Dive Brief:
- A federal hiring freeze may hinder the Department of Labor's ability to investigate wage and potential other DOL violations, according to Bloomberg BNA.
- Officials from the DOL's Wage and Hour Division said a large group of WHD employees (25%) are ready for retirement, but there is also the strong possibility that a number of supervisors and investigators will leave in response to a President Donald Trump administration. In either scenario, the agency would not be able to hire employees to fill any of those positions amid the freeze.
- Trump signed the hiring freeze on Jan. 23 and has publicly expressed a desire to shrink the size of the federal workforce.
Dive Insight:
The construction industry often has a strained relationship with the DOL and its Occupational Safety and Health division, as industry groups tend to come out against the department's new regulations. OSHA successfully overcame industry pushback and implemented a new silica rule in June, as well as a 78% hike in penalties in August.
Construction industry group's record of success has been slightly better against the DOL itself. Construction groups were successful in their efforts to have courts block two rules — the persuader rule and the new overtime regulation.
The DOL's Wage and Hour Division plays a crucial role in enforcing workplace regulations. When some contractors try to find ways to increase their profit margins on projects, they often turn to employee pay and benefits to create that cushion. Whether it's not failing employee benefits or insurance, skimping on wages or not paying workers at all, officials at all levels have ramped up their attention to these violations.
Misclassification is a significant problem in the construction industry, as a 2014 report from McClatchy Co found that employers often claimed that legitimate employees were independent contractors so they would not have to pay them payroll taxes, unemployment or workers' compensation.
