2021 Workplace Changes Under the Biden Administration

After 4 years of a conservative president and Republican majority in Congress, we can expect to see big changes to American life under the Biden-Harris administration. Armed with the support of a Democratically controlled congress, President Joe Biden and allies have a chance to move forward with sweeping legislative changes that support their more-progressive agenda. One area which is sure to experience major shifts is the workplace. While former President Donald Trump pulled worker safety protections, rolled back Obama-era protections for women workers, and sharply limited worker visas, President Biden’s administration is looking to overhaul labor law, provide a pathway to citizenship for undocumented individuals, and raise the federal minimum wage, among other initiatives.

Here are some workplace changes that may be coming under the Biden-Harris Administration.

1. Passage of The PRO ACT

The Protecting the Right to Organize (PRO) Act is a labor rights bill that aims to protect employees’ rights to organize. Many see it as essentially a union bill. If passed, the PRO Act would be overseen by the National Labor Relations Board (NLRB), and “It would represent the biggest change to labor law since the passage of the National Labors Relations Act in 1935,” said labor and employment attorney Michael Elkins.

Elkins highlights some of the biggest changes the bill would make if passed into law:

• “Prohibit mandatory arbitration agreements in employment contracts (This is huge, and a tremendous disadvantage for employers).
• In conjunction with the above, it would reverse the United States Supreme Court’s Epic System’s decision which held that mandatory arbitration agreements were enforceable.
• Impose stricter requirements for employers to classify a worker as an independent contractor versus an employee.
• Create a private cause of action for unfair labor practices (Currently only the NLRB can address these issues, under which PRO individuals would be able to sue).
• Create new civil penalties and personal liability for labor law violations.

Janine Yancey, CEO and Founder of Emtrain, an online HR, compliance, and harassment training company, said it’s unsurprising a labor-right act such as the PRO Act is top of mind for this administration.

“We know from 100 years ago that when new business models are created, there is often a period of regulated activity that leads to worker abuses, followed by workers organizing to demand fairness and safety in working conditions,” Yancey said.

As it turns out, we’ve already entered this second phase where workers have begun organizing, and our modern era, in large part by harnessing the internet. “I believe the new legislation will accelerate what we’re already starting to see: the modern age of workers organizing to get a seat at the table and participate in the decision-making of the enterprise,” Yancey added.

“I believe the new legislation will accelerate what we’re already starting to see: the modern age of workers organizing to get a seat at the table and participate in the decision-making of the enterprise.”

2. Major immigration reform

President Trump rejected new applications for the Obama-era program Deferred Action for Childhood Arrivals (DACA), a program that provided a 2-year period of deferred action from deportation and granted a work permit, among other protections, and temporarily suspended a variety of work visas in his attempt to limit immigration. For a country that relies on the labor of close to 1 million temporary foreign workers and nearly 8 million undocumented individuals, Trump’s policies on immigration created less stable workforces for many businesses, big and small. While it’s still unclear exactly how much of President Biden and the Democratic party’s agenda will be passed into law, the current administration’s more open stance on immigration is sure to affect business in a big way.

Pathway to citizenship

The Biden-Harris Administration’s proposed immigration reform, The U.S. Citizenship Act of 2021, offers an 8-year path to citizenship for the majority of the U.S.’ 11 million undocumented individuals, among extending other rights and protections to those seeking citizenship. If passed, business owners could have access to a more reliable pool of workers. “Creating a path to citizenship creates a greater and more stable workforce for small businesses who often struggle to find labor,” said Elkins.

Decrease in ICE raids

Jessica Bombadilla, Immigration lawyer and founding attorney of the Law Office of Jessica Bombadilla, said yes, small businesses will have a more secure workforce thanks to the path to permanent residence or citizenship that the proposed legislation offers, but there will be other changes, too. “Workplace raids and excessive enforcement by Immigration and Customs Enforcement (ICE) — also a major concern to businesses — also appear to be a thing of the past,” said Bombadilla. She noted that in a memo to ICE in February 2021, the Biden-Harris administration directed the agency to limit their focus to only 3 classes of foreign nationals, including those who have crossed the border after November 2020 or those who pose significant security threats.

3. Returned protections for diversity, equity, and inclusion

On his first day in office, President Biden reversed Executive Order 13950, “Combating Race and Sex Stereotyping,” signed into order by President Trump. This executive order forbade diversity-inclusion education in federal agencies, U.S. military institutions, federally-contracted companies, and for federal grant recipients. In doing so, “the administration prevented the primary and necessary tool that helps drive awareness and practices that create more inclusive and accessible workplaces,” said Dr. Theresa Haskins, President of Haskins Consulting Group, a neurodiversity inclusion and leadership development consulting firm.

“A company’s unilateral decision to enforce DEI policies regarding bias/systemic racism is an employee’s only protection while at work.”

In order to win a discrimination case, one must prove intent — something nearly impossible with unconscious bias and systemic racism — leaving these issues largely unprotected under federal law. “Because they’re not [protected under federal law], it’s important that diversity, equity, and inclusion (DEI) training be allowed on these issues and also that companies enforce these DEI policies in the workplace,” said Andrew Lacy, Esq., founding Attorney of The Lacy Employment Law Firm, a labor rights and employment firm. “A company’s unilateral decision to enforce DEI policies regarding bias/systemic racism is an employee’s only protection while at work,” he said.

Demetria Miles-McDonald, Founder and CEO of Decide Diversity, a full-service diversity, equity, and inclusion firm says the repeal of Trump executive order is more about a rebuttal of the previous president’s value system, rather than a significant promoter of DEI in the workplace.

“Organizations committed to this work embed DEI into every decision. It’s top of mind and not influenced by an executive order,” she said. “Being committed means you aren’t easily swayed one way or another.”

4. Raising the federal minimum wage

On Thursday, February 25, proponents of raising the minimum wage to $15 per hour by 2025 suffered a loss when Senate Parliamentarian Elizabeth MacDonough ruled the provision could not be part of the COVID-19 relief package making its way through congress. Even so, Biden campaigned hard on this promise, and it’s likely he will work with the Democratic-controlled Congress to find other ways to accomplish the increase.

While raising the minimum wage was disallowed in the current relief package as it will be passed through reconciliation — requiring only a simple majority vote and bypassing the potential for filibuster altogether — senate rules say it can be considered as a standalone bill or as part of other legislation.

Non-livable wage

At $7.25, the federal minimum wage, dubbed by Senator Bernie Sanders of Vermont a “starvation wage,” has remained unchanged since 2009 even as the cost of living has continued to climb. The current disparity between cost of living and federal minimum wage is so vast that a minimum wage worker cannot afford rent of a 2-bedroom home in any U.S. state.

If and when Congress raises the federal minimum wage, it will happen incrementally. Critics say that small businesses will be hit hardest, while proponents say increased worker productivity that results from earning a living wage, plus the boost for the local economy resulting from minimum wage-workers earning more means small businesses will actually benefit.

Small business owner John Cascarano, President and Founder of Getbeast.com, a personal care and grooming business, said his business is behind raising the minimum wage. “Our company supports the increase. We want lonely team members who are well compensated and committed,” Cascarano said. “We have found increases in productivity and retention, and less inter-company division and have long paid over minimum wage.”

5. Push to limit independent contractor classification

In an attempt to regulate the gig economy, Democrats could make changes to the requirements a business or employee must meet in order for workers to be considered employees, and therefore protected under the Fair Labor Standards Act (FLSA), or independent contractors, who are not.

Provisions to worker-classification are currently included in the PRO Act, but it remains unclear if the PRO will emerge from both legislative houses unchanged. There’s much at stake as the differences between employees and independent contractors are stark. Employees are entitled to overtime pay, health insurance, collective bargaining power, and unemployment benefits, while independent contractors are not.

It’s possible that the factors used to determine a worker’s employee or non-employee status will resemble California’s ABC test which went into effect when California residents passed Assembly Bill AB5, which was later amended by Prop 22. According to employment attorney and founder of legaladvice.com, David Reischer, these may include:

• Does the person work from the main office
• Resources supplied to employee/independent contractor, and
• The direct delegation of tasks by the business

How this changes the workplace

In a word, businesses will have to be much more careful in order to accurately designate employees. “Businesses will no longer have the ability to lean on federal assistance for paying back pay,” said Cena Martin Chandler, Employee Engagement Specialist and Team Operations Specialist at Cena Martin Global Consulting. “This means they’ll have to take extra precautions in the areas of employment and add additional measures when hiring out independent contractors for work.”

What it would mean for independent contractors

Independent contractors will need to draw clear lines around the role they play for an organization as well as taking additional measures to protect themselves from dispute. “Independent contractors need to make sure they have their legal structures in place, whether LLC or another form,” Martin Chandler said. “It also means they should have strong invoicing and timesheet management systems in place,” she added.

Expect change

Lacking the deep pockets and seemingly endless resources of big corporations, small business owners often worry they’ll be hit the hardest by legislative changes that affect the workplace. Economists and workplace policy experts on both sides of the aisle argue their plans and proposals are the most sensible for the American people and economy. While the most productive policy changes depend on who you ask, we do know to expect change. Democrats haven’t held control of the White House and Congress since 2011, and with mid-term elections in 2022, the blue party has only 2 guaranteed years in power. That means they’ll work swiftly to move through their more progressive legislation, advancing their agenda on labor rights, immigration, federal minimum wage, and more.