By Omar S. Nashashibi, co-founder, The Franklin Partnership, LLC
Twice a year, the US government provides manufacturers with a preview into what it has in store for them. This comes in the form of the Fall 2023 Unified Agenda of Regulatory and Deregulatory Actions, which the Biden administration released in December 2023. The Regulatory Agenda, as it is known, is a list of proposed and final rules agencies intend to release in the coming months.
The Fall 2023 Regulatory Agenda included 2,524 entries of new and potential regulations coming from virtually every agency, including some that many readers may not know even existed. As a lobbyist for AMBA and manufacturers around the US, my firm filters through regulatory agenda twice a year to help businesses anticipate how a proposed or final rule may impact their operations and industry.
Most members by now are familiar with OSHA’s activities related to a possible rule regulating indoor and outdoor workspaces when the heat index exceeds 80° F. The agency issued a draft framework for a potential rule in 2023 that would require 10- or 15-minute breaks every two hours depending on the temperature at the workstation, increased supervisor monitoring of workers, installation of temperature-monitoring equipment, engineering controls and potentially administrative controls if the shop is unable to reduce the temperature. OSHA listed in its Regulatory Agenda that it would spend January 2024 reviewing stakeholder input following the release of its draft framework as it considers releasing a proposed rule possibly later this year.
One of OSHA’s top 10 citations annually is Lock-out/Tag-out and addressing uncontrolled hazardous energy in machinery. The agency stated in the Regulatory Agenda that it plans to release a Notice of Proposed Rulemaking (NPRM) in August 2024. Depending on whether a proposed rule maintains certain exemptions, OSHA could significantly alter how thousands of manufacturers operate their machines.
The Wage and Hour Division at the Labor Department revealed that it intends to release a Final Rule in April 2024 increasing the exemption threshold for overtime pay that would make an estimated 3.6 million workers eligible for time and a half. Currently, full-time salaried employees earning below $35,568 annually are eligible. The proposed rule indicated that the Department could increase the limit to $60,209, a threshold which would take effect 60 days following publication of the final rule. A possible change this summer could impact thousands of payrolls for manufacturers across the country.
The Department of Labor already has released one of the proposed rules listed in the Regulatory Agenda – one to change the federally registered apprenticeship programs, with comments due March 18, 2024. The Biden administration is proposing to “eliminate the tripartite on-the-job training.” This would eliminate the ability to use competency-based and time-plus competency for registered apprenticeships that the Labor Department began allowing in 2008. Many manufacturers already are raising concerns that a time-only apprenticeship with 2,000 hours annually could slow the progression of apprentices, turn away potential apprentices and cause employers to drop registered apprenticeships altogether.
The EPA has among the longest sections in the Regulatory Agenda, with 119 proposed and final rules listed. This is especially notable in an election year as administrations typically work quickly to push through regulation in the event the sitting president or their party loses control of the White House.
In March 2024, the EPA listed in the Regulatory Agenda that it would issue a Final Rule for Greenhouse Gas emissions standards for heavy-duty engines and vehicles (Phase 3) and also Multi-Pollutant Emissions Standards for Model Years 2027 and Later Light-Duty and Medium-Duty Vehicles.
The next month, in April, EPA will release a Final Rule repealing former President Trump’s Affordable Clean Energy rule regulating power plant emissions. Another significant Final Rule from EPA expected in April is officially known as Secondary National Ambient Air Quality Standards (NAAQS) for Ecological Effects of Oxides of Nitrogen, Oxides of Sulfur and Particulate Matter. Thousands of manufacturers, their suppliers and customers fall under the NAAQS regulations covering emissions from their facilities.
On the supply chain side, the Departments of Defense, Transportation and others are finalizing and proposing actions to strengthen Buy American requirements as part of federal acquisition regulations. Build America Buy America (BABA) is a top personal priority for President Biden, who issued an Executive Order increasing the US content requirements for federally backed projects.
The Commerce Department could consider changes to the Manufacturing Extension Partnership program (MEPs), the process by which importers request exclusions from tariffs on steel and aluminum, and how Commerce factors in market conditions when determining antidumping and countervailing duties on imports from countries such as China.
From non-competes to corporate climate disclosures and forever chemicals, manufacturers have no shortage of regulations to track and possibly comply with coming from Washington, D.C.
The National Association of Manufacturers last year released a study showing federal regulations cost an estimated $3.079 trillion in 2022, with the annual burden for an average firm being $277,000. Smaller manufacturers bear the burden, with those having fewer than 50 employees averaging a regulatory cost of $50,100 per worker.
Regulations play a critical role in health, safety and productivity, and are an important part of what governments do in partnership with the regulated community. The goal of reviewing the Regulatory Agenda twice each year is to help businesses anticipate, and possibly adapt as necessary’ to the changing regulatory environment. While lawmakers and politicians receive the most media attention on a daily basis, it is the regulators who often have a greater impact on day-to-day operations.
Omar Nashashibi is a founding partner at The Franklin Partnership, LLC, a bipartisan government relations and lobbying firm retained by the American Mold Builders Association in Washington, D.C.
