On Wednesday, the full House Committee on Education and the Workforce held a hearing to discuss the policies and priorities of the Department of Labor. Earlier in the week, the agency released its 2012 budget request, which seeks $12.8 billion in discretionary budget authority and 17,848 full-time equivalent employees (FTE). Although the proposal would reduce the Department’s overall discretionary spending by 5% from current levels, the budget would increase funding for the agencies charged with regulating and enforcing worker protections. Several divisions within the DOL – the Wage and Hour Division (WHD), Occupational Safety and Health Administration (OSHA), Mine Safety and Health Administration (MSHA), Employee Benefits Security Administration (EBSA), and the Office of Federal Contract Compliance Programs (OFCCP) – would each receive additional funding under a budget that allocates a total of $1.8 billion for DOL’s worker protection agencies. Given President Obama’s plan to freeze all non-security discretionary spending and DOL’s overall discretionary budget reduction, the increase in resources for worker protection demonstrates the Administration’s continued commitment to enhancing the regulation and enforcement of labor and employment laws. For a complete analysis of the DOL’s budget request, see Littler’s ASAP: U.S. Department of Labor's 2012 Budget Shows Increasing Resources Toward Regulation and Enforcement of Employment Laws.
In his opening statement, Committee Chairman John Kline (R-MN) criticized a number of DOL rules that he said were “designed to favor Big Labor at the expense of small businesses.” In addition, he stated that “workers and their employers need simple and fair rules of the road that promote health, safety, and accountability; they do not need a bureaucracy that continues to grow in size and complexity and stifles the freedom and innovation our economy desperately needs to grow and prosper.”
During the hearing, Labor Secretary Hilda Solis defended (pdf) the DOL’s policies and regulations, and responded to specific questions about the department’s budget request. More than one committee member questioned the DOL’s decision to increase funding allocation to the aforementioned divisions, but not for the Office of Labor Management Standards (OLMS), which administers and enforces most provisions of the Labor-Management Reporting and Disclosure Act (LMRDA). According to Solis, the OLMS will receive the same level of funding, but will be “more strategic” in carrying out its job functions. Solis clamed that in 2010, it conducted more investigations (145) and issued more indictments than it had in recent years.
In response to questions about “card check” and the Employee Free Choice Act (EFCA), Solis said that her agency did not have the authority to implement provisions of this failed bill administratively or through regulations, and acknowledged that it lacked sufficient votes to advance at this time.
A number of members were also critical of the administration’s position in favor of project labor agreements (PLAs), and its withdrawal of the union reporting LM-2 form. In response, Solis claimed that the use of PLAs reduces costs and uncertainty, and the LM-2 form was “duplicative in nature.”
Committee member Judy Biggert (R-IL) raised concerns about a possible conflict of authority between the EBSA and the SEC over a proposed rule that will amend who is to be considered a “fiduciary” under ERISA. Biggert noted that the SEC is in the process of developing regulations under the new financial reform law commonly known as the Dodd-Frank Act, and wondered if the DOL is coordinating efforts with that agency. Solis said that Assistant Secretary of Labor for the EBSA, Phyllis Borzi, has, indeed, been having discussions with the SEC on this issue.
In defending the budget request’s impact on jobs, Solis claimed that the health care industry experienced the largest job growth within the past year, and will continue to expand. She also said that should the Republican budget be implemented instead, the agency would have to make many cuts, including the elimination of many of the nearly 300 new wage and hour investigators it hired within the past two years. Rep. George Miller (D-CA) also noted that the Republican’s budget would reduce OSHA’s staffing to a level last seen in 1974. Also with respect to OSHA, Solis claimed that the DOL would continue to fund the Voluntary Protection Program (VPP).
The House is currently debating a continuing resolution to provide federal funding for the remainder of fiscal year 2011.