Trump administration withdraws two Obama legal opinions, signaling labor law changes
Labor Secretary Alexander Acosta has withdrawn two Obama administration legal opinions that expanded protection for workers. One opinion had directed Labor Department employees to use a broad definition of who is an employee versus who is a freelancer. The definition that Acosta appears to favor could allow companies to classify more workers as freelancers. Those workers would then not be subject to federal wage and hour regulations and laws.
Many small businesses use freelancers, or independent contractors, rather than hire employees.
Acosta also withdrew an opinion that broadened the definition of what’s known as a joint employer. Companies or organizations are considered joint employers if they share control over workers. The broader approach that Acosta has withdrawn theoretically raises the likelihood that, for example, a franchise parent company might be considered a joint employer with a franchisee.
Labor lawyers said Acosta’s moves have little immediate impact on current law, but indicate that the Trump administration plans to take a less aggressive approach toward enforcing wage and hour regulations and the Fair Labor Standards Act, which establishes minimum wage, overtime pay, record-keeping, and child labor standards.
The House last week passed the Financial Choice Act, which aims to eliminate regulations under the banking law known as Dodd-Frank including some that have affected community banks. The bill now goes to the Senate but is not expected to go very far; senators have said they will pursue their own overhaul of Dodd-Frank.
Community banks, whose business customers tend to be small companies, say they’re unable to compete with larger banks because of the costs of complying with Dodd-Frank regulations. The law has increased the amount of paperwork that all banks must complete, particularly on mortgages and other loans, but larger banks are better able to absorb those costs because they have much more revenue than their community counterparts.
Many community banks have had to merge with larger ones in recent years.
Many women-owned businesses don’t take advantage of the Section 179 tax deduction, which gives small businesses a break on equipment purchases. That’s the finding of a survey by researchers at American University’s Kogod School of Business. The survey found that 38 percent of the 515 women-owned companies questioned didn’t know about the deduction, although they can deduct up front $510,000 in equipment purchases for 2017. Another 15 percent said they don’t usually buy equipment so they don’t benefit from the deduction.
The Section 179 deduction, named for a provision of the federal tax law, allows small companies to get a deduction for the full cost of a wide variety of equipment including computers, vehicles, manufacturing machinery and furniture. Purchases above the $510,000 threshold can be depreciated over a period of years; small businesses can deduct or depreciate a total of $2.03 million in purchases. Above that level, the Section 179 deduction is phased out.
Article Courtesy of CNBC