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Economics Employment

What a Biden presidency will mean for employment

One of the biggest differences and most immediately felt differences between a Republican and Democrat president is employment law.

So the election of Joe Biden will probably bring changes. How big the changes will be may vary based on whether Republicans win the special elections in the Georgia Senate races in early January. 

Democrats are not projected to win both Senate seats, but if they do, they will control both the House, the Senate, and the presidency. However, even if Democrats win the Georgia Senate majority they will barely have majorities. 

They can only have 4-5 defections in the House and no defections in the Senate. To put this in perspective, 39 Democrats opposed the Affordable Care Act in 2009 when they had big majorities in both the House and Senate.

More moderate Democrats such as Joe Manchin of West Virginia will be unlikely to vote in favor of some of the more liberal ideas and will be unlikely to vote to end the filibuster.

Nevertheless, here are some changes we will probably see regardless of how the Georgia senate races go:

Illegal immigration enforcement will decline

The federal government will probably back away from immigration enforcement that President Trump promoted. Donald Trump was unable to pass the legislation he wanted on immigration. Many of his actions came through executive orders, and many of them were opposed in court.

Biden said he wouldn’t tear down any border walls, but he would stop building more walls

The Trump administration had considerably increased workplace audits to ensure that employers were not hiring and employing illegal immigrants. That will probably not be nearly as much of a priority for the Biden administration.

There will almost certainly be no vote to make E-Verify, a program to ensure new hires can legally work and live in the United States, mandated nationally. Without E-Verify, it’s hard for employers to verify documents, since illegal immigrants can force documents. 

Instead, Joe Biden has supported providing a path to legalization for millions of residents living in the United States illegally and increasing the number of employment-based visas. 

Affordable Care Act, or Obamacare, will be tweaked

Joe Biden was a massive proponent of the Affordable Care Act, often called Obamacare, and he was Vice President when he helped it become the law. 

Biden said during the Democratic Primary that he disagreed with the more liberal wing of his party that wanted to offer Medicare for All. He said  it would be too expensive and prefers to instead expand the ACA.
“I want to know, how did they find $35 trillion?” he asked about Medicare for All. “What is that doing? Is it going to significantly raise taxes on the middle class?”
Biden said he would continue to require employers with at least 50 employees to continue offering health insurance. 

However, his campaign has said he proposes allowing employees to try to purchase insurance on their own on a public plan like Medicare even if their employer offers insurance. (Currently employees are not allowed to purchase Affordable Care Act insurance if their employer does offer it.)

He also supports lowering the Medicare eligibility age to 60.

Paid medical leave

Congress will be much more likely to move forward on some type of mandated paid medical leave.

Earlier in 2020, Congress passed the Families First Coronavirus Response Act, which came in response to the Covid-19 pandemic. The act would have mandated that companies offer paid leave in limited circumstances and offered tax credits for smaller companies. 

According to the Society for Human Resource Management, Biden has said he supports the FAMILY Act, which would provide workers with up to 12 weeks of partial income paid for by a payroll tax. It would be used in cases in which an employee is pregnant, adopting a child, recovering from a serious health condition, or having to take care of a family member dealing with specific health conditions.

Minimum wage
Joe Biden supports raising the federal minimum wage to $15/hr., but not immediately. The Democrat-controlled House passed a bill in 2019 that would have increased the federal minimum wage to $15/hr. by 2025. The minimum wage would gradually increase until then.
It never gained traction after that, but it might now.
The federal minimum wage now is $7.25/hr.
This may actually have a realistic change of happening, even if Republicans maintain the Senate. In November, Florida became the first state south of Maryland to pass a $15 minimum wage. The minimum wage will increase gradually and reach $15 in 2026. Before Florida, all seven states that had passed a minimum wage increase to $15/hr. had been Democrat states. The fact that Florida passed this into law, even though it was in a referendum and not through the state legislature, may indicate that there could be some support for this among moderate Republicans.
Seattle raised its minimum wage in 2014, and a 2017 University of Washington study found that it caused work hours to decline, resulting in less pay for low-wage employees.
The cost of living and wages in Seattle were already much higher than in many other parts of the country, including the Southeast and the Midwest.

Fewer contractors, more employees

Biden supported the Protecting the Right to Organize (PRO) Act, which would have made it harder for employers to classify certain workers as contractors. Workers would be assumed to be employees unless the company could prove otherwise.
Realtors, construction workers, Uber and Lyft drivers, and freelance writers are employees who have traditionally been contractors or 1099 workers and not W-2 employees.
Being a contractor or 1099 worker can bring more risks and rewards, while being an employee can provide more even wages, and potentially more benefits.
California has already implemented a similar law that would classify certain contractors as employees, and it didn’t go over well. Uber and Lyft threatened to leave California. The law was supposed to help gig workers and freelancers receive more employee benefits. But it may have had the ultimate effect of eliminating certain jobs and opportunities.
The federal law doesn’t have to go as far as what California did, but it could offer some major implications to the labor market.
The PRO Act also would make it easier for unions to organize, but at the expense of employee privacy. It passed by a narrow vote in the House with a Democratic majority, but it never made it to the Senate, and President Trump said he would have vetoed it anyway.
The Society for Human Resource Management (SHRM) opposed the legislation, saying it would violate employee privacy, allowing employee’s home addresses, cell phone numbers and landlines, and other personal information to be disclosed. It would also revoke attorney-client privilege.

Jobs

Biden’s campaign website claims to bring millions of new manufacturing jobs, green jobs, and just boost employment overall. However, it doesn’t go into detail on how it would do so.

Meanwhile, a Tax Foundation report estimates that Biden’s tax proposal would kill about 585,000 jobs. A Congressional Budget Office report estimates that raising the minimum wage could eliminate 1.3 million to possibly up to 3.7 million jobs.

The next few years will be interesting, especially as Covid-19 continues to affect virtually all aspects of our lives, including our jobs and livelihoods.

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