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One View ‘A Radical Rewrite’ of U.S. Employment Law

August 6, 2009
Randel Johnson, senior vice president of labor, immigration and employee benefits at the U.S. Chamber of Commerce in Washington, testifies several times a year before the Senate, most recently to voice opposition to proposed health care legislation that would require nearly all employers to provide some level of coverage to their employees.

“There’s a whole lot of employment laws pending on Capitol Hill,” Johnson says. “It may take six to seven months to get to the enforcement level, but it will get there. So pay attention. Change is coming.”

Here’s what else he had to say:

Crain’s Chicago Business: Why the big emphasis on labor law?

Randel Johnson: When the Democrats came back into power, we knew there was a change in philosophy from the previous administration and we expected they would revisit employer regulations. But even I’ve been shocked at the massive number of bills and what lies ahead, and it’s only a few months into the presidency. It’s a radical rewrite of American employee laws.

CCB: Why now, in the midst of a recession?

Johnson: It’s the wrong time to impose new mandates on employers, just as they’re digging out of a recession. But others would say the flip side is that this is when workers need additional rights. But it’s tough [for businesses] across the board.

CCB: And why so much change all at once?

Johnson: My view of these things is that Congress tends to look at each individual bill and doesn’t always look at the cumulative effect on businesses. It’s wrong to look at these things in isolation, which is what too often happens.

CCB: What would you support?

Johnson: I’d support federal regulations only when it’s been demonstrated there is a clear need, or when it’s written to eliminate any adverse impact on employment.

CCB: When do you expect movement on some of the pending legislation?

Johnson: Everything is jammed up behind the Employee Free Choice Act, and it will remain pending until EFCA is resolved or taken off the table.

CCB: What about smal1-business owners who don’t have the resources to ensure compliance?

Johnson: There are many business owners, especially small-business owners, who are overwhelmed by new regulations. You can whistle by the graveyard and hope you don’t get caught, but now there is a greater exposure to liability. For example, under civil rights laws today, the amount of damages [for infractions] are tiered based on the size of the business. But pending civil rights legislation would blow the caps off. So even small businesses would be exposed to large damage awards. And new OSHA legislation expands the penalties for all sizes of businesses.

CCB: What changes should employers expect in health care?

Johnson: It’s very likely that Congress will require employers to provide health insurance of some type to their employees or pay civil fines. It’s not clear how it will shake out, but I believe very small businesses will have a difficult time carving out the resources to provide coverage. I’ve testified against it because not all employers can afford to provide health insurance and not all can provide the level that’s required in the bill (as it’s written today). It’s a huge issue to the business community, particularly small businesses, which because of their size provide fewer benefits to employees.

CCB: Beyond legislation, what else is coming?

Johnson: Business owners should look for new regulations on ergonomics and more aggressive enforcement of the OSHA general duty clause that requires employers to provide a safe workplace. Look for more aggressive enforcement of overtime laws. And we are closely watching the effort of enforcement agencies to narrow the definition of who is an independent contractor. It’s not yet legislation, but believe me, it’s coming. Overtime and payroll taxes, in particular, will be areas of huge exposure.