Midterm Election Results Will Produce Host of Proposed Laws

The midterm elections will transform employment law debates at the federal and state level, with a host of proposed laws likely in Congress and new laws in many states.

Democrats now have trifectas — control of the governors’ offices and both chambers of the legislatures — in Arizona, Michigan, Minnesota, Pennsylvania, and Wisconsin, noted Alexander MacDonald, co-chair of Littler’s Workplace Policy Institute in Washington, D.C.  

“We expect these states to pass a lot of legislation, including labor and employment legislation,” he said. “Likely areas of activity include noncompete bans, paid leave, minimum wage, and pro-union legislation like tripartite regulatory boards. These states will be busy, and so will employers.”

At the federal level, even with big majorities, congressional Democrats will still need to work with President Donald Trump to move legislation forward, MacDonald added.

“Compromise isn’t impossible,” he said. Divided government can sometimes produce labor and employment bills, like the minimum wage bill President George W. Bush signed in 2007. 

However, most of what gets introduced in the next two years will be messaging bills, MacDonald predicted — bills that “Democrats will use to build their case for a mandate in 2028 and beyond.”

Workplace Issues Now on the Table

Workplace issues now on the table at the federal level, according to Scott Ruygrok, an attorney with Jackson Lewis in Irvine, Calif., include:

• Labor-friendly efforts. 
• Pay and leave. 
• Artificial intelligence in the workplace. 

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Labor-Friendly Efforts

“We expect Democrats to revisit broad union-organizing reforms like the PRO [Protecting the Right to Organize] Act, and to make another run at the Faster Labor Contracts Act, which would put newly unionized employers on a fast track to a first [union] contract,” Ruygrok said.

The Faster Labor Contracts Act would require newly unionized employers to start bargaining within 10 days of a union’s request. If the parties cannot reach agreement, the bargaining goes to mediation and then binding arbitration.

“The concern we hear from employers and clients is an arbitration panel setting terms the business just can’t afford,” Ruygrok said.

Pay and Leave Initiatives

Pay and leave initiatives may include a higher federal minimum wage, paid sick leave, and some form of national paid family leave, such as the More Paid Leave for More Americans Act. “Voters seem to have been focused on cost of living this cycle, so we think a lot of this will be pitched as affordability,” Ruygrok said.

“A federal paid leave law would mean reworking leave programs again, and leave is already one of the hardest things HR manages right now,” he said.

It could also prompt states with existing paid leave benefits, such as California, to expand those benefits to remain more generous than the federal program.

In addition, Ruygrok noted that employers are seeing more mental health-related leave requests.

Many companies “are struggling with employees stacking different types of leave,” he said. “A new federal entitlement would just add one more layer.”

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AI Proposals

Ruygrok said that “Democrats have been interested in how employers use AI tools in hiring, evaluating, and monitoring employees, and we expect hearings and a federal version of California’s No Robo Bosses Act.”

He anticipates more requirements being proposed for human review of automated decisions, impact assessments, vendor audits, and notice obligations to employees.

Odds of Enactment 

At the federal level, for the big partisan bills, the odds of enactment seem low, Ruygrok said.

“Without broad bipartisan support, those bills are unlikely to get through the Senate or a veto,” he added. “Where we see the most potential is narrower, worker-friendly bills that already have support from both parties.” 

The focus will be on whether President Trump signs those bills, not whether Congress can override any vetoes, Ruygrok predicted.

During the upcoming lame-duck session of Congress, the Faster Labor Contracts Act will be the most likely piece of legislation to make its way through Congress, as it already has support from both parties in the House and the Senate, Ruygrok said.

“Also watch out for the More Paid Leave for More Americans Act,” he added. “It has bipartisan backing and would provide grants to support qualifying state paid leave programs rather than directly imposing a new federal paid leave mandate on employers.”

However, he said, employers could, depending on the state program, still face contribution or administrative requirements. “Even if employers do not directly pay the benefits, wage replacement can make it financially possible for employees to take statutory leave they otherwise would not take, which increases the leave use and staffing burdens,” Ruygrok stated.

The American Franchise Act could narrow joint employer liability for franchisors, he noted. But this act “likely would need to get attached to something” during the lame-duck session, Ruygrok remarked. “The lame duck is already packed with funding deadlines, so we don’t expect much action for stand-alone workplace bills.”