Employee compensation and benefits could see drastic changes under a Biden administration, according to some in the field.
The presumptive president-elect's campaign platform provides some insight into the possibilities, as does the Obama administration's record, they said. Among other things, employers may see expanded benefits mandates, higher minimum wage rates and an overtime rule redo.
Given that the U.S. is still working through a pandemic, Biden's previously stated plans to focus on workplace precautions such as installing physical barriers, crowd-size limits, testing and contact tracing are notable in the healthcare context. His website also calls for a "restart package" for small businesses to cover the costs of items like personal protective equipment.
The former vice president also plans to "build on the Affordable Care Act" (ACA) in part by offering more choice. "We believe the Biden administration will seek to shore up the Affordable Care Act, which provides increased access and prevents sale of health plans that might not provide meaningful benefits and might 'skim off' the healthiest people, making health care coverage less affordable for those who most need it," said Jeff Levin-Scherz, North American co-leader of Willis Towers Watson's health management practice.
The ACA is currently the subject of a case before the U.S. Supreme Court, which has been asked in part to determine whether the law's individual mandate is unconstitutional and whether it is severable from the rest of the ACA. Members of the court's conservative majority appeared to favor upholding the remainder of the ACA even if the mandate is struck down, Healthcare Dive reported.
Aside from strengthening the ACA, Biden could also attempt to expand Medicare, and "there might also be more vigorous enforcement of antitrust laws, given [the] increasing pace of provider consolidation which has been well-documented to raise unit costs," Levin-Scherz said in an email.
"While coverage expansion is important, employers have long held that we must also move away from a system built around paying for volume to one built around paying for value to make coverage gains sustainable in the long-term," said Steve Wojcik, vice president, public policy at the Business Group on Health, in response to a query about the Biden administration's impact on employer-sponsored healthcare benefits.
In the run-up to the election, Biden endorsed on multiple occasions a $15 minimum wage at the federal level and has stated support for ending the federal subminimum wage for individuals with disabilities. The former vice president's platform specifically called for an increase to the $15 mark by 2026, but states and local governments likely will continue to implement minimum-wage measures should this push be held up in Congress, attorneys at Fisher Phillips wrote in a blog post for the firm.
Biden's minimum-wage platform also included a pledge to award federal contracts only to employers that pay a $15 hour minimum wage and offer "family sustaining benefits." Biden could achieve this policy by issuing an executive order, according to a report by attorneys with Littler Mendelson.
The emergency paid leave provisions of the Families First Coronavirus Response Act are due to sunset Dec. 31. The House has twice passed separate bills, both named the Health and Economic Recovery Omnibus Emergency Solutions Act, or HEROES Act, to expand the FFCRA's paid leave provisions to all U.S. employees and extend them through 2020, the Littler attorneys said, but neither bill has passed the Senate.
"Emergency paid leave aside, if Democrats gain control of both houses of Congress, the country could see a more permanent paid sick leave policy under a Biden administration," the Littler attorneys said. "A national paid sick leave law has long been a Democratic priority."
Biden's platform calls for legislation that would grant all workers 12 weeks of paid leave for their own or a family member's serious health condition. But with Republicans seemingly on track to retain a majority in the Senate, past fault lines on paid leave at the national level may continue to obstruct such proposals.
Employers can expect to see a Biden administration reinstitute the U.S. Equal Employment Opportunity Commission's pay-data reporting requirements under EEO-1 Component 2, per the Fisher Phillips analysis. EEOC issued pay data collection via EEO-1 forms for fiscal years 2017 and 2018, after a lengthy court battle with advocacy groups, but it refused in 2019 to renew the collection request while indicating that it could institute pay data collection through a separate, future rulemaking. In its latest update on the 2017 and 2018 collection, EEOC said it would complete its analysis by Dec. 31.
The initiative was originally spearheaded during the Obama years and "only briefly took effect before being ended by the Trump administration," Cheryl Pinarchick, regional managing partner at Fisher Phillips and co-chair of its Pay Equity Practice Group, said in the firm's analysis. "It seems likely we'll see President Biden resurrect this program fairly quickly."
Biden also supports the Paycheck Fairness Act, a Congressional bill to address wage discrimination on the basis of sex by amending the Fair Labor Standards Act. The bill passed the House in March 2019 along largely partisan lines, and it has not yet been taken up by the Senate.
Wage and hour law
Aside from the federal minimum wage, Biden could strengthen worker protections. According to the Littler report, his campaign has stated plans to invest in infrastructure, and that investment could include provisions such as "requiring contractors to enter into project labor agreements, agreeing to union neutrality provisions, or requiring contractors to disclose information about their employees' compensation."
In general, employers may face enhanced penalties and enforcement actions for non-compliance with wage and hour laws under Biden. "All in all … I expect President Biden to advance a progressive agenda designed to benefit and protect workers and to take a tougher stance on employers who do not comply," Kathie Caminiti, partner at Fisher Phillips and co-chair of the firm's Wage and Hour Law Practice Group, said in the analysis.
A number of regulations put into effect by the Trump administration's U.S. Department of Labor could be revised or otherwise placed under review, according to the Littler report. One such rulemaking is the minimum salary threshold for white-collar overtime exemption under the Fair Labor Standards Act, which the Trump administration increased last year after rescinding an Obama-era rule that would have set the threshold even higher. "An effort to further increase the minimum salary required to meet the exemption tests, or further revisions to the duties tests, may be contemplated," the report said.
Additionally, a Biden administration may decide to review the Trump administration's rules on independent contractor and joint employer status under the FLSA, the Littler report noted.