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This Week in Congress
NFIB and CDW Files Suit Over Right to Unionize NLRB Workplace Posting Requirement
Senate Approves Legislation Renewing General System of Preferences
Deadline for Comments on OSHA’s Revision of Reporting Rules Extended 30 Days
EPA Proposing to Limit Use of HBCD in Consumer Applications
New Voluntary Worker Classification Settlement Announced by IRS
Poll: Small Businesses Favor 60 MPG Fuel Economy Standard
Congress Unveils Bicameral Effort to Hold Federal Agencies More Accountable
International Trade Administration Announces Trade Mission to Russia for U.S. Automotive Parts and Components Business Development
AAIA State Issues
This Week in Congress
While Congress had planned to be in recess this week, the Senate and House will need to pass legislation to provide funding for the federal government by Sept. 30 when the current fiscal year ends. A bill to provide short-term appropriations was rejected by the Senate late last week and Senators plan to meet today to develop a compromise measure that might be able to avert a government shutdown.
NFIB and CDW Files Suit Over Right to Unionize NLRB Workplace Posting Requirement
The Coalition for a Democratic Workforce (CDW), of which AAIA is a member, the National Association of Manufacturers (NAM) and the National Federation of Independent Business (NFIB) have filed lawsuits challenging a National Labor Relations Board (NLRB) “Notice Posting Rule” that requires private-sector employers to post a notice in their business informing employees of their right to unionize; failure to do so will constitute an independent “unfair labor practice” that subjects businesses to increased scrutiny, likelihood of investigation and an indefinite expansion of the statute of limitations for filing any other unfair labor practice charge.
“With this latest rule, NLRB has gone too far, passing a mandate that vastly exceeds its authority – largely at the cost of the small-business community,” said Karen Harned, executive director, NFIB’s Small Business Legal Center.
“Job creators from across America have recognized the importance of this issue and are taking action,” said CDW chairman Geoffrey Burr. “The Coalition for a Democratic Workplace represents every industry in every Congressional district and joining this important lawsuit should signal the common concern that this will only distract job creators from their efforts to get our economy moving again.”
CDW, NAM and NFIB believe that NLRB’s promulgation of the new rule is a gross overreach of its statutory authority under the National Labor Relations Act (NLRA). Moreover, the rule, which takes effect on Nov. 14, 2011, will impact employers with no history of NLRA violations. According to NFIB’s estimates, the rule will impact up to six million private-sector businesses around the country.
The lawsuits ask the court to set aside the rule and declare that NLRB’s action violates NLRA. A copy of the CDW lawsuit can be found by clicking here.
Senate Approves Legislation Renewing General System of Preferences
The Senate approved legislation on Sept. 22 that would extend the Generalized System of Preferences (GSP) through August 2013. GSP, which had expired late last year, provides preferential duty-free entry for eligible goods from developing countries and is used by many aftermarket companies.
The legislation to renew GSP was added on the Senate floor to House-passed legislation that renewed expired portions of the Trade Adjustment Assistance (TAA) program. TAA provides assistance to workers who have lost their jobs due to international trade. The program was expanded in 2009 to provide benefits to service workers who were adversely impacted by trade with countries that do not have free trade agreements (FTAs) with the U.S., but that expansion expired last year.
The Senate-amended bill now must go back to the House for consideration. However, Senators hope that passage of TAA will cause the president to send over for their consideration FTAs with Columbia, South Korea and Panama. The administration has thus far held up consideration of the widely supported FTAs, demanding that TAA renewal must be part of any FTA consideration.
Deadline for Comments on OSHA’s Revision of Reporting Rules Extended 30 Days
The Occupational Safety and Health Administration (OSHA) approved a request from AAIA to extend the comment period by 30 days to Oct. 20 for a proposed regulation that would eliminate an exemption now provided to automotive parts stores from filing workplace injury reports, OSHA Forms 300 and 300A. The new listing was attributed to the agency’s determination that based on days away, restricted or transferred (DART) rates for 2007-2009, the parts and tire stores had average lost workday incident (LWDI) rates above 75 percent of the overall private sector annual LWDI rate.
In addition to parts retailers and tire stores, new car dealers would lose their exemption if the proposal is finalized. The proposed rule would also require these industries to report to OSHA, within eight hours, all work-related fatalities and all work-related in-patient hospitalizations; and within 24 hours, all work-related amputations. The current rule compels industries to only report to OSHA, within eight hours, all work-related fatalities and in-patient hospitalizations of three or more employees. Thus, not only would automotive parts and tires stores be newly required to file workplace injury forms with OSHA, but also be subject to the strictest injury reporting regulations ever imposed on American businesses. According to OSHA, compliance with the new requirements would cost automotive parts and tire stores a total of $25,000 per year ($60 per establishment).
AAIA is calling on OSHA to provide additional data on injury rates for parts and tire stores during the extension in order to more closely examine why the injury rates placed them outside the exemption. The original proposed rule can be found at http://www.gpo.gov/fdsys/pkg/FR-2011-06-22/pdf/2011-15277.pdf.
EPA Proposing to Limit Use of HBCD in Consumer Applications
The U.S. Environmental Protection Agency (EPA) has submitted a proposed rule to the Office of Management and Budget that would require the agency to review any new uses of hexabromocyclododecane (HBCD) in consumer goods. HBCD is currently used to produce flame retardants and is found in many fabrics, including automotive seating. The agency is contending that based on animal testing, HBCD could harm reproductive, developmental and neurological systems in humans.
Currently, the agency believes that HBCD is only being used in commercial applications. Therefore, the agency is proposing to require that any use in consumer goods would constitute a significant new use and therefore would require a review under the Toxic Substances Control Act (TSCA). If finalized, companies that want to use, produce or import HBCD for textiles designed for consumer products would need to notify the agency at least 90 days in advance. EPA would be required to evaluate the use and determine whether it posed an unreasonable risk to humans or the environment.
For additional information on the rulemaking, visit http://www.epa.gov/oppt/existingchemicals/pubs/actionplans/hbcd.html.
New Voluntary Worker Classification Settlement Announced by IRS
The Internal Revenue Service (IRS) on Sept. 21 provided the details of a new Voluntary Classification Settlement Program (VCSP) that will provide partial relief from federal employment taxes for eligible employers who choose to voluntarily reclassify their employees.
There has been long-standing confusion and disagreement over whether a worker is performing services as an employee or as an independent contractor, depending upon the interpretation of the circumstances. There is currently a Classification Settlement Program (CSP), which is available during an IRS audit process. IRS has determined that it would be beneficial to provide taxpayers with a program that allows for voluntary reclassification of workers as employees outside of the examination context and without the need to go through normal administrative correction procedures applicable to employment taxes. In order to qualify:
- A taxpayer must have filed all required Forms 1099 for the workers for the previous three years.
- Cannot currently be under audit by the IRS.
- Cannot be currently under audit concerning the classification of the workers by the Department of Labor or by a state government agency.
Additionally, a taxpayer who was previously audited by IRS or the Department of Labor concerning the classification of the workers will only be eligible if the taxpayer has complied with the results of that audit.
Taxpayers participating in VCSP must agree to treat the class of workers as employees and, in return, will only be liable for 10 percent of the employment tax liability that may have been due on compensation paid to the workers for the most recent tax year. They will not be liable for any interest and penalties on the liability, and will not be subject to an employment tax audit with respect to the worker classification of the workers for prior years.
For more details and information on the application process, visit http://www.irs.gov/formspubs/article/0,,id=242970,00.html.
Poll: Small Businesses Favor 60 MPG Fuel Economy Standard
According to a Sept. 20 poll conducted by the Small Business Majority, 80 percent of small businesses support increasing the fuel economy requirements to 60 miles per gallon (mpg) by 2025. This finding was part of a larger study assessing the position of small businesses toward clean energy initiatives. When asked about the Obama administration’s July 29 announcement proposing corporate average fuel economy standards of 54.5 mpg by 2025, the vast majority of small businesses favored a higher standard as a means to further cut their energy costs.
Other findings from the study were equally interesting. Eighty-seven percent of respondents supported the notion of increasing fuel standards now, 73 percent maintained that the government should do more to force automakers to innovate, and 71 percent were of the opinion that these automakers are not doing enough to innovate. In response to greenhouse gas emission standards being tacked on to the new fuel economy requirements, 76 percent of small businesses approved of EPA’s initiative to create these standards under the Clean Air Act. Despite these findings, 86 percent still do not view the federal government as an ally or believe that it understands their needs. Of the 1,257 businesses polled in this study, only 3 percent were in the transportation sector.
Congress Unveils Bicameral Effort to Hold Federal Agencies More Accountable
The Regulatory Accountability Act, introduced on Sept. 22 by Sen. Rob Portman, R-Ohio, and Mark Pryor, D-Ark., will force federal agencies that issue regulations impacting businesses to provide justification for these rules in the form of a cost-benefit analysis. The bill will also require that these agencies subject themselves to increased input from businesses on the overall regulatory process. While some Senate Democrats have shown support for a revamp of the federal regulatory process, chairman Joseph Lieberman, I-Conn., of the Homeland Security and Governmental Affairs Committee, expects an uphill battle in garnering enough Democratic support for passage of any regulatory reform measure. Rep. Lamar Smith, R-Texas, of the Judiciary Committee, introduced a similar bill in the House – Jobs, Growth and Regulatory Accountability Act, which would also require federal agencies to justify the costs of implementing new regulations.
Key components of these bills include providing more options for businesses to challenge federal regulations in court, requiring agencies to issue cost-benefit analyses of each rule and other “burden-reducing” initiatives.
In January, President Obama issued Executive Order 13563, which would require federal agencies to participate in ongoing “look-back” processes in which they would review existing regulations and attempt to eliminate unnecessary ones, thereby cutting costs and lessening burdens on businesses. The administration admits that it is aware of regulatory problems and has promised to ensure that its agencies become more efficient; however, some environmental regulations endorsed by the administration are under constant attack by Republicans demanding firmer checks on EPA.
International Trade Administration Announces Trade Mission to Russia for U.S. Automotive Parts and Components Business Development
A senior Commerce Department official will lead a diverse cross-section of companies selling goods and services in the automotive sector to Moscow, St. Petersburg and Samara, Russia on April 23-28, 2012. The mission will provide an opportunity for interested businesses to engage with Russia’s rapidly expanding car and truck assembly market.
The trade mission will be conducting site visits to automotive assembly plants and component manufacturers; presenting market briefings by industry experts; and setting up meetings with key Russian government officials and one-on-one meetings with potential business partners. Targeted automotive sectors include:
- Components for vehicle manufacture
- Replacement parts
- Aftermarket products
- Repair equipment
- Capital equipment used for vehicle manufacture
- Testing equipment
- Software and engineering services
Russia has more than 140 million consumers, a growing middle class and remains one of the most promising markets for U.S. exporters. Russian customers purchased 1.9 million cars in 2010 and importers have been forecasting growth of approximately 20 percent on 2011. This trend has led most experts to predict that Russia will be the largest automotive market in Europe in the next few years.
Ford opened its first plant in Russia in 2002 and General Motors is in a joint venture with the Russian auto giant AvtoVaz. In addition, Nissan, Toyota and Hyundai have opened new plants between 2007 and 2009. The U.S. Commercial Service strongly believes in the opportunities for growth and expansion in Russia for U.S. manufacturers of automotive parts and components. It is understood that Russians are prepared to pay for quality vehicles and that the Russian automotive manufacturers, along with the Russian government, are seeking technology and business partnerships to best serve this growing demand.
For full details of the mission, including the application process and costs, visit http://www.gpo.gov/fdsys/pkg/FR-2011-09-22/pdf/2011-24290.pdf. AAIA members interested in participating in the trade mission should e-mail Sheryl Wilkerson at sheryl.wilkerson@aftermarket.org.
AAIA State Issues
There are three states, D.C., Puerto Rico and U.S. in Regular Session. There are four states in Special Session. Legislation that has been newly introduced since Monday, Sept. 19, will be indicated by a “*,” while legislation that has seen new activity in the last week will be indicated by a “+.” In addition to legislation, the state issue report now includes a listing of state regulations impacting the automotive aftermarket. This week’s AAIA State Issues is available at http://www.aftermarket.org/Government/StateIssues/State-Report-09-26-11.aspx. If you have any questions or know of legislation that you would like to see included in the report, e-mail govaffairs@aftermarket.org.
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