The Way

GB's Weekly Governmental Briefing

Through our Governmental Affairs practice, GB is helping to shape the laws and regulations that will define the times ahead. Acting on behalf of the best interests of our clients and our industry.
Each week, we bring it all into focus.

Labor Week

Aug. 31, 2016

Ahead of this Monday's Labor Day Holiday in the U.S., we're tracking a number of initiatives the Department of Labor (DOL) advanced this week.

IT'S FIVE O'CLOCK SOMEWHERE

The DOL issued final rules that will create a pathway for retirement savings plans to be administered by states or certain large U.S. cities. Currently, about one third of all workers do not have access to a retirement savings plan through their employer. President Obama lauded these rules, calling them a major step toward ensuring that every American can save for retirement at work. Some industry groups oppose the rules. They argue that by relaxing federal restrictions, like ERISA, state retirement plans are given a leg up on private plans and might actually encourage employers to drop otherwise lucrative investment vehicles, including those offering matching funds.

TAKING CARE OF BUSINESS

The DOL also released final regulations and guidance on the so-called "contractor blacklisting" rules to implement the White House's Fair Pay and Safe Workplaces Executive Order. These regulations ensure that agencies have sufficient information to determine whether federal contractors are providing their workers with basic protections and that taxpayer's dollars only go to contractors that are willing to meet their responsibilities to their employees.

TOMMY USED TO WORK ON THE DOCKS

This week, the DOL issued a proposed rule to clarify maximum and minimum compensation rates for claims under the Longshore and Harbor Workers Compensation Act. The proposed rules would also implement the Act's annual compensation-adjustment mechanism for permanent total disability compensation and death benefits.

UNION'S BEEN ON STRIKE

Lastly, the Labor Department appealed a Texas federal judge's June injunction blocking its persuader rule, which increased employers' disclosure requirements for the hiring of union consultants and attorneys. Business groups requested the injunction arguing that the rule violated free speech and interfered with attorney-client privilege. We'll keep working these stories as they develop.

Product Safety

RECALL ACTIVITY ON THE RISE

Product recall activity in the U.S. increased over the second quarter of 2016 across several industrial sectors, rising to its highest level since 2011. Notably, recalls through the National Highway Transportation and Safety Administration (NHTSA) rose 40 percent over the previous quarter and the number of recalled units increased 100 percent to more than 39.6 million, making Q2 the second highest quarter since at least 2000 for both metrics. Just this week, massive auto recalls affected German, U.S. and Japanese carmakers. Similarly, the Consumer Product Safety Commission (CPSC) witnessed its number of recalled units exceed figures from any quarter from 2005-2015. In the consumer products sector, this week saw a significant product safety recall of baby strollers.

THE COST

Reflexively, the insurance marketplace is responding to the increasing frequency and severity of recall events with insurance products and services aimed at easing the rising cost of recall. And if that were not enough, the insurance market is even responding to the risk of recalling the product's spokesman. We've got our eyes on the agency recall data, which shows no sign of slowing.

Making Our Way Around the Country

SURGEON GENERAL

In an unprecedented move, the U.S. Surgeon General Vivek Murthy, M.D. wrote a direct crisis letter to every prescriber of medicine in the United States. Dr. Murthy is asking every clinician to help solve the opioid epidemic. In his letter, which is part of the Turn the Tide initiative, Murthy told physicians he understood their desire to keep their patients out of pain, but it is equally important to recognize that we arrived at this place on a path paved with good intentions.

OHIO

Ohio's medical marijuana program is set to begin on September 8th. This week, the Ohio Legislature approved $1.8 million in new funding to permit the state's Medical Marijuana Controlling Board to hire new personnel and to develop a new patient registration system and database. At the same time, the Ohio Supreme Court cleared a path for attorneys in the Buckeye State's legal ethics canons to permit counseling stakeholders in the state's medical marijuana program. Ordinarily, state attorney disciplinary guidelines prohibit attorneys from practicing in an area that furthers illegal activities under the laws of the United States.

CALIFORNIA

California Workers' Compensation Institute (CWCI) launched the first in a series of Regional Score Cards to study various aspects of claims experience within eight regions of the Golden State. The CWCI study examines the last ten years in California workers' compensation results including the percentage of claims with permanent disability, attorney involvement, claim closure, prescription drugs dispensed, and comparative loss development tables.

A LABOR (OF LOVE) DAY WEEKEND

Monday is Labor Day in the United States. It is a day dedicated to the social and economic achievements of American workers and celebrates the contributions workers have made to the strength, prosperity, and well-being of our country. And, on Sunday in The Vatican, Pope Francis will canonize Mother Teresa of Calcutta, elevating her to sainthood for being a servant leader who tirelessly worked to change the world for the better, one person at time.

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