Plan, and various other investments, paid for by increasing taxes on corporations and on capital gains. Democrats are starkly divided on whether to pursue a “two-track” solution, by which they would pass a bipartisan infrastructure bill and then pursue a more progressive spending plan that would be passed along party lines. The alternative to that strategy would be to craft one massive spending bill, but not all Democrats in the Senate are willing to push a spending bill through along party lines. The current bill with the greatest chance of success is a roughly $1 Trillion infrastructure proposal (with about $400 billion repurposed from State COVID appropriations) supported by West Virginia Senator Joe Manchin and other centrists. That proposal currently has support from 21 Republican senators, though the public details of the proposal are still minimal.

California Heat Is Apparently Killing COVID; But That’s Not All That Is Dying Out West. The heat wave that recently rolled through Sacramento, California, was one of the worst on record. Despite the heat, legislators still met in the City of Trees to pass a number of bills in advance of the house of origin deadline. However, many of the most concerning labor and employment measures -- many introduced at the apex of the pandemic and aimed at mitigating the damage from the same -- failed to pass the house of origin deadline. As California is often the bellwether for labor and employment policy, we here at PMN think it is a worthwhile exercise to keep tabs on what is being enacted in California, as well as what measures the legislature is considering. In that vein, Seyfarth put together a helpful summary of those measures, here.

Whither Federal Legalization Of Cannabis?  When then-U.S. Attorney for the Eastern District of California Benjamin Wagner came to McGeorge School of Law in Sacramento discuss marijuana legalization, his symposium was short and true: Consumption and possession of marijuana remains illegal. A decade later, this remains the case, even as more states legalize cannabis, either for adult-use or for medical purposes. This leaves companies in those states dependent each year on an amendment to DOJ funding to ensure they won’t be shut down. They also can’t access the banking system, or take advantage of federal tax breaks. The gulf between the feds and the states is growing, as Connecticut, Rhode Island and Delaware could legalize adult-use cannabis in the near future. Groups in Arkansas, Idaho, Missouri, Nebraska and North Dakota are working to put legalization measures on the 2022 ballot. Add to that, public opinion has turned in favor of legalization -- in a recent Pew Research Center poll, 91% of those surveyed said marijuana should be legal either for adult-use or medical purposes.

Like most federal policy questions today, Marijuana remains stuck on Schedule I of the Controlled Substances List because of the 50-50 Senate split. Most Democrats favor legalization; in the House, Rep. Jerry Nadler (D-NJ) recently introduced a new version of the MORE Act (a marijuana reform bill) with several Democratic co-sponsors. But not all Democrats are on board -- Senators Jeanne Shaheen (D-NH) and Jon Tester (D-MT) are openly opposed to legalization.  Which leaves proponents looking at the other side of the aisle for support. And congressional votes from the GOP will be hard to come by, even from those representing states where some form of cannabis is legal. Indeed, some Senators representing states where marijuana is legal have expressly come out against legalization. So full legalization still seems a long way off.  To keep up to speed on what’s happening in the world of legalized marijuana, see Seyfarth’s The Blunt Truth blog, which offers substantive posts on industry developments and a weekly round-up.

More Mask Requirements Lifted.  Many states across the country are lifting their mask requirements as they meet vaccination targets. For example, as Seyfarth has reported, New York recently discontinued its mandatory industry specific COVID-19 guidelines, which included a mask requirement, upon reaching its goal of vaccinating 70% of all adults. Most states have modified their mask orders to resemble the latest guidance from the Centers for Disease Control and Prevention, which allows people who are fully vaccinated to remove masks, whether inside or outdoors. A small handful of states still maintain mask requirements for those who are not yet vaccinated in most indoor public settings. Look for states to continue to rescind mask requirements as the number of fully vaccinated adults increases.

Age Discrimination In Employment Bill To Get A Hearing In The House. House Majority Leader Steny Hoyer (D-Md) has informed colleagues that H.R. 2062, the Protecting Older Workers Against Discrimination Act, is coming up for action in the House this week. This bill would, at least partially, reverse a Supreme Court ruling in Gross v. FBL Financial Services, Inc. that imposed a higher burden of proof on employees alleging age discrimination under the Age Discrimination in Employment Act (ADEA). The bill would import the so-called mixed-motive standard to age-discrimination claims, permitting a Plaintiff to maintain an Age Discrimination suit by demonstrating that age was a motivating factor for an adverse practice, even though other factors also motivated the practice, i.e., the complaining party’s age was the sole cause of the employment practice. Under the Gross holding, employees were required to show that age was the sole cause for their termination, demotion, or other adverse employment action, rather than just a “motivating factor.” Perhaps most importantly, though, this bill would import this softer evidentiary standard to other employment discrimination and retaliation claims, including claims under the Civil Rights Act of 1964, the Americans With Disabilities Act of 1990, and the Rehabilitation Act of 1973. Unlike some of the more party-line measures to pass the House, this bill does have 14 republican co-sponsors -- but bipartisanship in the house does not always translate to the Senatorial logjam, so we remain doubtful this will pass. Stay tuned.

We Were Prepared for a Tempest, But The ETS Was Just A Zephyr. Since the onset of the Biden presidency, we here at the PMN have been writing on, and podcasting on, a potential emergency temporary standard (ETS) through all the ups and downs, as well as the policy upsides and downsides. Last week, OSHA finally released the much awaited ETS, but it is relegated only --- and appropriately -- to the healthcare industry. The Federal Register published OSHA’s health care COVID-19 ETS on June 21, 2021, making this the effective date, and compliance dates are keyed off of the effective date. For an excellent summary of the measure, see Seyfarth’s piece here.

If You Think The Federal ETS Was a Roller Coaster, California Would Like You To Hold Its Drink. We here at PMN began following Cal/OSHA’s stringent ETS, and the saga surrounding its passage, back in December, 2020. As spring sprung and COVID numbers began to fall in the golden state -- and, really, the CDC pushed the issue with its May 13 mask guidance -- Cal/OSHA began considering issuing a new ETS, lowering its standards. Last Thursday, after numerous, marathon meetings that each lasted at least four hours -- and were chalk full of entertaining commentary -- Cal/OSHA finally passed the revised ETS late last week. The Governor immediately issued an Executive Order making it effective immediately instead of after the 10 day administrative waiting period.  The revised ETS is more closely aligned with guidance issued by the CDC and California Department of Public Health with regards to face coverings. For a more in-depth summary of the new ETS -- and its wild ride to enactment -- see Seyfarth’s pieces here and here.

Trump-Era EEOC Rule Being Rolled Back By House This Week.  Legislation already passed by the Senate to repeal a Trump-era Equal Opportunity Commission rule that required the EEOC to release additional information to companies accused of discrimination is expected to pass the House this week. President Biden is expected to sign the bill into law shortly after it passes the House.  Specifically, the rule required the EEOC to provide employers during the settlement process with a written explanation of the facts regarding its finding of discrimination, the legal basis for the finding, and its method of calculating the damages owed. House and Senate Democrats are using the Congressional Review Act to repeal the rule, which only requires a majority vote in both chambers to repeal recently issued regulations. 

DOL Rulemaking Seeks To Revive Obama-Era Tipped Worker Rule. The DOL has issued for comment a notice of proposed rulemaking that would, if instituted, reinstate an Obama-era rule that required certain employers to pay tipped workers a higher minimum wage when they’re performing work that doesn’t directly generate gratuities. The rule would provide that, when tipped employees spend at least 20% of their workweek on duties that don’t produce tips, they are entitled to the full minimum wage, rather than the $2.13 minimum reserved for workers relying on tips. The rule would also rescind a Trump-era rule, finalized only in late December, that permitted businesses to pay only 2.13 an hour provided employee tasks were related to the employee’s tipped occupation and performed “contemporaneously” with tipped activities.