CONSTRUCTION
LOOKING AHEAD TO 2025
MORE OF 2024 IN REVIEW
2024 PREDICTIONS RECAP
NLRB Lowered the Bar for Construction Industry Unionization The Labor Board issued a new regulation in July that not only scrapped three Trump-era rules that had made it easier for workers to undo union representation but also reinstated a prior doctrine shielding voluntarily recognized unions from prompt decertification, once again easing the way for union recognition in the construction sector. California Extended the PAGA Exemption for Certain Construction Employers Governor Newsom signed legislation in September that will ensure certain unionized construction employers are completely exempted from PAGA lawsuits for the next 14 years. As a result, construction employers that meet certain standards – including paying workers 30% more than minimum wage – will see the Private Attorneys General Act (PAGA) exemption they have enjoyed for past decade pushed out to January 1, 2038. OFCCP Announced New Compliance Filings The Office of Federal Contract Compliance Programs announced in November that it is reinstating a monthly compliance filing report for covered construction contractors and subcontractors. With an initial due date of April 15, 2025, and reports due every 15th of the month thereafter, covered construction contractors and subcontractors will soon have to submit their CC-257 reports to the OFCCP.
Construction Employers Will Challenge More Agency Actions in Court The Supreme Court’s demolition of the decades-old Chevron doctrine in June gives construction employers a new toolset to push back against regulatory actions taken by federal agencies such as the DOL, OSHA, MSHA, and the Environmental Protection Agency. Construction employers and their advocates will be in a better position to challenge overly burdensome regulations – such as OSHA’s proposed national heat safety rule if it is finalized next year. Relaxed Regulatory Environment – But a Mixed Bag on Construction Costs Once Donald Trump returns to the White House, a relaxed regulatory environment will return to the construction industry, including streamlined climate and environmental regulations, which will cut red tape and fast track construction activity. While we anticipate a reduction in the costs of domestic construction materials, President Trump’s promised new tariffs and increases on existing tariffs on foreign goods will result in increased costs of construction materials such as solar panels and steel. Labor Shortages and Hiring Skilled Workers The president-elect’s plan for heightened immigration enforcement ensures ongoing challenges with labor shortages and hiring skilled workers. Increased ICE raids will impact business operations and lead to public relations issues – particularly because the construction industry often employs higher concentrations of undocumented workers. We’ve put together five steps you can take to safeguard your operations against the anticipated enforcement. Federal Infrastructure Will Remain a Priority While Other Biden Initiatives Will Be Left Behind The incoming Trump administration will continue to prioritize federal infrastructure, with an emphasis on domestic preference policies such as highway expansion. However, we will likely see a shift away from public transportation, high-speed rail, urban transit, and green initiatives.
DOL Compliance Actions Slightly Decreased, But the Agency Still Brought the Heat While the construction industry saw a slight decrease in DOL compliance actions in FY 2024 (1,966 compared to 2,134 in FY 2023), it remained in the top three of all industries facing the most enforcement activity – and the agency brought the heat, just as we predicted, in other ways. Federal rules issued in January and April made it harder for businesses to classify workers as independent contractors under federal wage and hour rules and made millions of additional workers eligible for overtime pay (but see the Wage and Hour section to see where the overtime rule stands). Labor Activity Remained High This year saw another uptick in labor organizing activities across all industries, just as we predicted. In fact, the National Labor Relations Board reported in October that it received 2,593 petitions during FY 2024 – up 27% from the prior fiscal year (and more than double the number of petitions received in FY 2021).
HOW’D WE DO ON OUR PREDICTIONS? We got the predictions RIGHT
Tami Essis Culkar
Collin D. Cook
Denver Of Counsel and Co-Chair, Construction Industry Team tculkar@fisherphillips.com
San Francisco/Irvine Partner and Co-Chair, Construction Industry Team ccook@fisherphillips.com
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