Category: Advocacy

DOL’s Jessica Looman Joins the Speaker Lineup for the CEA Legislative & Regulatory Conference

Principal Deputy Administrator for the U.S. Department of Labor’s Wage and Hour Division Jessica Looman has joined the lineup of speakers for the Construction Employers of America (CEA) legislative and regulatory conference on Wednesday, July 21st from 11:00 am – 3:00 pm EDT. The virtual event will focus on key regulatory and legislative issues affecting the union construction industry today. As with previous in-person conferences, the CEA will host both Regulators and Representatives from Congress for their expertise and insight on a variety of topics such as: 

  • The regulatory landscape for Multiemployer Pension Plans based upon enactment of the American Rescue Plan Act (ARPA) of 2021.
  • Department of Labor efforts to address Employee Misclassification.
  • OSHA developments of interest to the construction industry.
  • Infrastructure spending in the Energy and Building Market Sectors and proposed tax measures to fund it.

Who is the CEA?

We are a coalition of seven premier national construction specialty contracting associations, working together to raise awareness among policymakers, opinion leaders, and the general public, about the value of high-quality American construction. CEA engages on national, state, and local public policy initiatives to strengthen the domestic construction industry and provide opportunities for top-quality construction workers to earn the skills they need to command high wages.

Withum Webinar Will Share What All Businesses Need to Know About ERC and PPP

Pandemic legislation has created significant opportunities for small and medium sized businesses. Rules ever changing, the programs have been shaped time and time again. Spend one hour with Withum experts as they detail some of the programs which have been most beneficial to businesses. The free webinar takes place June 28, 2021 from 2:00 pm – 3:00 pm EDT.

Learning Objectives

During this session, we will cover the most up-to-date details on the following:

  • Paycheck Protection Program – Analyze lessons learned and understand best practices and pitfalls to avoid. We will also discuss the current status of loans in review with the SBA.
  • FFCRA Credits – Identify the payroll tax credits available to employers compensating employees for sick and family leave time, as well as updates to the program regarding absences related to employees receiving the vaccine.
  • Employee Retention Credit – Clarify changes in the program rules and regulation, and review of your businesses’ eligibility is a must. Our team will have a detailed discussion on eligibility and the opportunity available. We will also discuss the important consideration of the interplay between the ERC and the PPP Loan Forgiveness Calculation.

We want to ensure that any questions around either of these relief efforts are clarified. Our experts can assist with further calculations and opportunities following the webinar.

Presenters 

  • Frank Boutillette, CPA, CGMA, Partner, Market Leader, SBA Financial Assistance Services
  • Daniel Mayo, JD, LLM, Principal, National Lead, Federal Tax Policy
  • Matthew Walsh, CPA, MS, Lead, SBA Financial Assistance Services
  • Louis Young, CVA, Dealership Services, SBA Financial Assistance Services

REGISTER

Join MCAA & CEA Virtually to Discuss Key Legislative & Regulatory Issues

The Construction Employers of America (CEA), of which MCAA is a charter member, will be hosting this year’s legislative and regulatory conference virtually on Wednesday, July 21st from 11:00 am – 3:00 pm EDT, and it will focus on key regulatory and legislative issues affecting the union construction industry today. As with previous in-person conferences, the CEA will host both Regulators and Representatives from Congress for their expertise and insight on a variety of topics such as: 

  • The regulatory landscape for Multiemployer Pension Plans based upon enactment of the American Rescue Plan Act (ARPA) of 2021.
  • Department of Labor efforts to address Employee Misclassification.
  • OSHA developments of interest to the construction industry.
  • Infrastructure spending in the Energy and Building Market Sectors and proposed tax measures to fund it.

Who is the CEA?

We are a coalition of seven premier national construction specialty contracting associations, working together to raise awareness among policymakers, opinion leaders, and the general public, about the value of high-quality American construction. CEA engages on national, state, and local public policy initiatives to strengthen the domestic construction industry and provide opportunities for top-quality construction workers to earn the skills they need to command high wages.

Legislative and Regulatory Issues and Progress – Prevailing Wage, PBGC Grants, COVID-19 Cost Escalation Relief & More

MCAA’s Government Affairs Committee offers an update on the latest happenings on Capitol Hill, including a big victory for prevailing wage policy, possible upcoming positive administrative reforms in the federal prevailing wage program, a shift in construction workforce policy in MCAA members’ favor, an update on PBGC grants for critical and declining multiemployer pension plans, and MCAA advocacy for COVID-19 pandemic cost escalation adjustment clauses in federal contracts. The committee remains busy protecting our MCAA members’ interests on Capitol Hill and providing members with the latest information through programming like the virtual MCAA/CEA National Issues Conference slated for July 21 from 11:00 a.m. to 3:00 p.m. EDT.

Big Victory for Prevailing Wage Policy

A recent vote in the Senate heralded a big victory for prevailing wage policy, and the first statutory expansion of prevailing wage in related legislation in quite some time. With a 58 to 42 vote on the Cornyn Amendment (Amendment No. 1858) to the Endless Frontier Act (S. 1260), the majority in the Senate extended Davis Bacon prevailing wage standards to domestic computer chip manufacturing construction funded in the measure (some $52 Billion).

Eight Republicans crossed over to the Democratic side, supporting the extension of prevailing wage standards to chip plant construction by opposing the Cornyn Amendment:

  • Senator Roy Blunt (MO) (retiring)
  • Senator Shelley Moore Capito (WVA)
  • Senator Steve Daines (MT)
  • Senator Lisa Murkowski (AK)
  • Senator Rob Portman (OH) (retiring)
  • Senator Marco Rubio (FL)
  • Senator Dan Sullivan (AK)
  • Senator John Kennedy (LA)

MCAA Seeks Positive Administrative Reforms in Federal Prevailing Wage Program

MCAA is working with the Biden Department of Labor (DOL) on considering positive administrative reforms in the federal prevailing wage program.  The Labor department’s Wage and Hour Division Principal Deputy Administrator, Jessica Looman, is invited to make a presentation to the MCAA/CEA Legislative Issues Conference on July 21.

Government Affairs Developments

The Biden Administration’s American Rescue Plan contained the Butch Lewis multiemployer pension reform bailout measure. Under the measure, some 200 or so critical and declining multiemployer pension plans may be eligible to receive some $86 billion or more of Pension Benefit Guaranty Corporation (PBGC) grants. These grants would pay pension benefits and expenses for the next 30 years.

While the new PBGC program is big and expensive, it will no doubt take a lot of pressure off the multiemployer system, which will benefit MCAA member companies. The PBGC regulations are due out by mid-July.

The critical and declining plans are a problem created as much by misadministration of government regulations as anything else, so it’s apt that the government pays for the remedy.

MCAA and the multiemployer reform coalition continue to push for a new plan design – Composite Plans and re-tooled and more expansive Variable Benefit Plans that will tackle and resolve the problem of the contingent liability of employer unfunded vested benefits withdrawal liability.

MCAA Leads Effort to Get COVID Escalation Adjustment on Direct Federal Contracts

MCAA is leading the effort to get a COVID-19 pandemic cost escalation adjustment in direct federal contracts that were bid and awarded pre-COVID and performed after the emergency declaration in March 2020. MCAA also is proposing a new pandemic cost adjustment escalation clause in the Federal Acquisition Regulation (FAR) for future direct federal contracts to eliminate pandemic cost contingencies in bidding and to stabilize costs for the government. Both efforts will have a long-term impact for our members, many of whom are struggling to recover the added cost of continuing work during the pandemic.

Questions about any of this information should be directed to John McNerney.

Legislative and Regulatory Issues and Progress – Tax Credits, Multiemployer Provisions of the ARP & Worker Misclassification

MCAA’s Government Affairs Committee offers an update on the latest happenings on Capitol Hill, including tax credits available to employers under the American Rescue Plan (ARP) and the rescinding of the Trump Administration’s pending regulations that would have relaxed safeguards against worker misclassification. The committee remains busy protecting our members’ interests on Capitol Hill.

ARP Expands Paid Family & Medical Leave Tax Credits

The American Rescue Plan (ARP) has expanded the paid family and medical leave tax credits. The credits include added coverage for collectively bargaining health, pension and apprenticeship costs. If employers voluntarily provide the leave, they may claim the credit before it expires on September 30, 2021.

READ THE IRS FACT SHEET

NCCMP Summarizes the Multiemployer Provisions of the American Rescue Plan

The National Coordinating Committee for Multiemployer Plans (NCCMP) summarizes the ARP provision of the tax credit in its Multi-Elert® on the passage of the American Rescue Plan:

Summary of the Multiemployer Provisions of the American Rescue Plan—Other Provisions
Sections 3131 and 3132—Credit for Paid Sick and Family Leave

In addition to 100% of the qualified sick or family leave wages paid by an employer, employers with fewer than 500 employees may also claim as a tax credit the amounts paid to the participant’s group health plan as well as the portion of the employer’s collectively bargained contributions to a defined benefit pension plan and to a registered apprenticeship program that are allocable to the qualified sick leave wages or qualified family leave wages, subject to certain daily and aggregate limitations. Qualified sick or family leave wages are wages or compensation paid to an employee who is unable to work or telework for certain specified reasons related to the COVID-19 public health emergency.

The Multi-Elert also describes the ARP benefits provisions overall, including primarily the Butch Lewis Act multiemployer pension plan provisions.

READ THE NCCMP MULTI-ELERT

DOL Rescinds Pending Regulations that Would Have Relaxed Worker Misclassification Safeguards

Effective May 6, 2021, the Department of Labor (DOL) rescinded the Trump Administration’s pending regulations that would have relaxed safeguards against worker misclassification under the Federal Fair Labor Standards Act, the Federal wage-and-hour law.

The Biden Administration’s Labor Department solicited comments on the proposed relaxation of the well-settled rules and determined that the hasty Trump Administration changes impermissibly discounted well-established judicial and regulatory precedents in favor of a more general and permissive analysis of formerly proper employee classification criteria. With this well considered judgment, announced May 5, 2021, the Labor Department returns the issue to the status quo before the last-minute Trump Administration changes.

MCAA and the Construction Employers of America commented on the proposed rescission, arguing that the prior Administration’s rulemaking was an expedient measure that threatened to undermine well-established safeguards supporting responsible employer employee classification judgments and workforce investments. However, even with this remedial step, still more needs to be done.

MCAA and a great many other construction industry employer groups have long argued that the subject of worker misclassification is long overdue for a more comprehensive legislative and regulatory overhaul. This Labor Department action is a step in that direction, but MCAA has asserted that Congress should eliminate the long lingering legislative permission for grandfathering misclassification and support an interagency review of the issue in its entirety.

With so much of the country’s employment protections and social and economic policy with respect to health and welfare benefits premised on the proper and responsible adherence to legal worker classification practices, responsible employers and the taxpayers deserve more scrupulous government policy attention to rampant misclassification across all industries and the gig economy.

The tax gains from stemming rampant misclassification abuse could go a long way toward funding the upcoming infrastructure investment program. It would further ensure that work is awarded to responsible contractors, rather than allowing misclassification to spread and thereby continue to incentivize disinvestment in proper workforce classification.

READ THE DOL NEWS RELEASE

Questions about any of this information should be directed to John McNerney.

MCAA’s Advocacy and Political Action Initiatives Are Worthy of Your Ongoing Consideration

To my fellow MCAA members and the leaders of MCAA’s local affiliates,

Effective public policy advocacy and non-partisan political activities go hand-in-hand with a broader suite of association member services at MCAA.

When MCAA’s Board of Directors re-instituted MCAA’s Political Action Committee over 20 years ago, they did so with a renewed commitment to building the profile of pipe trades union-signatory employers’ key role in the industry, and in policy deliberations in Washington, DC.

That foresight and initiative have paid off and will continue to do so into the future with our members’ and local affiliates’ ongoing commitment to that vision.

I and my fellow MCAA Government Affairs Committee members below are fully committed to that vision.

  • Kevin Armistead, Armistead Mechanical, Waldwick, New Jersey
  • Richard Bukovec, Diversified Piping & Mechanical, Inc., Mentor, Ohio
  • David Cannistraro, J.C. Cannistraro, Watertown, Massachusetts
  • Dennis Corrigan, Corrigan Company, St. Louis, Missouri
  • Chuck Daniel, MCA of Maryland, Baltimore, Maryland
  • John Ferrucci, F & F Mechanical Enterprises, North Haven, Connecticut
  • Don Giarratano, Muir-Chase Plumbing, Anaheim, California
  • Alex Hayes, Rock Mountain MCA, Denver, Colorado
  • Mike Miller, Kirlin Design Build, Rockville, Maryland
  • Marc Pittas, The Hill Group, Franklin Park, Illinois
  • Dick Reigles, Reigles Mechanical, Grand Junction, Colorado
  • Richard J. Sawhill, ARCA/MCA, Ontario, California

We ask you to join us in that commitment. Here are some key points to consider.

MCAA Is Playing A Critical Role in Multiemployer Pension Reform

Multiemployer pension reform is in the works – finally. It was a long and arduous road – and there’s more ground to cover. MCAA, together with our partners at the UA, were key and effective players in that process.

Your association has a seat at the table thanks to MCAA members’ commitment to participation in the policy development process and the political activity that goes hand-in-hand with that.

If multiemployer pension reform comes out in our favor, it will be guided in that direction by continuing MCAA participation. Your firm and our industry will be immeasurably improved as compared with what might have been with a failing multiemployer system adversely affecting all of our businesses. Together, MCAA and the UA helped avoid that catastrophe.

MCAA Member Involvement Was Responsible for Other Key Achievements

Looking back, our MCAA member involvement was directly responsible for some other key achievements and direct member benefits over recent years, including some few examples below.

  • Keeping ill-conceived accounting disclosure rules relative to pension liability off our books – and staying vigilant about a recurrence of those problems.
  • Eliminating flow-down withholding taxes on Federal projects and adding some small subcontracting bidding protections for Federal primes and subcontractors.
  • Attaining market tax incentives for green building retrofits.
  • Maintaining prevailing wage standards – key elements of industry reforms.
  • Representing you vigorously in the health policy debate.
  • Actively fighting to maintain high-quality industry apprenticeship training programs.
  • Ensuring prevailing wage and labor law reforms in the coming years strengthen MCAA members’ market share.
  • Advocating for a number of legislative and regulatory reforms to staunch the rampant abuse of worker misclassification in the construction industry.
  • Supporting government initiatives to improve government responsible contractor selection policies for prime contractors and subcontractors.
  • Gaining elimination of reverse auction procurement procedures in Federal construction contract selections.
  • Advocating for collective bargaining and ERISA preemption of state, local and Federal paid leave mandates.

MCAA Continues to Advocate for Our Industry’s Best Interests

Looking ahead, there are larger general trends and market factors that will influence the direction of public policy, including workforce demographic challenges, rapid technological developments, and environmental challenges to our society as a whole and our industry in particular.  All of these trends will have some bearing on public policy choices in Washington, DC. Our MCAA member advocacy program and political action infrastructure must be maintained so that we – MCAA members – maintain our strong position to advocate for our industry’s best interests.

MCAA PAC Needs Your Commitment and Involvement to Keep the Momentum Going

Please consider your role in helping your fellow members shape our future with effective advocacy in Washington, DC. If you want to be part of your industry’s continued competitiveness:

  1. Join our efforts by going to the MCAA PAC website and completing  the prior authorization form to allow MCAA PAC to send you solicitation material.
  2. Reach out to your local affiliate Boards and ask them to do the same on your behalf.
  3. Get your local association directly involved with lawmakers and political decision makers in their home districts, where your voice is heard directly and most effectively.

Call me to discuss how you can get involved.

Best Regards,

Jim Gaffney, Goshen Mechanical, West Chester, Pennsylvania
Chairman MCAA Government Affairs and Political Action Committees

MCAA and Leading Experts Discuss What Recent Multiemployer Pension Reforms Will Mean for Your Company

What do the multiemployer pension reforms in the Butch Lewis Emergency Pension Plan Relief Act of 2021 (signed into law by President Biden in the American Rescue Plan Act of 2021 on March 11, 2021) mean for your company? MCAA’s John McNerney is joined by leading industry experts Earl Pomeroy of Alston & Bird and Josh Shapiro of The Groom Law Group to lay out the details of the law, the questions remaining to be answered in regulations issued by the Pension Benefit Guaranty Corporation in the 1,200 days from enactment, and what it will mean for your plans and the industry overall. Mr. Shapiro and Mr. Pomeroy will also speak about remaining reform items to be addressed in upcoming enactment of Composite Plans and perhaps also new and improved Variable Benefit plan options for trustees to consider.

About the Presenters

Former Congressman Earl Pomeroy, who served in Congress for 18 years, and as a member of the prestigious House Ways and Means Committee, was the lead sponsor of the Pomeroy-Tiberi pension reform proposal as early as 2010. He is currently consulting with MCAA on pension reform issues.

Josh Shapiro is a leading actuarial expert on multiemployer pension issues in Washington, D.C., having served as the research and policy director at the National Coordinating Committee for Multiemployer Plans, and for the past eight years as a pension/actuarial advisor at The Groom Law Group in Washington, D.C. For many years, Mr. Shapiro and Groom Law Group have served as advisors to MCAA on pension and other employee benefits policy issues.

John McNerney is MCAA’s General Counsel. He also serves as executive director of government and labor relations at MCAA, collaborating with other specialty construction employer groups and the United Association to advance legislative and policy positions in MCAA members’ best interests.

MCAA Among Supporters of Bill Strengthening Financial Security for Infrastructure Projects

MCAA is among supporters of legislation reintroduced earlier this week that would increase the financial security of federal infrastructure projects. A recent article in Transportation Today highlights the legislation reintroduced by U.S. Sens. Chris Van Hollen (D-MD) and Mike Rounds (R-SD), along with U.S. Sens. Stephen F. Lynch (D-MA) and Troy Balderson (R-OH), Promoting Infrastructure by Protecting Our Subcontractors and Taxpayers Act of 2021.

Webinar to Focus on American Rescue Plan Act of 2021 Provisions for Multiemployer Pension Plans

Horizon Actuarial Services, LLC, and the Groom Law Group will be co-sponsoring a complimentary webinar on the American Rescue Plan Act of 2021 provisions for multiemployer pension plans. The webinar, which will address how recent law changes will impact multiemployer pension plans in general, will take place Tuesday, March 23 at 12:00PM EDT. A summary of the changes can also be found on Horizon’s website.

Tuesday, March 23, 2021 | 12:00 p.m. EDT

On March 11, 2021, President Biden signed a significant COVID-19 relief package – the American Rescue Plan Act of 2021 – into law. Included in this legislation are several provisions that provide temporary funding relief to multiemployer pension plans, as well as a significant amount of special financial assistance that is available to seriously underfunded plans. The temporary funding relief provisions are broadly available to multiemployer plans, and they allow additional time for plan sponsors to address the investment and other losses incurred in recent years. Significantly underfunded plans can demonstrate eligibility for the special financial assistance based on their funded position in 2020, 2021, or 2022. Initial applications for assistance are due by the end of 2025. Financial assistance will be paid to eligible plans as lump sums that do not need to be repaid, and is intended to keep plans solvent through 2051.

The panelists on this webinar will discuss the development and passage of the legislation, the key funding relief and financial assistance provisions, and the various aspects of the legislation that are not fully clear and may be open to multiple interpretations.

REGISTER TODAY

Important Note: You will receive an email from the Groom Law Group on the morning of March 23rd with the link to access the webinar.

Speakers

  • David Pazamickas – Horizon Actuarial
  • Mariah Becker – NCCMP
  • Michael Kreps – Groom Law Group
  • Jason Russell – Segal Consulting
  • Brigen Winters – Groom Law Group

If you have questions on how the law may impact your specific plan, please contact your Horizon Actuarial consultant.

MCAA & Affiliates Continue Push for COVID Cost Recovery on Direct Federal Construction Contracts

MCAA’s initiative with the MCA of Maryland, the MCA of Metropolitan Washington, the MCA of New York, and the New England Mechanical Contractors Association (NEMCA) is moving ahead with contacts in the House and Senate expanding to seek an add-on proposal in either the next COVID relief measure or possibly on the infrastructure proposal that is expected soon. The proposal is relatively simple – Congress should set up a separate COVID Cost Recovery Fund on direct Federal construction contracts to pay impaired productivity and other COVID direct costs to be administered apart from the affected projects’ budgets. The rationale is that it is inequitable for the government as proprietor of the project to take the full benefit of the fixed-price award pre-COVID and then drive a hard bargain denying full equitable cost impact recovery post pandemic, while at the same time using taxpayer resources to bail out other industries outside of any contractual relationship.

MCAA was able to gain the active support of the New York Tri-State Chapter of the National Association of Minority Contractors backing our initiative with New York City Congresswoman Carolyn Maloney, who is chair of the lead committee of jurisdiction on this issue in the House Oversight and Reform Committee (OGR). NEMCA recently was instrumental in gaining the active consideration of Boston area Congressman Stephen Lynch, a high ranking member on both OGR and the Transportation and Infrastructure Committee, which shares jurisdiction on these issues. 

Multiemployer Pension Plans May See Relief from the Butch Lewis Emergency Pension Plan Relief Act of 2021

The Democrats in the 117th Congress are pressing the Butch Lewis Emergency Pension Plan Relief Act of 2021 in two phases. The first phase, the American Rescue Plan of 2021, is moving through the reconciliation process in the House and Senate (not subject to filibuster in the Senate). It would provide funding to enable the Pension Benefit Guaranty Corporation (PBGC) to pay full benefits for plans in critical status (with a funded ratio below 40% and an active to inactive participant ratio of less than 2:3). Funding would also be provided to help critical and declining plans, and those plans that have already cut benefits (or have applications pending) under the 2014 Multiemployer Pension Reform Act (MPRA) benefit suspension procedure. 

Plans would  have until December 31, 2025 to apply for assistance. Estimates are that the amounts required to fund the program will come to some $85 billion and could extend to as many as nearly 280 plans by the expiration of the eligibility period. The payments from PBGC to eligible plans are to pay benefits for 30 years. The payments are grants – they are not loans and are not repayable. As of the end of Plan Year 2020, it is estimated that some 15 United Association (UA) plans would be eligible for PBGC payments. 

As of this writing, the Senate Parliamentarian reconciliation judgments relating to the pension proposal have not been settled, and the House passage is still pending.  All the other non-budgetary policy aspects of multiemployer pension reform – including the adoption of Composite Plans for trustees to consider – remain subject to regular order legislative procedures later in this year.  

Legislative and Regulatory Issues and Progress – Multiemployer Pension Plan Reforms, COVID Cost Recovery & More

MCAA’s Government Affairs Committee has been busy protecting our members’ interests on Capitol Hill. Progress is being made on issues such as multiemployer pension plan reform and equitable compensation for COVID cost impacts. MCAA is also working to prevent the misclassification of employees, protect Federal construction contracts against Internet reverse auctions, and support legislation that would expand apprenticeship and pre-apprenticeship.

Multiemployer Pension Plan Reforms

The much-delayed multiemployer pension reform proposal is moving forward in fits and starts.

Because it now appears the next COVID recovery measure will progress under Reconciliation procedures, only the fiscal aspects of the proposed multiemployer reforms will move forward under Reconciliation. These reforms affect the 220 or so critical and declining plans – with a massive Federal appropriation for the Pension Benefit Guaranty Corporation (PBGC) to secure and fund full benefits for participants in the most severely distressed plans for the next 30 years.

The other aspects of the long-proposed reforms – reform of funding rules, and, for MCAA most critically, new plan designs such as Composite Plans, cannot proceed under Reconciliation, so now must wait for House and Senate leadership to deliver on their promise of new plan design options on a regular order measure later in this session of Congress.

Direct Federal Construction Contract COVID Cost Recovery

The MCAA initiative to provide for full equitable compensation for COVID cost impacts on direct Federal construction projects awarded pre-COVID and performed after the COVID emergency work protocols were put in place continues to make measured progress. MCAA, in conjunction with the New York City Tri-State Chapter of the National Association of Minority Contractors (NAMC), are pressing House and Senate lawmakers to adopt Federal force majeure public contract administration policy changes. These changes would allow full COVID cost impact recovery in addition to contract time extensions. A similar proposal had been included in earlier version of the HEROES Act proposal from Congressional committees last year. The MCAA and NAMC proposal is a specific adaptation of that more general recommendation that stalled in the last Congress HEROES Act negotiations.

Protecting the Right to Organize Act

MCAA’s Government Affairs Committee is analyzing the latest union organizing measure, the Protecting the Right to Organize Act (PRO Act), to see where its provisions might extend out from impacts on open-shop employers to directly affect the interests of union-signatory employers.

While the proposal gained passage in the House in the last Congress, it is expected that its progress this year in both the House and Senate may take a back seat to the more pressing and bipartisan effort to spur economic recovery with a badly needed infrastructure investment measure.

Regulatory Developments

As with any change in Administration, the pace of regulatory reversals on items of interest to MCAA members is broad, starting initially with the standard regulatory freeze.

MCAA expects the late Trump Labor Department initiative redefining the classification criteria for categorizing workers as “employee” under the Fair Labor Standards Act will undergo reversal.

MCAA filed comments on that proposal late last year asking the U.S. Department of Labor (DOL) to participate with the Internal Revenue Service in an industry-by-industry, government-wide set of guidelines for proper classification of workers as either employees or independent contractors and seek whatever Congressional action is necessary to rationalize the patchwork of various Federal rules defining worker classification.

It should be noted that the aforementioned PRO Act would adopt the ABC control test for defining “employees” under the National Labor Relations Act. This supports MCAA’s position in a joint brief with the United Association (UA) to the National Labor Relations Board (NLRB) last year. The brief urged that worker misclassification itself, judged by whatever standard, should be considered an unfair labor practice of denial of that misclassified worker’s rights to engage in protected concerted activity as an employee independent of any other unfair labor practice  charge.

Direct Federal Construction Contract Selection Procedures – Ban On Reverse Auctions, Proposed FAR Case On Subcontractor Bid Listing

Also in December, the Trump Administration’s General Services Administration proposed a long-pending ban on reverse auctions for direct Federal construction contract procurement. The proposal on its face may have been limited to only some competitive negotiation or low bid or other price-only selection procedures.

MCAA’s comments, filed with the Government Accountability Office (GAO) in December, called for a re-proposal enacting the clear 2020 omnibus spending provision direction that Internet reverse auctions cannot be used on any or all direct Federal design and construction contract selection procedures.

The MCAA comments also requested a Federal Acquisition Regulation (FAR) case examining the re-adoption of subcontract bid listing on all direct Federal bid or proposal submissions for price-only selection procedures. MCAA’s comments can be downloaded here.

President Biden Unwraps IRAPs

President Biden rescinded Executive Order (EO) 13801, the Trump Administration EO that led to the development and promulgation  of Industry Recognized Apprenticeship Programs (IRAPs). This action came ahead of a meeting between President Biden, Vice President Harris, and leaders of the North American Building Trades Union (NABTU) on Wednesday, February 17, 2021 to discuss the Administration’s infrastructure initiative.

MCAA, along with virtually all industry groups, filed comments on the IRAP proposal in July 2019 calling for an exemption of IRAP adoption in the construction industry, which was granted, but remained subject to change.  Today’s Biden Order rescinds, EO 13801, directs the Labor Department to stop approval of Standards Recognition Entities (SREs, the sponsors of IRAPs) and defunds existing SREs. The Biden Directive also expresses support for the proposed new National Apprenticeship Act to expand apprenticeship and pre-apprenticeship and other reforms.  MCAA, along with the Construction Employers of America (CEA), supports the legislative proposal. The Biden directive also reinstates the National Advisory Committee on Apprenticeship at the Labor Department.  It is widely expected that promotion of registered apprenticeship will continue to be an integral part of the Administration’s infrastructure initiative.

Questions about any of this information should be directed to John McNerney.

H.R. 133 Offers Relief, Opportunities and Challenges Going into 2021

The $2.3 trillion Consolidated Appropriations Act, 2021 (H.R. 133) provides badly needed COVID economic relief, construction market stimulus and a forward-looking prospect for market recovery in public sector infrastructure investments as the pandemic recedes. In a memo to the MCAA Government Affairs Committee, Chair Jim Gaffney provided a summary digest of the items most likely to impact MCAA members and the MCAA policy agenda. The President is seeking greater individual stimulus checks, so there may be an amendment or veto, but this summary will stand for most of what will be the final result. Correction: The latest COVID relief measure signed into law Sunday does not extend the requirement that employers offer paid sick and family leave as required under the Families First Coronavirus Relief Act passed last March as erroneously reported in the MCAA summary published in the Weekly Update on December 28, 2020. The latest COVID bill extends only the availability of the refundable tax credit as under the FFCRA until the end of March 2021 for those employers voluntarily providing such paid leave after December 31, 2020. MCAA regrets the error.

Congress Expected to Pass Stimulus Package. Watch Withum’s December 23rd Webinar Covering Package Details On-Demand.

Experts from Withum’s SBA Financial Services and Tax Services teams navigate through the myriad of provisions included in the more than 5,000 page legislative package finalized mid-December. Withum’s team covers in detail the provisions of the legislation which cover the following topics:

  • PPP Loans: Another Round of Funding
  • PPP Loan Forgiveness Process (Round 1 and Round 2)
  • PPP Loan Forgiveness Deductibility

Withum also covers the basics of the following provisions, but expect to have more detailed communications on these as guidance becomes more clear:

  • Unemployment Provisions
  • Stimulus Checks
  • Employer Focused Tax Credits

WATCH ON-DEMAND

Connect with Peers on Hot-Button Issues at the 2020 Industry Improvement Funds Virtual Seminar on December 3, 2020 at 11:00 a.m. EST

Discover perspectives from around the country when you connect with industry improvement fund trustees and local association executives at the 2020 Industry Improvement Funds Virtual Seminar. Group discussions will provide time to learn from one another about hot-button topics: the new norm, engagement, post-COVID actions and collective bargaining agreement extensions. Groups will be pre-assigned to provide a variety of perspectives from around the country. The seminar will also include legal updates and a legislative and regulatory outlook. Join us on December 3, 2020 from 11:00am – 1:45pm Eastern for this free education. Don’t delay – register today!

Withum’s Latest Developments with the PPP Loan Forgiveness Webinar

Withum’s SBA Financial Assistance Services Team held a webinar on November 20, 2020 discussing the latest developments with the SBA Loan Forgiveness Application submissions.

Topics included:

  • Detailed discussion of which PPP Loan Forgiveness Application Forms are appropriate to use:
    • Form 3508
    • Form 3508 EZ
    • Form 3508 S
  • Common preparation pitfalls and tips in using third party payroll reports
  • The newly issued and controversial “Loan Necessity Questionnaires” – Forms 3509 (For-Profit Borrowers) and 3510 (Non-Profit Borrowers)
  • Tax and US GAAP treatment of PPP loans

VIEW RECORDING

VIEW SLIDES

Register Now for the 2020 Industry Improvement Funds Virtual Seminar

Registration is now open for the 2020 Industry Improvement Funds Virtual Seminar on December 3, 2020 from 11:00am – 1:45pm Eastern. The seminar will provide legal updates and a legislative and regulatory outlook. Group discussions centered around the new norm, engagement, post-COVID actions and collective bargaining agreement extensions will round out the program. Don’t delay, register now for this complimentary education.

MCAA and the UA File Joint Comments on Independent Contractor Status

In a joint letter to the Department of Labor (DoL) submitted on October 26, 2020, MCAA and the UA requested that the agency withdraw proposed regulations on independent contractor status under the Fair Labor Standards Act (RIN 1235-AA34).

The joint comments extend a decades long collaboration between the UA and the MCAA on this very important issue that dates back to 1996, when the two organizations worked together on testimony at the House and Senate fiscal committees on the then proposed Section 530 tax law changes to close the worker misclassification loophole (which has yet to be addressed). The UA and MCAA continue to work jointly to address the very intractable and serious tax and workforce standards, and fair competition abuses of tax cheating by unscrupulous employers that misclassify employees as independent contractors.

The most recent joint MCAA/UA comments to the Labor Department on the proposed loosening of the “economic reality” test to judge if workers are covered by the Fair Labor Standards Act seeks a roll back of the proposal and urges DoL to take a much broader approach to effectively address the long-standing and unabated serious abuses of worker misclassification.

In the letter, MCAA President Brian Helm and UA General President Mark McManus state that, “In fact, the DoL proposal is hasty in the extreme, too narrow, unfairly permissive, and misses an opportunity to make significant strides in stemming abuses, rather than narrowing the established DoL economic reality/suffer and permit framework for worker classification analysis, to open up a more lax administration of that standard.”

The MCAA/UA comments go beyond characterizing the problem, which has long since been well documented by myriad studies at the Federal and state levels, and questions why the DoL has chosen to take this hasty and narrow approach at this late stage of the Administration. The joint MCAA/UA comments call for a much broader and long overdue inter-agency approach by affected Federal workforce enforcement agencies to create a more effective remedial approach by all Federal labor and employment and tax enforcement agencies – including issuing industry-by-industry compliance guidance.

In the letter, MCAA President Brian Helm and UA General President Mark McManus strongly assert that, “…the MCAA/UA joint interest in finally and comprehensively staunching the longstanding and persistent scourge of worker misclassification, unfair competition, legal compliance avoidance, and tax cheating by unscrupulous employers in the construction industry – where misclassification goes beyond prevalent to rampant – …is very strong and in perfect parallel with the public interest in maintaining high workforce standards.”

Joint Comments

Treasury Department Issues Guidance on Payroll Tax Deferral

By: Jim Paretti, Michael J. Lotito, and William Hays Weissman
August 31, 2020

On August 28, 2020, the U.S. Department of the Treasury issued guidance for employers with respect to the deferral of the employee portion of certain payroll taxes.  This guidance stems from a presidential memorandum issued earlier in the month authorizing employers to defer payment of these taxes.  That memorandum allowed for the deferral of the employee portion of federal payroll taxes (6.2% for Social Security and 1.45% for Medicare) from September 1, 2020 until December 31, 2020.  The memorandum allows employers to defer payment of the employee portion of these payroll taxes for workers earning less than $4,000 on a biweekly basis (roughly $104,000 annually). 

Treasury’s guidance makes clear that an employer may elect to defer the payment of the employee portion of these taxes on “applicable wages” until next year, when they would be owed in installments between January 1, 2021 and April 30, 2021.  “Applicable wages” are defined as those wages paid to an employee on pay dates between September 1, 2020 and December 31, 2020, “but only if the amount of such wages or compensation paid for a bi-weekly pay period is less than the threshold amount of $4,000 or the equivalent threshold amount with respect to other pay periods.”  The guidance specifies that applicable wages are determined on a pay period by pay period basis.  Finally, the guidance makes clear that employers are required to pay these taxes to the federal government, but goes on to state that employers “may make arrangements to otherwise collect the [due taxes] from the employee.”

The guidance leaves several clear takeaways.  First, it is clear that an employer is permitted to defer payment of these taxes, but is not required to.  Second, it is likewise clear that unless further action is taken (likely by Congress), these taxes are merely deferred, not forgiven, and will be due by the end of April 2021.  Finally, it is not clear what, if any, role an individual employee plays with respect to determining whether they want their share of these taxes deferred, or paid in the normal course.  Employers will want to keep each of these points in mind as they evaluate whether or not to participate in this elective deferral.

It is unclear whether Treasury will issue additional guidance regarding this program.  Littler WPI will keep you apprised of relevant developments.