Now that the Biden-Harris administration is installed in the White House, employers are anxious to see what happens next. Since Franklin Roosevelt took office in 1933, presidents have sought to make the most of their first 100 days. For the Biden-Harris administration, that urgency has been compounded by a deadly pandemic and flagging economy.
A few days before inauguration, now-President Biden released a synopsis of his American Rescue Plan, a $19 trillion relief bill geared to containing COVID, offering aid to struggling families, and building back businesses and jobs. Within his first 24 hours, he issued 30 executive orders to advance that plan.
While we still have much to learn about its specifics (and no way to know how much will become law) it’s not too soon to start preparing—particularly with regard to these key labor initiatives that will impact employers managing an hourly workforce.
A Restored, Expanded Paid Leave Mandate
While the December 2020 stimulus bill extended the Families First Coronavirus Response Act employer tax credits through March 2021, it did not extend the mandate that requires employers with 50-500 employees to provide paid leave.
The American Rescue Plan not only would restore that mandate, but extend it to cover smaller and larger employers. Employers with under 500 workers could continue to be reimbursed through tax credits. The mandate would expire September 30, 2021.
While arduous for some employers, the FFCRA mandate did slow COVID’s spread. Studies demonstrate that it reduced daily infection rates by 400 cases per day in states that previously didn’t have paid sick leave laws.
COVID-specific OSHA Protection Standards for Employers
On January 21, President Biden signed the Executive Order on Protecting Worker Health and Safety, which calls on OSHA to issue updated Covid-19 workplace standards within the next two weeks.
In addition, the order directs various government agencies to collectively determine if emergency temporary standards are needed to protect workers not ordinarily covered under OSHA regulations.
Finally, it directs OSHA to focus its enforcement efforts on large-scale COVID-19 violations and retaliation cases. This is consistent with the American Rescue Plan, which asks Congress to authorize additional funding for OSHA enforcement and training grants for employers and workers.
A $15 Federal Minimum Wage
The American Rescue Plan also calls for raising the federal minimum wage to $15 an hour, more than double the current federate rate of $7.25, while ending the tipped minimum wage and sub-minimum wage for people with disabilities.
Before the election, the Biden-Harris platform supported a gradual minimum wage increase over the course of several years. However, the newly-released plan does not include details on how, or how quickly, these changes would be made.
While this is expected to meet fierce resistance from congressional Republicans, it should be noted that 29 states already have higher minimum wage laws–including the unlikely state of Florida, which will phase in a $15 minimum wage by 2026.
Expanded Protections for LGBTQ Workers
One of the first orders President Biden issued was the Executive Order on Preventing and Combating Discrimination on the Basis of Gender Identity or Sexual Orientation, which prohibits LGBTQ discrimination regarding matters of education, housing, healthcare, and employment.
It’s unclear how this will impact employers, although it will likely affect protocols regarding hiring, terminations, promotions, and benefits.
The order charges each government agency to review all existing regulations within its purview, identify where changes and additions are needed, and develop a plan for moving forward within 100 days.
Higher Costs, Healthier Country?
Will the Biden administration’s first 100 days result in higher labor costs and increased compliance obligations for employers with an hourly workforce? Quite possibly. On the other hand, additional elements of its COVID relief plan—which include investing millions in job creation, infrastructure, and manufacturing—may help U.S. businesses rebound more rapidly.
Case in point: after reviewing the $1.9 billion stimulus plan, Goldman Sachs raised its 2021 GDP forecast to 6.6%, while predicting a lower unemployment rate of 4.5% by year end. Moody’s Analytics went even further, forecasting nearly 8% GDP growth this year and predicting near full employment by the third quarter of 2022. Despite legitimate concerns, there’s plenty of reason for optimism.
In the meantime, there are steps employers can take to ensure they’re ready for whatever lies ahead. For example, it’s likely that some initiatives will require specific training for managers and workers. If you don’t already have a robust online training platform in place, now is the time to secure one.
Furthermore, if your HR and payroll software doesn’t adapt easily to meet new labor requirements—or offer automated tools to ensure compliance—there will never be a better time to find one that does. Like EPAY.
EPAY HCM is designed specifically for employers that manage an hourly workforce. Our system is not only packed with advanced compliance tools, but is proven to help employers reduce their labor costs by 5% or more. Learn how we can help you avoid Department of Labor violations, while offsetting potential labor cost increases.