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ABC Newsline
On March 5, ABC, its Southeast Texas chapter, the Coalition for Workforce Innovation, the Financial Services Institute, the American Trucking Associations, the U.S. Chamber of Commerce, the National Retail Federation and the National Federation of Independent Business filed an amended complaint in the U.S. District Court for the Eastern District of Texas arguing that the U.S. Department of Labor’s Employee or Independent Contractor Classification Under the Fair Labor Standards Act final rule is unlawful and a violation of the Administrative Procedure Act. The district court will review the complaint and response from the U.S. Department of Justice. The final rule goes into effect on March 11.
“The 2024 final independent contractor rule is confusing, vague and unworkable, and will harm construction workers classified as independent contractors because they will lose crucial opportunities for work. Further, the difficult-to-interpret standards in this final rule strip independent contractors of basic freedoms and rights to choose how they work. Replacing the commonsense 2021 final rule was the wrong move by the U.S. Department of Labor and has created an ambiguous standard for determining employee or independent contractor status under the Fair Labor Standards Act,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. Read the business coalition’s statement.
Separately, on March 6, ABC sent a letter to Congress urging members to pass a Congressional Review Act resolution to nullify the U independent contractor final rule.
On Jan. 9, the DOL announced the final rule on Employee or Independent Contractor Classification Under the Fair Labor Standards Act, which rescinds the ABC-supported 2021 final rule and replaces it with a confusing multifactor analysis to determine whether a worker is an employee or an independent contractor. Learn more about the 2024 final rule. Also, watch the ABC-members only archived webinar in the Academy, "Learn What the DOL's Final Independent Contractor Rule Means for ABC Members."
Continue to monitor ABC Newsline for updates.
On March 1, the U.S. Department of Labor sent its Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees final rule to the Office of Information and Regulatory Affairs at the Office of Management and Budget for final review. The rule would alter overtime regulations under the Fair Labor Standards Act. The review at the OIRA is usually the final step in the process before a rule is officially published in the Federal Register. ABC will be meeting with the OIRA to express its serious concerns about the rule.
On Nov. 7, 2023, ABC submitted comments to the DOL in opposition to the proposed overtime rulemaking, which would increase the minimum salary threshold for exemption by nearly 70%, from the current $35,568 annual salary level to $60,209 annually. The DOL also proposes to significantly raise the total annual compensation needed to qualify for exemption under the streamlined test for highly compensated employees from the current total annual compensation of $107,432 to $143,988. Finally, the DOL proposes to automatically update the standard salary level and the HCE total annual compensation threshold every three years.
ABC issued a press release stating, “ABC called on the DOL to withdraw the new proposed rule, which is unlawful, inconsistent with historic norms and will specifically harm small businesses,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “ABC has consistently told the DOL that there is no compelling reason for an adjustment to the minimum salary threshold for exemption since it was increased roughly four years ago. Most importantly, the DOL should recognize that the construction industry, as well as multiple other industries, is currently up against increased geopolitical uncertainty, high materials prices, inflationary pressures and workforce shortages. Specifically, ABC estimates that the construction industry needs to hire more than half a million workers in 2023 alone. Regrettably, the DOL’s proposed salary level increase will further complicate the current economic outlook.”
As a steering committee member of the Partnership to Protect Workplace Opportunity, ABC also signed onto coalition comments criticizing the overtime proposed rule, joining 244 national, state and local organizations representing employers from a wide range of private industry and public, nonprofit and education sectors. The PPWO also created a grassroots toolkit for members to respond to the DOL’s overtime proposed rule.
My journey in the field of construction management began at Montgomery College in Maryland, where I made the decision to pursue this career path out of curiosity for the program and looking for promising career opportunities. With no prior experience in the industry, I was eager to broaden my horizons and gain more exposure. That’s when I became a member of the Student Construction Association and, as an officer, I was able to connect with ABC through its student chapter.
This decision proved to be transformative. It opened numerous doors for me, including the prestigious ABC Virginia and ABC Metro Washington Scholarships, which I was fortunate to receive in 2022 and 2023.
I realized that I needed to get more involved in construction before earning my degree, and to understand what the day to day was like. I applied to multiple companies, until I was hired by a flooring subcontractor in Silver Spring, Maryland, in 2022. I left my position as personal banker at a bank and took the risk of starting in a new field. I soon began to recognize the immense growth potential in construction. I started as a project coordinator and learned how to communicate with general contractors, process all the data, purchase orders and everything else necessary on the administrative side to deliver projects. To this date, I consider that career move to be the best risk I have taken.
Just six months later, I embarked on a new journey, this time with Henley Construction, transitioning from subcontractor work to joining a general contractor. Now, I have been with them for over a year as a field engineer, working on public schools in Montgomery and Fairfax counties. I assist the project manager and superintendent with all documentation throughout the project, and communicate with the owner, design team and subcontractors by doing such things as staying on site for supervision and coordination. I consider myself very fortunate to have the opportunity to wear different hats at Henley, which has allowed me to learn and grow immensely. This transition marked not only my evolution from being a student to a working professional in the industry, but also the beginning of my service on the Workforce Development Committee of ABC Metro Washington.
The past two years have been a testament to growth and engagement for me, as I’ve built valuable connections and dedicated my efforts to assisting students who are treading a similar path toward connecting with the workforce. I am immensely grateful for the opportunities that have come my way, especially for the unwavering support and sense of belonging that ABC Metro Washington has provided. It truly feels like being part of a larger family, and I am excited to continue my journey in the industry with their guidance and support.
Nathalia Marcano
As the presenting sponsor of ABC's 34th annual Excellence in Construction® Awards, the ABC Insurance Trust embraces merit shop principles to highlight the pivotal role that healthy competition plays in improving the construction industry. The Trust’s innovative benefits enhance workforce well-being and make high-performing ABC member companies more appealing to top talent in a competitive market while delivering significant savings on healthcare and retirement plans.
There is a critical lack of competition and transparency in the healthcare arena. The current system relies on ambiguous pricing and third parties with misaligned incentives, which affects how much ABC members and their employees pay for healthcare, leaving members at the mercy of the same organizations year after year.
Employers and employees blindly accept bills from hospitals and insurance carriers without actively knowing the actual cost of the service or, more importantly, the quality of the provider. This conundrum also extends to prescription drugs, where exorbitant prices persist despite more reasonable alternatives worldwide.
The ABC Insurance Trust works with members to introduce healthy competition into the employee benefits evaluation process to eliminate this healthcare dysfunction in an industry deeply affected by rising healthcare costs. Through its newly launched healthcare captive, the Construction Healthcare Alliance, the Trust brings contractors from across the country together to leverage strength in numbers and initiate real change.
Learn more about enhanced benefits tailored to meet every member’s unique needs at abcinsurancetrust.org.
On Feb. 26, ABC joined the U.S. Chamber of Commerce and eight other groups in submitting comments to the U.S. Department of Defense on its Cybersecurity Maturity Model Certification (CMMC) Program proposed rule, which would require federal contractors and subcontractors competing for DOD contracts to demonstrate continued compliance with a range of cybersecurity measures in order to maintain eligibility for performing and winning new federal awards.
The organizations called for more clarity (e.g., definitions), expressed concerns about costs and asked questions regarding capacity and other process and organizational issues.
The comments urged flexible implementation of CMMC program requirements. The comment letter pointed out that, “According to the proposed rule, the defense industrial base, or DIB, consists of 221,286 entities. Of these, the DOD expects that 76,598 will be subject to a Level 2 Certification Assessment, of which 56,789 (74%) are small businesses. The complex CMMC Program would apply to all these entities. Our associations believe that it is essential that DOD builds in flexibility in the administration, application, oversight, and enforcement of the proposed rule. Such flexibility would benefit DOD and the thousands of businesses subject to the CMMC Program. The circumstances of every business differ. The CMMC Program contemplates applying one complex rule, with even more complex accompanying documentation to all these businesses.”
The letter further discussed avoiding harm to small defense contractors. The letter states, “Our associations believe that the proposed rule would discourage many small and disadvantaged businesses from bidding on DOD construction projects. We are concerned about the likely adverse economic impact of the CMMC Program on promoting (sub)contracting between small businesses in the construction industry and DOD.”
In addition, it states, “The decline in small business participation in federal contracting directly correlates with increasing federal regulatory burdens. Surveys of ABC’s membership have found that small business contractors often choose to bid on private sector and state or local government contracts that feature more regulatory clarity and less regulatory burdens, which mitigate expenses related to compliance.”
Background on the Proposed Rule
On Dec. 26, 2023, the DOD published a proposed rule that would require federal contractors and subcontractors competing for DOD contracts to demonstrate continued compliance with a range of cybersecurity measures in order to maintain eligibility for performing and winning new federal awards.
The new requirements would apply to all contractors and subcontractors that process, store or transmit information on contractor servers that meet the standards for Federal Contract Information or Controlled Unclassified Information. Requirements vary from a self-assessment of compliance with cybersecurity measures to triennial assessment and certification of compliance by third-party contractors or the DOD, dependent on the data involved in a specific contract. More than 200,000 companies in the DIB could be affected by the rule.
On Jan. 30, 2024, ABC urged the DOD to extend the current 60-day comment period deadline of Feb. 26 in order to provide adequate time for ABC to analyze the substantial proposed rule, solicit member feedback and provide meaningful input on the proposal. ABC argued a 30-day extension from the current deadline will be vital to ensure that the DOD can receive thorough input from all stakeholders affected by this proposed rule.
On Feb. 8, Inside Cybersecurity reported that the DOD “turned down a request from industry groups to extend the comment period” for 60 days. Thereafter, on Feb. 9, ABC joined a coalition letter urging the DOD to reconsider its publicly reported decision to not extend the comment period and to instead extend it either 30 or 45 days—a middle-ground approach. The DOD did not issue a response.
Continue to monitor Newsline for updates.
As part of a legal challenge against the National Labor Relations Board’s joint employer final rule, a federal judge in Texas delayed the final rule’s effective date from Feb. 26 to March 11. The new standard will only be applied to cases filed after the rule becomes effective.
On Nov. 9, 2023, ABC joined the U.S. Chamber of Commerce and a coalition of business groups in filing a lawsuit challenging the NLRB’s final rule for violating the National Labor Relations Act and for acting arbitrarily and capriciously in violation of the Administrative Procedure Act. The final rule takes an ax to the ABC-supported 2020 NLRB joint employer final rule, which provided clear criteria for companies to apply when determining status.
The NLRB’s joint employer final rule will disrupt long-established, efficient operational processes that are followed by construction service providers that work together to build America. As a result of the confusion and policy whiplash caused by this overbroad standard, contractors will be vulnerable to increased liability and risk, making them less likely to hire subcontractors, most of which are small businesses. Read ABC’s press release about the final rule.
On Dec. 7, 2022, ABC submitted comments to the NLRB, urging the Board to withdraw the proposed rule.
Resources:
Upload your OSHA 300A electronically by March 2 if your NAICS code begins with 23 and have 20 or more employees in an establishment. New additional requirements for 2024, if your NACIS code begins with 2381 and you have 100 or more employees in an establishment, you will also have to upload your OSHA 300 log (after removing data from column B) and the OSHA 301 for each recordable incident (after removing data from field 1, 2, 6 and 7).
Establishments that meet certain size and industry criteria are required to electronically submit injury and illness data from their OSHA Form 300A, 300 and 301 (or equivalent forms) annually to OSHA no later than March 2. OSHA collects this work-related injury and illness data through the ITA, which also includes answers to frequently asked questions. Also, see the Protecting Personally Identifiable Information fact sheet, which explains how establishments can avoid submitting PII through the ITA.
To determine whether you are required to submit this data, visit the ITA Coverage Application. This application only applies to establishments located in states under Federal OSHA jurisdiction. If your establishment is located in a State Plan State, please contact their OSH plan for guidance.
Background:
On July 21, 2023, the U.S. Department of Labor’s Occupational Safety and Health Administration issued its Improve Tracking of Workplace Injuries and Illnesses final rule, which undoes the ABC-supported provisions of the 2019 final rule promulgated under the Trump administration and reprises the 2016 Obama-era rule. The final rule went into effect on Jan. 1, 2024, for certain employers and OSHA intends to make much of the data it collects publicly available online.
In a press release, ABC announced its opposition to the final rule. “Unfortunately, the Biden administration is moving forward with a final rule that does nothing to achieve OSHA’s stated goal of reducing injuries and illnesses,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “Instead, the final rule will force employers to disclose sensitive information to the public that can easily be manipulated, mischaracterized and misused for reasons wholly unrelated to safety, as well as subject employers to illegitimate attacks and employees to violations of their privacy.”
What does the final rule do?
More Information:
In June 2022, ABC submitted comments urging OSHA to withdraw the proposed rule.
For more information click here (https://www.osha.gov/recordkeeping). And while you are reviewing all this data, go ahead and submit your 2024 STEP Safety Management System data by clicking here (https://step.abc.org/Step/WelcomePage).
The National Labor Relations Board’s joint employer rule will go into effect on Feb. 26. The new standard, opposed by ABC, will only be applied to cases filed after the rule becomes effective.
The NLRB’s joint employer final rule will disrupt long-established, efficient operational processes followed by construction service providers that work together to build America. As a result of the confusion and policy whiplash caused by this overbroad standard, contractors will be vulnerable to increased liability and risk, making them less likely to hire subcontractors, most of which are small businesses.
On Nov. 16, 2023, the NLRB extended the effective date of its final rule on Joint Employer Status Under the National Labor Relations Act from Dec. 26 to Feb. 26, 2024.
On Nov. 9, ABC joined the U.S. Chamber of Commerce and a coalition of business groups in filing a lawsuit challenging the NLRB’s final rule for violating the National Labor Relations Act and for acting arbitrarily and capriciously in violation of the Administrative Procedure Act. The final rule takes an ax to the ABC-supported 2020 NLRB joint employer final rule, which provided clear criteria for companies to apply when determining status.
On Dec. 7, 2022, ABC submitted comments to the NLRB, urging the Board to withdraw the new proposed rule.
ABC is conducting an important survey of contractor members and chapter staff to gauge opinions on the U.S Department of Labor’s controversial proposed rule, which significantly overhauls regulations for government-registered apprenticeship programs. Ensuring as many members and chapters as possible respond to this survey will be vital so ABC can provide effective, informed comments that seek regulatory clarity and push back against concerning aspects of the DOL’s proposed rule. ABC has extended the survey deadline to Feb. 22 at 11:59 p.m. ET.
Background
On Jan. 17, 2024, the Federal Register published a controversial 626-page proposed rule that would make significant revisions to the National Apprenticeship System that will affect ABC members, chapters, apprentices and other industry stakeholders participating in government-registered apprenticeship programs.
The proposal would make significant changes to how employer and chapter GRAPs are approved and run, adding more recordkeeping and paperwork requirements while also eliminating flexible competency-based approaches to workforce development in certain circumstances. ABC is concerned that the rule would undermine ABC’s and the construction industry’s investments in GRAPs, which are a key component of ABC’s all-of-the above approach addressing the construction industry’s skilled labor shortage of 501,000 in 2024 alone. ABC is a major participant in the GRAP system, with over 450 government-registered apprenticeship programs operated by chapters across the country.
On Jan. 30, ABC conducted a webinar to provide insight into the proposed rule’s impact on GRAPs. A recording of the webinar is now available on the ABC Academy website. Additionally, on Feb. 16, ABC members and National staff participated in a Small Business Administration roundtable and heard from DOL representatives regarding the rule. Members are encouraged to contact the SBA directly to provide feedback on the proposals impacts to small sponsors and employers.
For more information on the proposed rule, Apprenticeship for America has provided an overview of the rule and a section-by-section analysis of changes from the existing rule. The proposed rule’s table of contents also provides links to specific aspects of the proposal.
ABC distributed the survey on Feb. 7. Please email [email protected] to receive the survey link or if you have any questions.
On Feb. 6, 2024, ABC and the Coalition for a Democratic Workplace sent a letter to two congressional committees urging them to use their oversight authority to rein in the National Labor Relations Board and its general counsel for creating significant tension between federal antidiscrimination law and federal labor law. The letter was sent in light of a recent supplemental decision in the Amazon.com Services LLC v. Gerald Bryson case, in which the NLRB held that Amazon illegally fired a worker who was verbally attacking a co-worker while on strike.
The CDW argues that the NLRB is deliberately creating conflicts between federal antidiscrimination and labor laws, trapping employers in an impossible position with regard to compliance and potentially exposing workers to harassment and discrimination in the workplace. The letter, addressed to the U.S. Senate Health, Education, Labor and Pensions Committee and U.S. House of Representatives Education and the Workforce Committee, emphasizes that union organizers and supporters can advocate and organize without creating hostile work environments for other workers.
“The NLRB and its general counsel are putting employers into an impossible situation,” said Kristen Swearingen, CDW chair and ABC vice president of political & legislative affairs, in a news release. “Due to their efforts to protect union organizers and unionization campaigns at all costs, they’re demanding employers tolerate ‘profane, vulgar, racist, and otherwise insulting language’ in the workplace despite the clear conflict this would create with employers’ legal obligation to create a safe workplace for their workers.
“Employers must be able to act when discrimination or harassment occur in the workplace in order to protect their workers, but the Board and its general counsel are recklessly ignoring that reality,” said Swearingen. “Congress should demand answers from the Board and general counsel on why they’re pursuing this illogical interpretation of the law and exposing employees to dangerous work environments.”