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ABC Newsline
On Aug. 30, the U.S. Department of Labor announced a new proposed rulemaking that would alter overtime regulations under the Fair Labor Standards Act. The proposal increases the minimum salary level threshold to $55,068 annually for a full-year worker and automatically updates the threshold every three years. “ABC is disappointed that the DOL is moving forward with a proposed overtime rule since multiple industries, like construction, are still grappling with the lingering economic consequences of inflation, global supply chain disruptions, rising materials prices and workforce shortages, all of which push operational costs ever higher,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs in a statement immediately following the DOL announcement. “It is unfortunate that the DOL did not listen to our repeated requests to abandon or postpone issuance of the proposed overtime rule until the current economic situation stabilizes or improves, allowing employees and employers to fully navigate the paradigm shift of work in America without new unnecessary and costly red tape,” said Brubeck. ABC’s general counsel, Littler Mendelson P.C. has prepared an analysis of the proposed rule, which includes the following details:
ABC will submit comments in opposition to the proposed rule, which are due 60 days after its official publication in the Federal Register. Background: On May 25, 2023, ABC, as a steering committee member of the Partnership to Protect Workplace Opportunity, as well as 103 other organizations, sent a letter to Acting Secretary of Labor Julie Su urging her to abandon or at least postpone issuing the DOL’s proposed rulemaking to alter the overtime regulations under the FLSA. Further, the letter stated that the DOL’s last update to the overtime regulations went into effect in 2020—just three years ago—which strongly suggests there is no need for urgency in issuing more changes. In spring 2022, ABC and the employer community participated in DOL listening sessions, warning that any rule change is ill-advised. In 2016, the Obama administration issued a final overtime rule that would have doubled the minimum salary level for exemption from $23,660 to $47,476 per year. ABC, along with several other business groups, sued the DOL in federal court and succeeded in blocking the rule from taking effect. In 2019, the Trump administration issued a new overtime rule, which formally rescinded the 2016 rule and readjusted the minimum salary level for exemption to $35,568 per year. The final rule went into effect on Jan. 1, 2020.
Despite being litigated for years, the Biden administration’s National Labor Relations Board has revived controversial policy from the Obama era in the form of its Representation-Case Procedures final rule. The direct final rule, issued without notice and the opportunity to comment, essentially restores provisions of the “ambush” election rule of 2014 and rescinds the remaining ABC-supported provisions of the 2019 final rule. The rule will apply to representation petitions filed on or after Dec. 26, 2023, and employers will have less time to respond to representation petitions.
“The Board’s efforts to again reduce the amount of time between when a union files a representation petition and an election takes place imposes unnecessary urgency on employers, leaving them susceptible to violations of their due process rights and deprives employees of the time needed to become fully informed before deciding whether or not to unionize,” said Ben Brubeck, ABC vice president of regulatory, labor and staff affairs. “Ultimately, the rule infringes on the rights of employers and employees to a fair pre-election process and will have a particularly adverse impact on small construction firms, which typically do not employ legal counsel."
Changes in the 2023 final rule include:
See the NLRB comparison chart of prior and new Representation Case Procedures as well as the fact sheet for more information.
Additionally, learn more about the 2023 final rule and what comes next in ABC general counsel Littler Mendelson’s analysis.
Also, ABC will be offering an ABC members-only webinar on NLRB recent decisions and rules. Details will be posted soon in Newsline.
ABC vehemently opposed the 2014 rule and filed a legal challenge against it.
On Aug. 29, the U.S. Treasury Department’s Internal Revenue Service released a proposed rule and FAQs on provisions of the ABC-opposed Inflation Reduction Act, which will affect the developers, contractors and workers that are building clean energy projects eligible for more than $270 billion in federal tax credits.
The Treasury’s Notice of Proposed Rulemaking, Increased Credit or Deduction Amounts for Satisfying Certain Prevailing Wage and Apprenticeship Requirements, proposes regulations clarifying the applicability of tax credits for the construction of private clean energy projects funded by the IRA––including solar, wind, hydrogen, carbon sequestration, electric vehicle charging stations and more––conditioned on compliance with controversial prevailing wage and government-registered apprenticeship requirements.
ABC issued a press release on the proposed rule, stating:
“As is typical in the federal government’s ‘ready, fire, aim’ approach to issuing regulations, the initial IRS guidance and FAQs on the IRA’s prevailing wage and apprenticeship requirements left many unanswered questions and created confusion that has needlessly stalled the groundbreaking of clean energy projects this year,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “This NPRM is a key step, welcomed by developers, taxpayers, contractors and subcontractors, who for months have been asking for clear and specific guidance on how these new provisions will be implemented. Developers can then decide whether the tax credits are worth the new and significant risks and penalties, and large and small-business contractors and subcontractors can decide whether to bid on and perform such work.”
“Unfortunately, we are months away from a final rule and the industry is unlikely to receive the clarity and confidence it needs to fully leverage the tax credits to break ground on clean energy construction projects until then,” said Brubeck.
IRA Prevailing Wage and Apprenticeship Requirements
Signed into law in August 2022, the partisan IRA provides clean energy developers/taxpayers a bonus tax credit 500% greater than a baseline tax credit of 6%. However, this is conditioned on requirements that a developer ensures its construction contractors meet both prevailing wage and apprenticeship requirements.
To qualify for the enhanced tax credit, developers/taxpayers must ensure that contractors pay all construction workers prevailing wages and benefits established by the U.S. Department of Labor. Developers must also ensure that contractors utilize apprentices enrolled in government-registered apprenticeship programs for certain percentages of all construction hours worked on a project (12.5% of all work hours in 2023 and 15% of all work hours in 2024 and thereafter). All contractors with four or more employees on a jobsite must utilize at least one registered apprentice and comply with applicable apprenticeship ratios thereafter.
The developer/taxpayer faces considerable penalties if prevailing wage and registered apprenticeship requirements are not met, and those penalties increase if the IRS determines the failure was due to intentional disregard.
The IRS proposed rule comes on the heels of initial inadequate IRS guidance––required to be issued by the IRA statute––that went into effect on Jan. 30, 2023. The IRS guidance remains in effect until the final rule is published and takes effect at a date to be determined.
ABC submitted comments on Nov. 4, 2022, to the Treasury in response to its request for comments on future initial guidance implementing these tax credits. ABC outlined concerns with the IRA’s unprecedented expansion of inflationary prevailing wage and apprenticeship requirements and the lack of clear guidance from Treasury as a result of it failing to issue regulations through a traditional notice-and-comment rulemaking. On Nov. 29, ABC issued a statement on the IRS/Treasury’s inadequate initial guidance.
Following extensive feedback from ABC and industry stakeholders on the November 2022 guidance, this summer the Biden administration announced a formal rulemaking on the matter.
Highlights of the Treasury Proposal
The proposed rule specifies that clean energy projects can be exempt from prevailing wage and apprenticeship requirements only in the following cases:
The proposed rule contains the following key provisions:
Separately, on Aug. 25, the Department of Labor’s Office of Apprenticeship issued a bulletin stating that solar panel installation occupations are not currently deemed “apprenticeable,” meaning the DOL and state apprenticeship agencies will not be able to approve government-registered apprenticeship programs specific to this occupation. The bulletin states that the work processes of this role fall under existing apprenticeable occupations such as electricians, iron workers, operating engineers, carpenters and laborers. This is expected to affect applicable solar installations receiving IRA funding.
Next Steps
ABC is conducting a thorough review of the 129-page rulemaking and plans to address concerns with the proposed rule in formal comments due to the IRS/Treasury by Oct. 29. ABC also encourages ABC members and stakeholders to participate in this rulemaking and comment on the proposed rule by Oct. 29. ABC will survey its members on key aspects of the proposed rule to help inform these comments.
In addition, ABC encourages ABC members and other contractors to connect with more than 450 government-registered apprenticeship programs offered by ABC chapters that can help contractors meet IRA apprenticeship requirements and win contracts for clean energy projects seeking the full IRA tax credits.
ABC will also host an ABC members-only webinar on Sept. 14 at 3:30 p.m. ET. Register here.
Stakeholders can review ABC and government resources on the IRA tax credits for clean energy projects at abc.org/ira.
Please direct questions or comments to [email protected].
On Aug. 29, the U.S. Environmental Protection Agency and Army Corps of Engineers issued a final rule and fact sheet regarding amendments to the definition of “waters of the United States” subject to Clean Water Act regulation. This rule is aimed at bringing the January 2023 WOTUS final rule into compliance with the U.S. Supreme Court’s May 25 decision in Sackett v. Environmental Protection Agency.
ABC issued a statement in response to the rule, with Vice President of Regulatory, Labor and State Affairs Ben Brubeck stating:
“Unfortunately, these revisions fail to fully implement the U.S. Supreme Court’s ruling in Sackett v. Environmental Protection Agency, which placed clear boundaries on the scope of the federal government’s authority while maintaining reasonable environmental protections for America’s waterways.
“Instead, this rule, issued without meaningful opportunities for input from the construction industry and other stakeholders, will contribute to continued regulatory uncertainty and unnecessary delays for critical infrastructure projects across the nation. ABC urges the Biden administration to issue broader revisions to WOTUS in full compliance with the Supreme Court’s decision.”
The final rule makes these adjustments to WOTUS:
The rule implements some of the key wins from the Sackett decision. However, it fails to fully implement the court’s opinion, including on the definition of “relatively permanent” waters, and may result in continued regulatory uncertainty. ABC previously submitted recommendations to the agencies regarding implementation of Sackett as part of the Waters Advocacy Coalition.
The final rule will immediately take effect upon publication in the Federal Register. At that time, the amended version of the January 2023 final rule will be in effect, except in states where it is currently blocked by a preliminary injunction.
Associated Builders and Contractors today announced its opposition to the U.S. Department of Labor’s Occupational Safety and Health Administration announcement of a proposed rule, Worker Walkaround Representative Designation Process. The proposed rule would allow an employee to choose a third-party representative, such as an outside union representative, to accompany an OSHA inspector into nonunion facilities.
“ABC is deeply disappointed that the Biden administration is trying to revive a failed Obama-era initiative, which was bad policy then and is bad policy now,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “This proposal does nothing to promote workplace safety and it will have a substantial negative impact on the rights of employers and their employees.”
“By allowing outside union representatives access to nonunion employers’ private property, OSHA is injecting itself into labor-management disputes and casting doubt on its status as a neutral enforcer of the law,” said Brubeck. “Unfortunately, many outside union organizer representatives have a biased agenda that is not focused on safety or health, which could distract OSHA inspectors from their primary purpose of workplace safety.
“OSHA can have a bigger impact on jobsite safety by fostering positive partnerships with employers and promoting safety practices that produce results," said Brubeck. "For example, in ABC’s 2023 Safety Performance Report, top-performing STEP participants achieved a 688% improvement in safety performance compared to the U.S. Bureau of Labor Statistics construction industry average in 2022.”
ABC continues to review the proposed rule and assess options for a legal challenge. To learn more about the rule, register for ABC’s members only webinar on OSHA developments affecting the construction industry on Sept. 20 at 2 p.m. ET.
To learn what employers can do to prepare, see ABC general counsel’s, Littler Mendelson’s, analysis.
On Feb. 21, 2013, OSHA issued a letter of interpretation endorsing union representatives and other nonemployee third parties accompanying OSHA inspectors on walkaround inspections at nonunion workplaces, which ABC adamantly opposed, expressing serious concerns. OSHA eventually rescinded the letter of interpretation on April 25, 2017.
On Aug. 25, 2023, the National Labor Relations Board issued its decision in Cemex Construction Materials Pacific, LLC, which imposes a new framework that greatly expands the Board’s ability to impose unions on employees without a secret ballot election. The Board’s decision overrules precedent that has stood for over half a century.
The ABC-led Coalition for a Democratic Workplace issued the following statement from ABC Vice President of Legislative & Political Affairs and CDW Chair Kristen Swearingen:
“The Board’s decision to force unions on employees without an election is contrary to the law and the fundamentals of workplace democracy. Employees deserve the right to decide whether or not they want union representation through a secret ballot election. The Board should be protecting this right and doing everything in its power to promote employee participation in elections—not forcing unions on employees based on unreliable authorization cards. The Board decision overrules precedent that has stood for over half a century and been upheld by the U.S. Supreme Court. As dissenting Member Kaplan explained, the new standard will have ‘the primary effect of negating the rights of current employees rather than furthering them’ and therefore ‘defeats, rather than effectuates, the policies of the [Act].’
“Not only is CDW disappointed in the ruling, but we’re disappointed that the Board chose to move forward with such a fundamental change to labor law without seeking input from stakeholders. This is more concerning given that CDW and others specifically called on the Board to invite amicus briefs in the case. The regulated community should have had an opportunity to express their concerns before such a radical change to policy was made.”
On May 3, 2022, ABC joined CDW in submitting a motion that requested the NLRB to solicit amicus briefs in Cemex in response to the general counsel’s request that the Board overrule multiple longstanding and significant Board precedents in the case.
Littler published additional analysis on the decision.
Despite being litigated for years, the Biden administration’s National Labor Relations Board has revived controversial policy from the Obama era in the form of its Representation-Case Procedures final rule. The direct final rule, issued without notice and the opportunity to comment, essentially restores provisions of the “ambush” election rule of 2014 and rescinds the remaining ABC-supported provisions of the 2019 final rule. The rule will apply to representation petitions filed on or after Dec. 26, 2023.
“The Board’s efforts to again reduce the amount of time between when a union files a representation petition and an election takes place imposes unnecessary urgency on employers, leaving them susceptible to violations of their due process rights, and deprives employees of the time needed to become fully informed before deciding whether or not to unionize,” said Ben Brubeck, ABC vice president of regulatory, labor and staff affairs. “Ultimately, the rule infringes on the rights of employers and employees to a fair pre-election process and will have a particularly adverse impact on small construction firms, which typically do not employ legal counsel."
Learn more about the 2023 final rule in ABC general counsel, Littler Mendelson’s analysis.
The NLRB’s final rule and fact sheet have more information.
On Aug. 23, the U.S. Department of Labor officially published its final rule, Updating the Davis-Bacon and Related Acts Regulations, in the Federal Register. The regulation’s drastic revisions to existing rules regarding government-determined prevailing wage rates that must be paid to construction workers on federal and federally assisted construction projects funded by taxpayers will now take effect on Oct. 23.
ABC issued a statement opposing the new rule, stating:
“This is yet another Biden administration handout to organized labor on the backs of taxpayers, small businesses and the free market,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “Unfortunately, the DOL’s final rule disregards the feedback of ABC contractors, construction industry stakeholders and thousands of small businesses urging the withdrawal of this unnecessary, costly and burdensome regulation.”
All contracts entered into after Oct. 23 will be subject to the new rule’s provisions. Additionally, in certain situations the rule may apply to existing contracts. This includes if a contract is changed to include substantial Davis-Bacon-covered work not within the scope of the original contract, if an option to extend a contract’s term is exercised and for ongoing contracts not tied to completion of a particular project.
For more information on the final rule, see ABC’s previous Newsline article, ABC general counsel Littler Mendelson’s analysis and ABC’s online resources at abc.org/davisbacon. ABC also held a members-only webinar on the final rule on Aug. 21, and the recording is now available on ABC’s Academy.
The DOL will also be conducting webinars on the final rule on Sept. 13 and 14, and has provided compliance resources on the final rule.
For any questions regarding the final rule, please contact Michael Altman at [email protected].
ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck was recently interviewed on Fox News’ “America Reports” explaining the construction industry’s labor shortage and how that will affect the massive injection of capital into infrastructure under recently passed legislation.
“It’s the result of a perfect storm of regulatory, demographic and economic issues all happening together,” said Brubeck, citing the skilled labor shortage of half a million workers in 2023, according to ABC.
“We’re seeing 40% cost increases in construction materials prices since before the pandemic,” said Brubeck. “We’re also seeing some Biden administration policies that are increasing the cost of construction and artificially exacerbating the skilled labor shortage.”
ABC and its 68 chapters are working hard to attract new talent into the industry through various pathways appealing to different populations, said Brubeck. ABC offers more than 300 government-registered apprenticeship programs across the country. ABC is also recruiting veterans, reentering citizens, careers switchers and young people into the industry.
Equipment of any kind needs to be accompanied by training, evaluation, inspection, follow-up and, most importantly, an operator who understands the potential hazards and carries out their duties in a safe manner.
Personal Protective Equipment
Some people think they’re safe simply because they are wearing their PPE—helmet, safety glasses, gloves, ear protection and safety toe boots. However, as vital as PPE is for your team, PPE does nothing to physically prevent an accident from occurring in the first place.
For example, we see this on display every day on the roads—safety features alone don’t prevent accidents. Cars are equipped with protections such as anti-lock brakes, blind spot monitoring, front-wheel drive and more, all to make driving safer. Some might even equate a properly working airbag as a form of PPE for the driver. The question to consider is, “Did the airbag do anything to physically prevent the accident?” Absolutely not.
The same is true with PPE, which is designed to minimize the injury or prevent death once the accident has already happened. This point is crucial to understand—PPE does nothing to physically prevent the accident. Its purpose is to minimize the effects of the accident.
The only device that is powerful enough to prevent an accident from happening is the human mind, fully engaged in understanding the task at hand. You and your team need to be diligent and in the right mindset at all times. Take the appropriate precautions to prevent an accident from ever happening. Perform visual hazard analysis and maintain a physically safe workplace. As conditions change at the worksite, you must adjust to maintain safety. This awareness is key to keeping everyone safe.
Mobile Equipment
Today’s mobile equipment is safer than ever before. Yet, distractions, impairment or improper training can cause an incident. Before anyone operates mobile equipment, these conditions must be met:
Only when the mind is fully educated and actively engaged with safety protocols will the mobile equipment be safe to operate.
Educate the Mind To Prevent Accidents
Safety is everyone’s responsibility throughout the entire organization, and everyone needs to be fully and thoughtfully engaged. Donning a pair of safety glasses or a pair of gloves isn’t enough. Proper training, culture and mindset is the key to success and lower incidence rates. Find opportunities to build your health and safety culture every day.
Looking for help building your safety program?
Discover resources available through ABC’s STEP Safety Management System and other health and safety topics at abc.org/safety.
For more information or assistance, please reach out to Joe Xavier or Aaron Braun.