Policy Week in Review – December 12, 2025

President Trump Signs Executive Order to Limit State Regulation of Artificial Intelligence 

On December 11, 2025, President Trump signed an executive order purporting to limit the ability of states to regulate the use of artificial intelligence (AI). The order’s stated purpose is to ensure that American AI companies are “free to innovate without cumbersome regulation” and to “remove barriers to American AI leadership.” The order cites the proliferation of AI legislative proposals in state legislatures as undermining that goal (although it bears note that few if any of these proposals have or are likely to become law). Read here for Littler’s analysis. 

CWI Calls on Supreme Court to Protect Arbitration Agreements in the Transportation Industry 

In an amicus brief filed on Thursday, the Coalition for Workforce Innovation (CWI) urged the U.S. Supreme Court to reject misguided interpretations of the Federal Arbitration Act (FAA) that threaten arbitration agreements in the transportation industry. Currently, the FAA broadly guarantees that arbitration agreements will be enforced according to their terms. The law also makes a limited exception for workers “engaged in” interstate commerce—i.e., people who work to move goods over state lines. In recent years, many cases involving that exception have also involved worker misclassification. Workers have claimed both that they were misclassified as independent contractors and that the FAA doesn’t apply because they worked to move goods interstate. Some lower courts have approached these cases by asking whether the workers were “independent” of the companies shipping the goods. If they weren’t independent, these courts have suggested that the workers are part of an unbroken stream of interstate transportation, even if the workers personally delivered goods only within state lines. But as CWI explained in its brief, that approach conflates the merits of the dispute (independence) with the FAA exception. And by doing so, it denies the parties exactly what the FAA guarantees them—the right to a decision by an arbitrator. CWI urged the Court to draw a bright line between the two issues.

CWI was represented by Littler’s WPI. A copy of the brief can be found here.  

Bipartisan Legislation Introduced to Support Hiring Individuals with Disabilities 

The Helping Individuals Rejoin Employment (HIRE) Act, introduced by Representatives French Hill (R-AR), Mike Carey (R-OH), Sharice Davids (D-KS), Debbie Dingell (D-MI), and Nicole Malliotakis (R-NY), would support the hiring of individuals with disabilities by adding Social Security Disability Insurance recipients to the list of eligible targeted groups that qualify for the Work Opportunity Tax Credit (WOTC). The legislation would also extend WOTC, set to expire on January 1, 2026, for five years. WOTC is an existing federal tax credit available to employers that hire individuals who have consistently faced barriers to employment, including veterans, ex-felons, qualified SNAP benefits recipients, and those experiencing long-term unemployment. 

House Democrats introduce Legislation to Increase Penalties for Labor Violations

On December 10, House Democrats introduced the Labor Enforcement to Securely (LET’s) Protect Workers Act that would, among other provisions, increase civil monetary penalties for violations of child labor, minimum wage and overtime, worker health and safety, and farmworker protection standards, and create new penalties for violations of the National Labor Relations Act. The legislation is joined by a report recently issued by House Democrats on the Committee on Education and the Workforce, titled A Slap on the Wrist: How it Pays for Dishonest Employers to Take Advantage of Workers, which states in its introduction, “Regrettably, civil monetary penalties for labor and employment laws are egregiously low, to the point that if an employer is caught committing a labor violation the penalty amounts to the ‘cost of doing business’ rather than a deterrent.” 

House Subcommittee to Hold Hearing on Union Accountability

House Subcommittee on Health, Employment, Labor and Pensions Chair Rick Allen (R-GA) will hold a hear on Wednesday, December 17 at 10:15 a.m. ET, titled “Ensuring Union Leaders Represent Members, Not Agendas.” The names of hearing witnesses have not yet been publicly released.