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Tuesday, March 2, 2021

Marty Walsh puts worker flexibility at risk

The peaceful transition of power is a cornerstone of American representative government for the continuity it provides.

Yet, that doesn’t make everything associated with the transition completely seamless. For workers and employers across the country, every change in administration brings new uncertainty about what new policy shifts are coming their way. It’s a sobering reminder of the impact of Washington’s power on the day-to-day lives of millions in the United States.

Over the last four years, the push at the Department of Labor has been to protect flexibility for independent contractors, commitment to working on program integrity, promoting price transparency, and other prudent labor measures. If President Biden’s pick for labor secretary, Boston Mayor Marty Walsh, gets confirmed, these priorities could be at risk.

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It’s no surprise that the self-professed “most-pro-union president you’ve ever seen” would select Walsh to head the Department of Labor. Bay Staters like myself have watched Walsh’s rise from union leader to state representative to mayor. He is going to be asked to execute the wish list of every labor union. But what’s good for New England union leaders isn’t always what’s best for the entire country.

There are at least two important areas in healthcare that the Biden administration should carry over from the Trump administration, and Walsh’s record suggests he might support them if confirmed.

First, Walsh voted to support a robust price transparency law when he was a state representative. He should keep the new federal price transparency regulations as they benefit both the average person and union members. He should know that overpaying for healthcare means fewer jobs and less money in paychecks for working Americans.

Second, as Walsh learns about association health plans, or AHPs, they will sound familiar to him as they operate in a very similar manner to a union health plan. They allow small businesses and the self-employed to pool together and access health coverage as one larger group.

Union plans operate the same way and even let self-employed union members join as “working owners.” In fact, the Trump administration expanded AHPs by looking at current rules for self-employed union members that allow them to join pension plans. If Walsh believes in level playing fields, he should keep the Trump-era AHP regulations.

But Walsh could also pull the rug out from millions of workers, as new doors that have been opened to the self-employed or people who need alternative work arrangements could be slammed shut. Before COVID-19, these flexibilities contributed to historic unemployment lows, including record hiring levels for those from traditionally underrepresented communities such as individuals with disabilities, women, and minorities. There were more jobs than workers to fill them and competitive pay in many industries, including those that don’t require a four-year degree.

The pandemic may have damaged that growth, but the Labor Department still emphasized flexibility, clarifying who was an independent contractor compared to a traditional employee and helping limit the surprise financial burden of medical procedures. Rolling these back would not bode well for businesses and workers barely hanging on during the pandemic.

Beyond that, labor unions are notoriously hostile to freelancing and other non-unionized self-employment pathways, as evidenced by California’s disastrous AB-5 law. Biden has expressed support for making this a nationwide policy. He has also called for an end of “right to work” in this country, limiting people’s ability to find work without being forced to join a union.

If history repeats itself, there is also cause for concern for states’ welfare programs. The Obama administration was inconsistent at best at cracking down on fraud. With COVID-19 and Congress flooding the states with cash to meet the demands of the newly unemployed, fraud in several states is historically high, hitting the billions of dollars in California alone. With more stimulus and “relief” to come, the country needs the Labor Department to protect resources for those who truly need them.

Walsh brings a union resume, but here is to hoping that he will focus on areas that help all workers who need flexibility, transparency, and protect limited resources.

Josh Archambault is a senior fellow at the Foundation for Government Accountability.

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