New DOL Wage Regs Come As Court Challenges Still On Hold
Shivani Poddar, partner in Herrick's Litigation Department, was quoted in Law360 Employment Authority discussing the U.S. Department of Labor's ("DOL") Wage and Hour Division proposing new regulations involving independent contractors and joint employers, while court challenges to wage rules from the prior administration remain delayed.
The article notes that "as the DOL proceeds with carrying out its regulatory agenda, including a proposed rule announced April 22 for analyzing when multiple entities are jointly liable for wage law violations, the agency has sought to delay litigation stemming from former President Joe Biden's administration. Those cases have been stayed for many months, even those centered on issues that don't appear on the current administration's regulatory agenda."
As those cases play out, there is uncertainty for employers, said Shivani.
"The fact that these cases are stalled and the DOL is not really enforcing the rule, does that mean that there's a new rule that is superseding it?" she said.
But there is less uncertainty in states with stricter requirements than the federal government, she added.
In places such as California, New York and New Jersey, "it's basically background noise, what's happening on the federal level," she said.
It makes sense for plaintiffs to allow the DOL to put cases on ice, Shivani said.
"Why expend litigation funds and time on an issue which might ultimately be resolved by a new rule?" she said. "If it's not really impacting the employers in an adverse way, and if the employers believe that these will be reversed or vacated or changed, then there is no reason to continue litigating or continue spending funds on litigating something that might potentially be moot."
As for the DOL, the playbook seems to be, "nonenforcement, propose a new rule… extend the framework across multiple different statutory regimes and let the litigation moot itself," Shivani said.
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