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Judge Kills the Last Trump H-1B Visa Rule Left Standing

International students will have an easier time obtaining H-1B status after a federal judge ended a Trump administration regulation that made the process more difficult.

According to this Forbes article, Trump administration officials increased H-1B denial rates via memos and policies that were later ruled unlawful. McDermott Partner Paul Hughes—who represented plaintiffs in an complaint for declaratory and injunctive relief—said a Trump administration move to end H-1B via lottery violated the law.

Read more here.




Labor and Employment Policy to Watch in 2021’s Second Half

As US Congressional Democrats continue their advocacy for a pro-worker agenda, multiple bills and rules could bring about sweeping changes to the civil rights and labor protections for millions of workers. These include:

  • The Equality Act
  • The Protecting Older Workers Against Discrimination Act
  • The Pregnant Workers Fairness Act
  • The Protecting the Right to Organize Act (PRO Act)
  • The US Department of Labor’s Overtime Rule

According to McDermott partner Ellen Bronchetti, the PRO Act, for example, would enshrine a strict ABC test into federal law that would analyze whether workers qualify as independent contractors.

“I think that because Biden has promised to strengthen worker protections and strengthen workers’ right to organize, I think employers need to keep a real close eye on this legislation or versions of the legislation or pieces that might get pulled out and put elsewhere,” Bronchetti said in an article published in Law360.

Access the article.




Drug Prices Are Prime Target in Biden’s Competition Order

President Biden’s July 9, 2021, Executive Order—which seeks to increase competition throughout the American economy—takes aim at prescription drug prices. In this article, published in Law360, McDermott partner Emily Jane Cook says Biden’s focus on drug prices is unsurprising given the “significant public interest and frustration” with drug costs.

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Hurry Up and Wait: Department of Labor Delays Implementation of New Worker Classification Regulations

Businesses strive to draw the line correctly on who is an employee versus who is an independent contractor. New regulations issued by the Department of Labor (DOL) in early January promised to help. See, 29 CFR §§795.100. But by late January, those regulations under the Fair Labor Standards Act (FLSA) were frozen.

Unlike laws passed by Congress, administrative regulations are far more easily altered when a new president takes office. The regulations published by President Trump’s DOL in January had an effective date of March 8, 2021. Now, President Biden’s DOL will have an additional 60 days beyond that effective date to announce what will happen next.

Those new regulations provided a much simpler test for classifying workers. While including five factors, the results turned on two of those factors: (1) the nature and degree of the worker’s control over the work and (2) the worker’s opportunity for profit/loss based on personal initiative or investment. Most significantly, those regulations focused on the actual practices, rather than what may be possible.

This same issue may also arise under other federal statutes as well as state laws, including those governing on whom unemployment insurance taxes must be paid. With multiple statutes (each with its own distinctive test), drawing the line between independent contractors and employees correctly turns not only on meeting whatever the ultimate FLSA test turns out to be.

The most difficult is the so-called ABC test:

  1. The worker is free from the control and direction of the hiring entity in connection with the work’s performance, both under the contract for the performance of the work and in fact.
  2. The worker performs work that is outside the usual course of the hiring entity’s business.
  3. The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed.

That is the test that is embedded in proposed federal legislation: the Protecting the Right to Organize (PRO) Act. That is also now the official test for most jobs under most California laws.




A Momentary Victory for the ACA: Federal Judge Issues a Nationwide Injunction against Trump Administration’s Contraceptive Coverage Carve Outs

On January 14, 2019, US District Judge Wendy Beetlestone in the US District Court for the Eastern District of Pennsylvania issued a nationwide preliminary injunction blocking the Trump administration’s carveouts to the Affordable Care Act’s (ACA) contraceptive coverage mandate. One day prior, US District Judge Haywood Gilliam in the US District Court for the Northern District of California issued a more limited injunction blocking the same carve outs from taking effect in 13 states plus the District of Columbia.

On October 6, 2017, the Trump administration issued rules that are the subject of these two decisions. The rules would have allowed employers to raise religious and moral objections to avoid the ACA’s requirement that contraceptive coverage be provided without cost sharing under their group health plans. Under the ACA, certain contraceptive products and services are included in the list of preventive services that must be covered by most group health plans without cost sharing. The available exemptions to this rule were limited.

Judge Beetlestone reasoned that the loss of contraceptive coverage would have resulted in “significant” and “proprietary harm” to the states by causing increased use of state-funded contraceptive services, along with increased costs associated with unintended pregnancies. Without the preliminary injunction, the Trump administration’s rules would have gone into effect on January 14, 2019. The preliminary injunction does not permanently block the rules, but rather it stops the rules from going into effect while legal challenges are being pursued. Judge Beetlestone indicated that she is likely to invalidate the rules, stating that the US Departments of Health and Human Services, Labor and Treasury exceeded the scope of their authority under the ACA by issuing the carve outs.

Charnae Supplee, a law clerk in the Firm’s Washington, DC office, also contributed to this post. 




US Immigration under the Trump Administration: What We Know and What We Think We Know

President Donald J. Trump recently issued an Executive Order, followed by a proposed bill and other guidance, which would drastically change the current immigration system. Based on these developments, employers should be prepared for immigration hiring changes and may want to consider applying now for immigrant status for affected key employees.

Continue reading.




CMS Aims to Stabilize Exchanges but Does Not Address Issuers’ Biggest Questions

CMS recently released a final rule with the goal of stabilizing Exchange markets for 2018. The agency also issued several significant guidance documents where CMS extended the deadlines for 2018 rate and Exchange qualified health plan application submissions, adopted a good faith compliance standard for 2018 and delegated additional plan certification responsibilities to states. While these steps may provide some comfort for issuers, the agency did not address the most significant areas of issuer concern when it comes to 2018 Exchange participation. Namely, the Final Rule and guidance documents do not resolve ongoing uncertainty regarding cost-sharing reduction funding, the enforcement of the individual mandate or ongoing efforts to repeal the Affordable Care Act.

Read the full article.




View From McDermott: Employee Benefit Plan Considerations for Health Systems in 2017

Amy Gordon, Jeffrey Holdvogt, Susan Nash and Mary Samsa wrote this bylined article on health system employee benefit opportunities and challenges in 2017. The authors urged health systems to review internal controls for 403(b) plan compliance and new design opportunities for 457(f) plans, to review their short- and long-term health plan operation in light of any Affordable Care Act replacement.

Read the full article.




Proposed Regulations Update Mortality Tables, Minimum Present Value Requirements for Defined Pension Plans

Near the end of 2016, the Department of Treasury (Treasury) and the Internal Revenue Service (IRS) published two significant sets of proposed regulations on issues pertaining to defined benefit pension plans, including mortality table updates that likely would increase pension funding liabilities for many plan sponsors.

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