President Biden has announced that he will nominate Julie Su to succeed outgoing Secretary of Labor Marty Walsh. As we have previously reported, Mr. Walsh will leave his post in mid-March to become the Executive Director of the National Hockey League Players Association.
Ms. Su has been Deputy Secretary of Labor since July 13, 2021. According to a press release issued by the U.S. Department of Labor, she is “the de-facto chief operating officer for the department, overseeing its workforce, managing its budget and executing the priorities of the Secretary of Labor.”
Before joining the U.S. Department of Labor, Ms. Su was Secretary of Labor for the State of California, overseeing the state’s Labor and Workforce Development Agency. That agency is responsible for enforcing workplace laws, combatting wage theft, ensuring health and safety on the job, and administering unemployment insurance, workers compensation, and paid family leave.
President Biden called Ms. Su “a champion for workers, and a critical partner to Secretary Walsh since the early days of my administration.” She has the support of the Congressional Asian Pacific American Caucus and the Congressional Black Caucus.
As deputy labor secretary under Secretary Walsh, Ms. Su oversaw the development of the DOL’s COVID-19 vaccination rules (one of which was subsequently struck down by the U.S. Supreme Court), the drafting of proposed regulations on independent contractors, and establishing wage rates for workers on federally funded construction projects.
Ms. Su was born in Wisconsin to Chinese immigrants, and is fluent in Mandarin and Spanish. Her undergraduate degree is from Stanford University, and her law degree is from Harvard. Before entering government service, she represented Thai immigrants who were working for less than the minimum wage and obtained compensation for them from the companies that used their employer as a supplier.
As the above may indicate, Ms. Su’s nomination is not likely to be viewed favorably by Senate Republicans. During her confirmation hearing for deputy secretary in 2021, Republicans on the Senate Health, Education, Labor, and Pensions Committee expressed concerns about unemployment fraud in California and the state’s independent contractor law. Sen. Bill Cassidy of Louisiana, the top-ranking Republican on the HELP Committee, was recently quoted in Employment Law 360 as saying, “She’s got some issues, both in her role in California, but then her subsequent role as deputy secretary.”
Many employers will share Sen. Cassidy’s sentiments. As Secretary of Labor, Ms. Su would be expected to take the DOL in a direction that is even more employee-friendly than it currently is. For example, Ms. Su is expected to support the Protecting the Right to Organize Act – also known as the “PRO Act” – which was reintroduced in Congress on Tuesday. Ms. Su would also be expected to play a role in the creation of a wage-hour regulation (scheduled for issuance in May) that applies to the white-collar exemptions. The regulation is expected to raise the salary threshold for exempt white-collar employees from its current $35,568 to $47,500 or higher. The regulations may also require that the salary threshold be indexed to the cost of living, and may address the duties tests. May 2023 will also bring the final draft of the independent contractor regulations, and under the leadership of Ms. Su, the DOL would be expected to take a very narrow view of who is an “independent contractor” and a correspondingly expansive view of who is an “employee” – perhaps, even more than the proposed regulations did.
With a 51-49 Democratic majority in the Senate and Vice President Kamala Harris as a tie-breaker in the event of defections, Ms. Su is reasonably likely to be confirmed. (She was confirmed by the Senate as Deputy Secretary in a 50-47 vote). As a result, employers should be ready to face a DOL that is likely to address regulatory and enforcement actions on a pro-employee basis.
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