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Secretary of Labor Solis Resigns

On January 16, 2013 by Schnader in Labor and Employment

By Scott J. Wenner

On January 9, 2013, Labor Secretary Hilda Solis submitted her resignation to President Obama.  A former member of Congress from Southern California, Solis has long-standing ties to the union movement.

Solis began her tenure as Secretary of Labor by proclaiming her intent to pursue an aggressive enforcement agenda, asserting that there was “a new sheriff in town.”  Indeed, in both enforcement and regulation, the Department of Labor shifted dramatically away from the more collaborative approach of her predecessor, Elaine Chao, towards a punitive enforcement strategy.  Under Secretary Solis, the Wage and Hour Division and OSHA dramatically increased its budgets and the number of investigators the agencies deployed to the field, which unsurprisingly yielded reportedly record numbers of investigations and inspections. The agencies also stepped up the penalties that were assessed for violations.  While penalties are constrained by the laws they enforce, both Wage and Hour and OSHA simply changed the manner of penalty assessment in ways that have assessed higher penalties without having to seek legislation – e.g., by assessing individual penalties for similar violations instead of grouping them together.

The enforcement agenda under Solis was, at least in her first two years, matched by an equally ambitious and potentially devastatingly costly regulatory agenda led by the sub-agencies.  Progressive activists were installed to head OSHA, OFCCP, OLMS and the Office of the Solicitor of Labor.  (The nominee to lead the Wage and Hour Division was too controversial to be confirmed.)  Primarily in 2010 and 2011 these agencies, along with the Wage and Hour Division, proposed a group of regulations that produced considerable controversy, including

  • “Right to Know” – a Wage and Hour initiative to require disclosure to all affected persons of their status as exempt or non-exempt;
  • Injury & Illness Prevention Plan – OSHA’s proposed rule to require employers to create a formal plan, with employee involvement, to find and fix all workplace hazards;
  • Affirmative Action Requirements for Disabled and Veteran Workers and Applicants – two sets of proposed regulations by OFCCP that would impose goals and burdensome new recordkeeping and reporting obligations on government contractors;
  • Expanded Employer and Consultant Reporting for “Persuader Activities” – proposal to dramatically expand identification and reporting of activities by consultants, including attorneys, who assist employers in efforts to persuade workers not to organize to exercise their rights to collectively bargain.

Although first introduced amidst much fanfare as part of the Department’s “Plan/Protect/Prevent” program, the agency’s push to publish them as final rules quietly stalled in the 2012 election year.

Litigation tactics employed by Secretary Solis’s Solicitor of Labor, Patricia Smith, were criticized as being calculated to deny employers fundamental fairness from no lesser body than the United States Supreme Court.  In Christopher v. Smithkline Beecham Corp., the majority opinion was archly critical of the Solicitor’s practice of using amicus (“friend of the court”) briefs interjecting its views into private litigation to advance new and different interpretations of existing laws and regulations from those held before.  The Court found that these tactics deprived employers of the fair notice of the agency’s expectations to which they are entitled. It added that by first announcing a new regulatory position in a series of amicus briefs filed in private litigation, the Department was evading its rulemaking obligation to publish notice and seek public comment before adopting what amounts to a new rule with which employers must comply.

Expectations Under a New Secretary of Labor

While there seems to be no consensus yet over whom the President will choose as his next Secretary of Labor, there is little disagreement that the new head of the Department of Labor will continue the agenda promoted by Secretary Solis.  With a group of rules on the shelf and ready to publish in final form, it is fair to expect the Department to push these new regulations out and to continue its aggressive enforcement approach – particularly within those agency units whose heads will be remaining at the Department.