Employers beware: President Obama’s recent budget proposal may portend a Department of Labor crackdown on workplace pay issues in 2015.
As part of the 2015 fiscal year budget which President Obama submitted to Congress last week (available here), the administration requested an $11.8 billion contribution to the Department of Labor’s discretionary funding as well as new, dedicated mandatory funds. The proposed funds include a $41 million increase from the amount requested for fiscal year 2014 for the Department’s Wage and Hour Division.
This windfall would go toward funding the Division’s efforts to enforce wage and hour, employee misclassification, whistleblower and employment safety laws, and would allow the Division to hire up to 300 new investigators.
As compared to previous budgets, the President’s proposed increase in funding for the Department in fiscal year 2015 is unusually large. While there’s little chance that the funding increase will make it through the appropriations process in its entirety, the very nature of the request itself sends a message to employers. The fact that President Obama would attempt to obtain such a large increase in funding for the Division signals that wage and hour issues will be a point of great focus for the administration in the coming years.
Employers would be wise to identify and address any vulnerabilities they may have in advance of increased pressure from the Division in coming years, including taking steps to ensure that their employees have been classified properly. Regardless of whether the appropriations process slashes a significant portion of President Obama’s requested budget increase or not, the writing is on the wall: this administration is committed to the aggressive enforcement of workplace laws, and employers should be ready if the Division comes knocking.