Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
After the recent resignation of Alex Acosta, President Trump has announced his intent to nominate Eugene Scalia—son of the late U.S. Supreme Court Justice Antonin Scalia—as Secretary of the Department of Labor (DOL). The announcement was made via social media on July 18, 2019.
Scalia is currently a partner in private practice in Washington D.C. and has years of experience in both administrative and labor law. As a litigator, Scalia has represented many large businesses in high-profile cases, and his aggressive defense of management has earned him a reputation as an effective litigator.
Scalia also brings government experience to the table. He was previously the solicitor of the DOL, taking the post in January 2002 after recess appointment by President George W. Bush. Scalia also has prior experience at the Department of Justice, where he served as Special Assistant to U.S. Attorney General William P. Barr, during his first tenure in that post, from 1992 to 1993. Scalia attended the University of Chicago for law school and has also served as a lecturer there in labor and employment law. Scalia is expected to take into account the needs of the regulated community to have certainty and predictability concerning DOL regulations. Further, he is likely to try to create more uniformity within the DOL among its various regions.
The confirmation process can be lengthy, involving significant paperwork, background checks, and an initial hearing of the candidate before the Senate Health, Education, Labor and Pensions (HELP) Committee—all before a full Senate vote can occur. Notably, this process has not moved as quickly as possible during the Trump Administration for certain positions, and Scalia’s path may be slowed by the upcoming Senate six-week recess.
Nonetheless, the Republican-controlled Senate has been very supportive of Scalia’s nomination thus far. Supporters contend that his track record of challenging regulations and his labor law litigation experience shows his deep understanding of this field. Democrats, however, are likely to be critical of the nomination due to Scalia’s record of perceived hostility toward unions and his willingness to attack government regulations.1
As the confirmation process unfolds for Scalia, the current acting secretary of the DOL is Deputy Labor Secretary Patrick Pizzella. Pizzella has worked in many government agencies and has a reputation for getting things done. With Scalia’s nomination, Pizzella’s tenure as acting secretary will be limited.
As leadership shifts at the helm of the DOL, the agency itself is expected to continue apace with current initiatives, including the issuance of opinion letters. Employers are currently awaiting the DOL’s final pronouncement of several impactful regulations. Proposed rules were issued by the Wage and Hour Division (WHD) on three key issues earlier this year, and the agency is currently reviewing comments received during the notice and comment period.2 These pending issues include:
- White-Collar Overtime Exemption. Comments closed on May 21, 2019 for the proposed regulation regarding appropriate salary cut-offs for exempted white-collar employees.3 The proposed rule seeks to find a balance between Obama-era proposed salary exemption levels (which would have been set at nearly $48,000, if the rule had been enforced) and the existing exemption level of $23,660, by setting the salary threshold at $35,308. No proposed date has been set for the final rule, but Pizzella has committed to ensuring it is released before the end of the year.
- Joint Employment. Another proposed regulation would revise how businesses can determine whether they are “joint employers” for purposes of the Fair Labor Standards Act.4 Comments are closed, and the WHD has not set a projected date for this final rule.
- Regular Rate. The WHD is also seeking to clarify and update the FLSA’s “regular rate” requirements, focusing on the types of compensation and benefits that employers must include in the overtime pay calculation.5 The proposal would confirm that certain types of employer-provided benefits may be excluded from the regular rate, such as wellness benefits, discounts on retail goods, and payouts of unused vacation time. The comment period on this proposed rule has closed.
Littler will continue to follow Eugene Scalia’s confirmation process, as well as ongoing regulatory developments at the DOL. We will provide further notice and analysis as these dynamic situations unfold.
1 See Catherine Lucey and Natalie Andrews, Trump to Nominate Eugene Scalia to Serve as Labor Secretary, Wall St. J., July 18, 2019, at A4.
2 See James A. Paretti, Jr. and Michael J. Lotito, Agencies Update Regulatory Agenda for 2019 and Beyond, Littler ASAP (May 24, 2019); see also James A. Paretti, Michael J. Lotito, Tammy D. McCutchen and Tessa Gelbman, Joint Employment, Wage and Hour Changes are on the Regulatory Horizon, Little ASAP (Oct. 17, 2018).
3 See Tammy McCutchen, Lee Schreter, and Maury Baskin, DOL Proposes to Increase the Minimum Salary for the “White Collar” Overtime Exemptions to $35,308, Littler ASAP (Mar. 8, 2019).
4 See Tammy McCutchen, Maury Baskin and Michael J. Lotito, DOL Issues Third Proposed Rule in Two Weeks, This Time on Joint Employment, Littler ASAP (Apr. 1, 2019).
5 See Tammy McCutchen and Whitney Ferrer, DOL Releases a Proposed Rule to Clarify the Types of Compensation that Employers Must Include in the Overtime Calculation, Littler ASAP (Mar. 28, 2019).