HOUSTON — Laws and rules change along with every new presidential administration, and only several months into President Donald Trump’s second term, there’s already been a flurry of activity.
During a presentation at the Hospitality Law Conference on what to expect from this administration, Andria Ryan — labor attorney and partner at Fisher Phillips — said employers can expect to see some rolling back of regulations, agency opinion letters and reductions in department and agency headcounts as the Department of Government Efficiency continues its work.
As a result, many departments and boards will move to take a more educational role than a compliance role.
Chevron Doctrine reversal
The case of Loper Bright Enterprises v. Raimondo led to the U.S. Supreme Court in 2024 reversing the 40-year-old Chevron Doctrine, Ryan said. Under the prior doctrine, the courts would follow the text of a law if it was worded precisely. If the text was silent about an issue or there was ambiguity, the court would defer to the federal agency.
“There was certainly a level of stability provided by that, but it really granted a lot of power to many of these agencies,” she said.
Under the new rule, the courts will respect an agency’s authority if they’re properly delegated to to the agency, Ryan said. If not, the courts will now decide how to address that regulation. That will have a major impact on compliance with government regulations and laws.
“It gives us some new tools for pushing back against overreaching agency regulation now under the Trump administration and, of course, moving forward, which is going to be very important in the future as well,” she said.
Equal Employment Opportunity Commission
Changes to the Equal Employment Opportunity Commission will come a bit slower because the commission puts out a strategic plan every four years, and the last one was issued in 2022, Ryan said. Until 2026, it is bound by that plan and what it prioritizes.
Even so, the EEOC has now cleared the decks of many of its cases, she said. The EEOC has had many harassment and discrimination cases languishing for years waiting to be heard unless they were a high-priority case.
In the meantime, employers should look at their policies and make sure their harassment, non-discrimination and accommodation policies are in line, she said. The guidance states it is unlawful to deny employment based on gender identity, gender expression and sexual orientation. While those terms aren’t used in the Civil Rights Act of 1964, the EEOC has taken the position that discrimination on any of those bases is discrimination based on sex, which is part of Title VII of the law.
“So if an employee requests to be identified by a preferred gender, name or pronoun, it must be honored, and it might be considered harassment to not honor those,” she said.
There are legal challenges to many of these positions, including the use of gendered restrooms, but nothing is settled yet, she said.
Wage issues
Former Presidents Barack Obama and Joe Biden both tried to increase the salary threshold for exempted employees during their terms, Ryan said. The most recent attempt by the U.S. Department of Labor would have had the annual threshold increase to $43,888 effective July 1, 2024, and then $58,656 by Jan. 1, 2025. There would also be automatic increases scheduled every three years.
A federal judge in Texas issued a nationwide injunction to block this overtime rule, saying the Department of Labor exceeded its authority, she said. That means the prior threshold is still in effect.
The Trump administration is also currently arguing before the Supreme Court that a federal district court judge should not be able to issue a nationwide injunction on a case regarding an executive order ending birthright citizenship for children born to parents who enter the U.S. illegally or on a temporary visa.
The Biden administration also created a new rule regarding the tip credit employers can take for tipped minimum wage rates, Ryan said. In most states, employers can pay a tipped employee $2.13 an hour as long as tips made up the rest of the federal minimum wage of $7.25 an hour. It followed the 80-20 rule that allowed employers to take that credit so long as at least 80% of their employees’ work allowed them to earn tips.
Under the new rule, called the 80-20-30 rule, employers still had to follow the 80% rule to take the tip credit, but they could risk losing it if employees had more than 30 minutes of continuous non-tipped work, she said.
“It’s almost impossible for operators to comply with this,” she said. “Imagine trying to figure out when your bartender is doing non-tip work. They’re cleaning the silverware, servers are rolling silverware. Pre-shift work, post-shift work that was pretty easy, but during the shift, nearly impossible.”
The Fifth Circuit Court of Appeals struck down this rule, but it did not issue a nationwide injunction, she said.
Immigration enforcement
There are two federal actions that need distinguishing, Ryan said. One is the U.S. Immigration and Naturalization Service I-9 form audit. An I-9 form is used to verify the identity and employment eligibility of new hires. When INS performs an I-9 audit, it gives advance warning to allow an employer time to gather the forms and make sure they’re properly completed. If the forms are not in order, the government can fine the employer.
That is different from the U.S. Immigration and Customs Enforcement raids that are making headlines across the country, she said.
“We know that ICE has begun conducting raids and arrests on a wide scale,” she said. “Many have said they’re just arresting criminals. They are arresting a lot of criminals, hardened criminals as opposed to just immigration violators. I don’t think anybody thinks they’re going to stop there. I think we’re going to continue to see some mass deportation.”
Many employers will say they’re sure they’re in compliance and use E-Verify, but they’re not sure about their staffing agencies, she said.
“That’s a group of employees that I think the industry worries about being vulnerable to being deported,” she said.
The U.S. government has also revoked the parole status for Cubans, Haitians, Nicaraguans and Venezuelans who entered the U.S. under this program, she said. There was a preliminary injunction issued by a judge in Massachusetts that applied to some of these individuals from Venezuela, but not all of them.
Employers in the hotel industry need to know that ICE could conduct a workplace raid of their properties, and they should also know how to respond, Ryan said. They must have a judicial warrant, and if ICE arrives at a property, the hotel operator should see it to know who and/or what they are looking for.
“Make sure you know where the ICE agents are looking because the warrant says what they can do,” she said. “Are they looking to detain a specific person? Are they looking at certain employment documents? Only allow what the warrant indicates is permitted, and it needs to be signed, obviously, by a judge.”
Hotel general managers need to make sure that front-desk associates know who to call if ICE agents show up, she said. They also need to be certain everyone knows the difference between public and private areas. ICE agents are allowed to, without a warrant, walk into and stay in public areas, such as the lobby or restaurant, just like everyone else.