What might the labor and employment landscape look like in 2025 and beyond? Consistent with proposed policies and past actions of the first Trump administration, forthcoming changes by the Trump-Vance administration could include a shift toward employer-friendly policies across the DOL, rollbacks on pro-union NLRB stances, and a more critical approach to diversity initiatives by the EEOC and OFCCP, among others.
Policymakers could also take their opportunity to pause minimum wage and other compensation increases, tighten immigration policies, halt controversial OSHA rulemaking efforts, end noncompete restrictions, and move administrative agencies away from enforcement and toward compliance.
Consistent with past transitions, we expect significant changes—both near- and long-term—at the National Labor Relations Board (NLRB) in what likely will be a continuation of the now predictable policy oscillation between Republican- and Democratic-controlled Boards. It is anticipated that current General Counsel Jennifer Abruzzo will be removed from office as soon as the new administration is in place consistent with the new precedent established by the Biden administration four years ago.
Abruzzo advocated for expansive interpretations of the NLRA through a series of memoranda, all of which likely will be repealed. These include memoranda regarding noncompetes and stay-or-pay provisions and expanded financial remedies. With a new General Counsel, we could see a return to the Board’s more traditional enforcement approach, with a friendlier settlement environment, including rescinding requirements for full settlement remedies, imposition of extraordinary remedies (e.g., apology letters), and requiring default language.
It is likely that Marvin Kaplan, the Board’s lone Republican, will be designated NLRB Chairman, but how quickly the Biden Board’s pro-union precedent may begin to be rolled back will depend on many factors. These include whether current-Chairman Lauren McFerran is confirmed by the Senate before the end of this Congress and how quickly the Trump-appointed Board members are seated. There will be two NLRB Republican vacancies if McFerran does not rejoin the Board.
A newly constituted Republican-majority NLRB would likely roll back many of the pro-union policies of the Biden administration. This includes the new policies that make it easier for unions to organize, such as the new Cemex framework that allows unions to organize without an election and imposes bargaining obligations based on a single unfair labor practice during an organizing campaign. The Biden precedent also reintroduced microunits, reinstituted the “quickie” election rules, and just recently changed the rules on what employer can say during organizing campaigns and banned captive audience speeches.
A second Trump Board would be able to repeal other pro-labor policies, including attempts to change the NLRB joint employer standard, and precedent governing independent contractors, requiring scrutiny of handbooks and employer policies, invalidating common severance provisions, and imposing extraordinary remedies for unfair labor practices.
Civil Rights Enforcement and DEI
While not likely to materialize immediately, we expect to see significant changes at the Equal Employment Opportunity Commission (EEOC) and Office of Federal Contract Compliance Programs (OFCCP) in the new Trump administration. In the short term, current Republican EEOC Commissioner Andrea Lucas will likely be appointed Chair or Acting Chair of the Commission, and the three current Democratic commissioners will likely stay on until their terms expire. (Commissioner Jocelyn Samuels’ term is the first to expire, in July 2026.)
It is expected that EEOC General Counsel Karla McBride will be replaced by an acting General Counsel, likely a career EEOC attorney, until the president can nominate a new General Counsel, and Acting OFCCP Director Michelle Hodge, a career attorney at the US Department of Labor (DOL), will likely stay in her role until the president appoints a new OFCCP director.
In the short term, we do not expect significant changes in substantive policy or enforcement. There likely will be a continued focus on enforcement of the Pregnant Workers Fairness Act and, as in the first Trump administration, a focus on religious discrimination. We could also see a greater focus on compliance assistance rather than litigation. Once there is a Republican majority, we may see the Commission seek to reissue updated conciliation procedures, as such procedures were issued at the end of the first Trump administration but disapproved by the US Congress under the Congressional Review Act.
Perhaps the biggest change in substantive focus will be DEI. In her prior statements, EEOC Commissioner Lucas has openly criticized race- and gender-exclusive mentoring, sponsorship, and training programs; diverse candidate slate policies; tying executive compensation to diverse representation; and diversity internships. We can expect to see EEOC scrutinize such programs in the short term, and possibly increase its litigation activity and amicus brief participation on these issues once there is a Republican majority.
On the OFCCP side, changes in policy may also be on the horizon. During his first administration, President Trump issued an executive order prohibiting “divisive concepts” in workplace diversity training offered by federal contractors and establishing a national hotline so that OFCCP could field and investigate complaints. OFCCP also issued letters challenging corporate aspirational goals. Given current Republican officials’ criticism of DEI, OFCCP under the new administration may pursue similar initiatives.
Wage and Hour
Considering how key wage and hour and employee classification laws have changed following administration shifts over the last 16 years, there is reason to believe that the second Trump administration will seek to rescind, reverse, modify, or put on hold some of the Biden administration’s rulemaking.
As two prime examples, on January 10, 2024 the DOL published a final rule scrapping the Trump-era independent contractor rule that focused on control factors and instead applying a totality-of-the-circumstances economic realities test. The new test’s ultimate inquiry is whether, as a matter of economic reality, the worker is economically dependent on the employer (and thus an employee) or in business for themselves (and thus an independent contractor) by reference to a nonexhaustive list of six factors.
While one of those factors is “control” over the worker, the importance of that factor is significantly diminished under the new Biden DOL rule, making it harder for individuals to be independent contractors. Given the history of this standard, it would not be surprising to see the new Trump administration go back to a control test or otherwise try to make it easier for gig workers to be independent contractors.
As a second example, the standards for joint employment have seen significant regulatory changes. In March 2020, the Trump administration’s DOL introduced a new rule with revised factors for determining joint-employer relationships, but much of it was invalidated by a federal court in the Southern District of New York for conflicting with the Fair Labor Standards Act (FLSA). In 2021, the Biden administration withdrew the rule, citing its inconsistency with statutory language and previous DOL guidance. However, no new regulatory guidance has been proposed as a replacement and the new Trump administration may decide to go back to its March 2020 rule or some other alternative.
On April 17, 2021, President Biden signed Executive Order 14026, “On Increasing Minimum Wage for Federal Contractors,” raising the minimum wage for federal contractors to $15.00 per hour effective January 30, 2022. The order further provided that the minimum wage will be increased annually in an amount determined by the Secretary of Labor. However, that order was enjoined by a court in Texas, and under the new Trump administration the DOL could drop its efforts to challenge the court’s ruling.
For private sector employers, we expect to see continued opposition to any increases to the federal minimum wage in favor of maintaining the current rate on the basis that further increases will have a negative impact on small businesses. Similarly, the DOL issued a final rule on April 23, 2024 increasing the salary basis threshold for the white-collar exemptions. That rule was challenged in multiple lawsuits in Texas, and on November 15 the Eastern District of Texas granted summary judgment to the State of Texas and a group of plaintiff businesses.
The ruling purports to vacate the DOL’s 2024 rule in its entirety nationwide, including the increase that went into effect on July 1, 2024. As a result, the salary threshold for exempt status theoretically reverts back to the DOL’s 2019 rule, which set the EAP exemption at $684 per week, or $35,568 annually, and the HCE exemption at $107,432 per year. The current DOL could seek to appeal that decision to the Fifth Circuit Court of Appeals, which recently affirmed the DOL’s ability to implement rules interpreting and applying the FLSA. The Trump DOL could then choose to withdraw such an appeal, refrain from action in that and in several other pending challenges, or take other action to stop the second phase of increases from occurring (such as revoking the rule).
Other possible initiatives include creating some comp time alternative to paying overtime to workers (today only some public sector employers have that option); increasing business-friendly resources such as the Payroll Audit Independent Determination (PAID) program to self-correct minimum wage and overtime violations; and removing or reducing the taxation on overtime and tipped wages. Of course, blue states could continue to enact their own protections that go beyond federal law.
Workplace Health and Safety
Historically, the Occupational Safety and Health Administration (OSHA) has garnered support from both sides of the aisle and, unlike many of the other topics discussed, OSHA enforcement does not vacillate based on the party in control of the White House. According to data published by OSHA, the total number of OSHA inspections actually decreased under the Biden administration compared to the first Trump administration, even putting aside the outlier pandemic years of 2020 and 2021 when enforcement dropped significantly.
That said, we do expect a significant shift in OSHA’s approach to rulemaking. There are various current OSHA rulemakings that the new administration could try to pause, including its landmark proposed heat standard (on which we previously wrote) and its emergency responder standard.
The Trump administration could also revoke or revise rules that the Biden administration successfully enacted. For example, it could drop its defense of the agency’s “union walkaround rule,” which is currently subject to legal challenge, or revise its 2023 recordkeeping and reporting rule. Finally, we will be watching for other trends such as a renewed focus on compliance over enforcement, explicit nonenforcement for home offices, and enforcement exemptions for certain employers such as first-time violators.
Business Immigration
Although the Trump campaign’s platform did not include specific business immigration proposals for a new administration, statements made by President Trump and those involved in immigration policy during his first administration suggest that a second Trump administration may favor the following:
A second Trump administration could also result in increased processing times at agencies involved in immigration adjudications such as US Citizenship and Immigration Services and the DOL as well as slowdowns, backlogs, and limited availability for visa adjudication at US consulates abroad, with more restrictive adjudicatory standards and new burdensome documentary requirements for temporary visa applications and green card applications. As with other agencies, staffing and resource reduction can be expected, especially at agencies adjudicating and administering immigration matters.
At the same time, it is unclear what influence Big Tech and Big Finance—both of which employ significant numbers of highly skilled immigrants—might have on the administration’s business immigration policies. Initial restrictive initiatives might be moderated if they are resisted by the business community. In addition, recent US Supreme Court and lower court decisions create additional legal theories for challenging executive branch authority to interpret and apply existing laws.
Restrictive Covenant Agreements
With the incoming Trump administration, coupled with recent litigation, one outcome could be an end to administrative attempts to control and restrict noncompete agreements. Apart from two attempts to legislatively control noncompete agreements in 2015, state courts and legislatures have historically controlled the enforceability of restrictive covenant agreements including noncompete and nonsolicitation agreements until President Biden took office and issued an executive order in July 2021 directing the Federal Trade Commission (FTC) to ban or limit noncompete agreements at the federal level.
While the FTC’s final rule prohibiting most noncompete agreements was set to take effect on September 4, 2024, litigation resulted in an order setting the FTC’s rule aside. The FTC is now appealing that order.
FTC Chair Lina Khan may be replaced by one of two Republican Commissioners. The replacement of NLRB GC Abruzzo, discussed in the Labor Law section, could also precipitate an end to the NLRB’s attempts to control noncompete use.
It is possible that the new FTC leadership will want to abandon enforcement attempts of the FTC noncompete rule, perhaps ending pending federal appeals and returning this issue to the states. In such a case, we could see an uptick in state legislation designed to limit noncompete use or place restrictions on scope, choice of law provisions, or require that certain salary thresholds be met.
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