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TWENTY SECONDS ON THE CLOCK…

The Biden administration released its first Unified Agenda of Federal Regulatory and Deregulatory Actions.  In total, the Agenda contains nearly 4,000 rules and regulations, in varying stages of the regulatory pipeline, from more than 72 federal departments, agencies, and commissions.  This week, we take a look at a few industry-related measures that are expected to play or pass. 

WHAT % OF A SHIFT IS TIP-PRODUCING?

With over 70 items on the docket, the U.S. Department of Labor (DOL) intends to overhaul a number of regulations, including the treatment of employee “tips.”  The DOL released a proposed rule that would prohibit businesses from paying workers the $2.13 tipped minimum wage for “non-tipped” tasks. The proposal would allow restaurants and other businesses to only pay the tipped minimum wage for tasks that "directly support tip-producing work, provided the directly supporting work is not performed for a substantial amount of time." The Wage and Hour Division (WHD) of DOL estimates that “substantial work” will be defined as more than 30 consecutive minutes or 20% of the hours an employee works in a given week.

TELL ME A COMMON SIDE-EFFECT OF PFAS.

The Environmental Protection Agency (EPA) announced a slate of actions aimed at toxic chemicals called Per- and polyfluoroalkyl substances (PFAS).  The agency additionally proposed a reporting requirement would require all manufacturers (including importers) of PFAS in any year since 2011 to report information related to chemical identity, volumes manufactured and processed, byproducts, environmental and health effects, worker exposure, and disposal.  PFAS chemicals have been linked to health issues including cancer and immune system problems. They can be found in a variety of household goods and drinking water. 

NAME A PREMIUM CIGAR BRAND.

The U.S. Food and Drug Administration (FDA) withdrew its proposed rules related to premium cigars. The FDA will instead wait for the results of an ongoing study before providing information on potential regulations related to premium cigars. The FDA contracted with the National Academies of Sciences, Engineering and Medicine (NASEM) to conduct a comprehensive assessment and review of the scientific literature on premium cigars and provide a final report of the study results. The research is due in the spring of 2022.

HOW MUCH CAN A WHISTLEBLOWER RECOVER?

The National Highway Traffic Safety Administration (NHTSA) launched a new website to enable employees or contractors of a motor vehicle manufacturer, part supplier, or dealership to provide whistleblower information to the agency. The new information page helps whistleblowers determine what information they should provide and provides instructions on proper reporting. NHTSA hopes this new service will encourage whistleblowers to report potential vehicle safety defects, noncompliance with the Federal Motor Vehicle Safety Standards, and violations of the Vehicle Safety Act.  Whistleblowers who provide information that leads to regulatory enforcement actions can generally expect to between 10% and 30% of sanctions over $1 million.

NAME A TYPE OF COIN.

The agenda for the Securities and Exchange Commission (SEC) will include disclosures relating to climate risk, corporate board diversity, beneficial ownership, and swaps. The SEC will also focus on rules relating to Special Purpose Acquisition Companies (SPAC) and short sale disclosure reform.  Despite these intended regulatory areas, analysts point to a set of regulations not included on the SEC agenda—bitcoin and cryptocurrency.  That said, SEC Chairman Gary Gensler has indicated his intent to address these topics and the need to protect investors and regulate cryptocurrency exchanges, so we’ll have to watch for the next regulatory agenda for an update. 

Let's Go to the Judges

NINE

The U.S. Supreme Court unanimously ruled (9-0) in favor of college athletes seeking unlimited benefits tied to education. The suit, NCAA v. Alston, was brought by a group of athletes led by a former West Virginia running back who contended the NCAA had violated antitrust laws by capping the amount of compensation they could receive as part of their scholarships. Currently, scholarships only include tuition, room, board, and cost of attendance.  Justice Brett Kavanaugh’s concurring opinion said, "Nowhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate. And under ordinary principles of antitrust law, it is not evident why college sports should be any different.”  The ruling is prompting swift action by the NCAA.

TO NIL

In response to the ruling, the NCAA is attempting to produce Name, Image, and Likeness (NIL) rules before June 28.  There is urgency because NIL laws in six states (Alabama, Florida, Georgia, Mississippi, New Mexico and Texas) are set to begin July 1.  Senator Maria Cantwell (D-WA), chair of the U.S. Senate Committee on Commerce and the author of a federal NIL bill, said, "This decision gives new urgency to the bipartisan work we are doing to set a nationwide standard for student-athletes that gives them control of their Name, Image and Likeness (NIL) as well as providing additional health benefits and standards."  We’ve got our eyes on a new playing field.

Making Our Way Around the Country

COLORADO

Lawmakers in Denver passed SB21-190, the Colorado Privacy Act (CPA), making Colorado the third U.S. state to pass a comprehensive privacy law. This measure is a broad privacy law similar to California’s CCPA, and would apply to entities that produce products or services targeted to Colorado residents that either control or process personal data of more than 100,000 consumers per year: or sell personal data of at least 25,000 consumers.  The CPA would grant consumers various privacy rights including the right to opt-out of the processing of their personal data.  It would also provide consumers the right to access, correct, or delete their personal data, and the right to obtain a portable copy of their data.  If Governor Jared Polis (D-CO) signs the bill, the law would take effect on July 1, 2023. 

CONNECTICUT

The Connecticut General Assembly passed legislation to address the climate-related risks of insurers.  Under the bill, the Connecticut Insurance Commissioner would be required to incorporate emissions reduction targets into its supervision and regulation of Connecticut insurers. This includes addressing the impact of thermal coal, tar sands and Arctic oil and gas, and taking regulatory and supervisory actions to bolster the resilience of insurers to the physical impacts of climate change. The legislation requires the insurance commissioner to submit a report to the joint standing committee of the General Assembly not later than April 1, 2022. The report must include its progress in integrating such risks into risk-based capital requirements, regular supervisory examinations, and risk and solvency assessments. The bill next goes to Governor Ned Lamont (D-CT) for signature.

NEW YORK     

The New York Assembly passed legislation that would change the ways attorneys are paid in workers’ compensation claims.  The changes are tied to the outcome of a claim. For example, attorneys who secure awards for increase in compensation for temporary, total, or partial disability are entitled to 15% of the increased compensation. The legislation would also change attorney’s fees for awards pertaining to specific loss of use findings or to permanent facial disfigurement. If signed into law, the legislation would take effect immediately.

GOOD ANSWER. GOOD ANSWER.

Back to our main story this week, we value the results of an effective survey.  As we discussed last week, The Way is going on hiatus after next week’s edition.  We are going to use the Summer Recess to evaluate our process and find new ways to better serve you!  To help us, we have prepared a brief survey, which you can access here.  Thank you for your feedback.  We will use this information to make continuous improvements to The Way.  In the meantime, stay safe, stay well, and stay connected.