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The Legislative Report blog provides timely information on federal and state legislation and regulations and state trends as well as the myriad issues affecting the private club industry. A companion to CMAA's Legislative website, this resource should be your first stop for any information regarding legal, tax or legislative club-specific issues.

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H-2B Visa Cap Met for First Half of FY2017

(Dept of Labor, Immigration) Permanent link

H-2B Visa Cap Met

On January 10, US Citizenship and Immigration Services (USCIS) announced that the H-2B visa cap for the first half of the 2017 fiscal year had been reached. Currently, the H-2B visa cap set by Congress is 66,000 per fiscal year, with 33,000 to be allocated for employment beginning in the first half of the fiscal year (October 1 - March 31) and 33,000 to be allocated for employment beginning in the second half of the fiscal year (April 1 - September 30). Any unused visas from the first half of the fiscal year will be made available for use by employers seeking to hire H-2B workers during the second half of the fiscal year. However, there is no carry over to the next fiscal year.

This announcement does not impact any H-2B worker petitions received by the USCIS prior to January 10 or any employees with a start date of April 1, 2017, or later. As well, USCIS will continue to accept H-2B petitions that are exempt from the congressionally mandated cap including current H-2B workers who are petitioning to extend their stays and, if applicable, change the terms of their employment or change their employers.

In FY2016, Congress had enacted the returning worker provision which exempted H-2B visa workers who had previously used the program to be exempt from the cap. However, Congress opted not to extend this provision for FY2017.

Regulations Under the Microscope

(Regulation) Permanent link

Microscope

It is a new session of Congress and a new Presidential administration. What does that mean for the major issues affecting the club industry? Here’s a brief overview of what we might expect to see during the transition on three of the industry’s top federal issues.

The Affordable Care Act – Both Congressional leadership and the President have indicated plans to repeal this legislation through Congress. Work has already begun to pass the repeal through budget reconciliation, which is a method that allows fast-track consideration without the threat of filibuster. The good news is that some of the popular provisions, like elimination of lifetime limits, pre-existing conditions and keeping minors on parental insurance until age 26, may be spared. Many of the least popular provisions and those most troublesome for small businesses and individuals, the individual penalties and employer mandate, are definitely on the chopping block.

The wildcard to this issue is that Congressional leadership has been unable to agree on what the replacement will be. Expect this process to be lengthy and complicated. While Congressional leadership has indicated their goal is to have legislation on the President’s desk for his signature by February, the reconciliation process could be longer.

Overtime Rule Changes and DOL Regulations
– A temporary nationwide injunction remains in effect based on the November action of the US District Court. The nomination of Andrew Puzder, a restaurant industry executive, has illustrated the Trump Administration’s interest in a more business-friendly era of regulation from the Department of Labor. Apart from the overtime rules, it is expected that the Administration will thoroughly review much of the recently enacted DOL and OSHA regulations recordkeeping, the Fiduciary Rule and others.

Congress can vote to repeal regulations, which would have immediate effect. Without that action, the Administration is bound by the rulemaking process which takes time so it is not an immediate end to a regulation. However, cabinet secretaries, like Puzder, can lessen the effect through diminished enforcement.

The wildcard here is the continuing battle in the courts on overtime. While the Trump Administration may choose to withdraw defense of the rule, other groups have already petitioned to take over defense if that happens. It remains unlikely that these efforts will be successful but does create uncertainty for small businesses.

Waters of the US
– This is another measure which remains on a nationwide injunction, enacted by the US Circuit of Appeals Sixth Circuit in October 2015. Congress has already begun working on this repeal. On January 12, Senators Deb Fischer (R-NE) and Joni Ernst (R-IA) introduced S.Res.12 which calls for the withdrawal of the Waters of the US (WOTUS) rule.

The Trump Administration has nominated Scott Pruitt, Attorney General of Oklahoma, to lead the Environmental Protection Agency. Pruitt, as Attorney General of Oklahoma, was involved in litigation against the EPA and WOTUS, citing its executive overreach.

Like overtime, the wildcard here is the continuing battle in the courts. The Administration may choose to withdraw legal defense of the rule as well.

In summary, it is going to be a busy 115th Session of Congress and for the 15 cabinet agencies as they review many of the regulatory actions of the previous administration.

Stay tuned for the latest information.

OSHA Clarifies Employer’s Recordkeeping Obligations in New Rule

(OSHA) Permanent link

On Monday, December 19, the Occupational Safety and Health Administration (OSHA) issued a final rule designed to clarify an employer's continuing obligation to make and maintain an accurate record of each recordable injury and illness. The final rule does not add any new compliance obligations for employers or change any existing reporting requirements. The final rule is slated to become effective January 18, 2017.

OSHA has long held the position that an employer’s duty to record an injury or illness continues for the full five-year required record-retention period, and this position has been upheld by the Occupational Safety and Health Review Commission in cases dating back to 1993. This final rule comes in opposition to litigation dating from 2012 which reversed the Commission’s findings.


So what does this mean for a club? Generally, workplace violations are subject to citations and penalties for up to six months after the last instance of employee exposure to the unsafe condition. However, through this rule, OSHA is deeming failure to report the issue as an ongoing violation and thus employers could be fined up to five years from the date of the unreported injury or illness. In essence, OSHA is extending the statute of limitations from six months to five years.


For example, a worker suffers an injury at the club on January 1, 2017, while working in the kitchen that requires medical attention. The club fails to report it to OSHA and record it on OSHA 300 log. Under the new rule, the club could be fined and cited through January 1, 2022, for this omission and the unsafe conditions (if they existed). Previously, the club could have only been cited until July 1, 2017.


Given the ongoing Presidential transition, this rule could be reviewed by the incoming Administration as well as the new Congress when they return in January. Due to the timing of its issuance, it would be subject to the Congressional Review Act.  


Keep Your Employees Safe This Winter

(OSHA) Permanent link

Cold weather came early this year and many parts of the country have already experienced snow, ice and freezing rain. Despite the outside conditions, many club employees have to get their jobs done. Take time to remind your employees about cold weather hazards. Working in cold weather can be just as dangerous as working in excessively warm weather.  


Use these OSHA training resources to keep your employees safe this winter:



Share these resources with supervisors and employees at your club!


Congress Allows H-2B Visa Returning Worker Exemption to Expire

(Congress, Immigration, Regulation) Permanent link

Waitstaff


On Friday, December 9, Congress passed its second continuing resolution of the year, extending short-term government funding through April 28, 2017. Unfortunately, for clubs who currently use H-2B visa workers, Congress did not include what is known as the “returning worker” provision.
  
This provision would continue to have exempted H-2B workers identified as “returning workers” from the annual H-2B cap of 66,000 visas. A “returning worker” is defined as an H-2B worker who was previously counted against the annual H-2B cap of 66,000 visas during the previous three fiscal years.
  
The provision was last enacted as part of the FY2016 budget deal in December 2015.
  
In previous years, when the returning worker provision was not in effect, the annual cap was routinely met, which prevented further applications being approved and leaving many seasonal businesses, like clubs, without sufficient workforces. Over the course of 2016, the program also suffered from significant processing delays, again hampering the businesses that rely on the program.
  
When Congress returns in January, they will begin working on the full FY2017 budget.

Court Blocks Overtime Rule From Becoming Effective December 1

 Permanent link

On Tuesday, November 22, United States District Judge Amos Mazzant of the United States District Court for the Eastern District of Texas issued a temporary nationwide injunction halting the Department of Labor’s (DOL) overtime rule from becoming effective December 1. The final overtime rule was released by the Department of Labor in May 2016.

In his 20 page ruling, he stated “the Department’s salary level under the Final Rule and the automatic updating mechanism are without statutory authority. The Court concludes that the governing statute for the EAP exemption, 29 U.S.C. § 213(a)(1), is plain and unambiguous and no deference is owed to the Department regarding its interpretation.”

In September, two separate legal challenges were filed against the DOL’s overtime rules. In the first challenge, 21 states have joined together to object to the rule, based on its impact on state funds and budgets. In a separate action, the US Chamber of Commerce and more than 50 other national and Texas business groups challenged the rule for violating the Administrative Procedure Act. These cases were consolidated for consideration by Judge Mazzant.

This injunction is temporary and suspends the overtime regulations until Judge Mazzant can issue a complete ruling on the full merits of the case. However, it is likely that this means the end for this regulation as legal consideration will extend into the next Presidential Administration. The incoming Trump Administration has already indicated that it plans to roll back many of the onerous regulations issued by the DOL under the Obama Administration. It can withdraw defense of this case by the DOL, which would effectively end the regulation. It also gives time for Congress to act legislatively to remedy the measure as well.


Stay tuned!

Court Strikes Down Persuader Rule

(Dept of Labor) Permanent link

Court Strikes Down Persuader Rule - Gavel

On Wednesday, November 16, the US District Court for the Northern District of Texas struck down the Department of Labor’s Persuader rule, extending a preliminary nationwide injunction that was previously issued on June 27.

The final Persuader Rule was released by the Department of Labor in March 2016 and requires full public disclosure on the use of labor relations consultants by employers. In short, the rule requires employers and their hired consultants to report when the consultants directly persuade workers or when the consultants in four “indirect” categories in relation to labor organization or disputes. The Persuader rule was first introduced in 2011, but has been on hold since 2014. The reporting requirements were slated to become effective July 1, 2016.

In his opinion, Judge Sam Cummings cited the irreparable harm that the rule would pose to the tenets of attorney-client privilege between an employer and their legal counsel and prevent employers from receiving effective representation by legal counsel.  

It is unlikely that this ruling would be appealed or revived under the incoming Trump administration.