Federal Corner
The Federal Corner is an initiative of the Florida Chamber under the Small Business Council and the Litigation & Regulatory Reform Center that tracks and engages in federal rules out of Washington, D.C., that may be problematic for Florida businesses.
Occupation Safety and Health Administration Heat Rule (Published in Federal Register; Florida Chamber Submitted Comments)
In response to the Occupational Safety and Health Administration (OSHA) proposed rule on heat illness and injury in the workplace, the Florida Chamber of Commerce and Florida Chamber Leadership Cabinet submitted formal comments on behalf of Florida businesses. The major concerns include an estimated $10 billion in increased compliance costs annually, the unintended consequences of a blanket one-size-fits-all approach as opposed to site-specific, business-led solutions, and the outsized impact on Florida’s key economic sectors.
With the change in administration, it’s expected that OSHA’s proposed heat safety rule may be scaled back or delayed. Regardless of outcome, the Florida Chamber Safety Council will continue to lead on heat safety in the workplace, providing free resources to businesses found on the heat stress prevention platform.
U.S. Treasury Benefit Ownership Information Reporting Rule (Invalidated by Federal Court)
In December 2024, a federal court in Texas halted the implementation of the Corporate Transparency Act (CTA) beneficial ownership reporting requirements by holding the CTA is
unconstitutional. Under FinCEN’s proposed rule, local businesses and their beneficial owners – the individuals who own or control the company – would have been required to report information about themselves to the U.S. Treasury. The rule aimed to fight against illegal financial activities like money laundering and terrorist financing but came with increased reporting and compliance costs for businesses.
The nationwide injunction has been appealed by the federal government and the 5th Circuit Court of Appeals will hear arguments on March 25. In the meantime, businesses can learn more about the scope of the rule and the potential requirements for businesses by visiting FinCEN’s guide to beneficial ownership information reporting here. You will also find a guide for small businesses to comply with the rule should it take effect from the U.S. Chamber here.
Department of Labor Proposed Overtime Rule (Invalidated by Federal Court; Florida Chamber Submitted Comments)
The United States Department of Labor (DOL) proposed overtime rule, which took effect on July 1, 2024, was struck down by the U.S. District Court for the Eastern District of Texas in November 2024, stating that the DOL exceeded its authority by raising the threshold too high and allowing for automatic adjustments every three years. The implementation was set to come in two phases, with the salary threshold for certain exempt employees increased to approximately $44K July 1, 2024, and jumping to nearly $59K beginning January, 1, 2025, a 69 percent increase that would have resulted in approximately four million more Americans and hundreds of thousands of Floridians becoming eligible for overtime pay.
The Florida Chamber submitted formal comments to the DOL in opposition to the proposed overtime salary threshold changes in November 2023. An almost identical proposal by the Obama Administration, at the urging of the business community, was also struck down by the same federal Texas court back in 2017.
The judge struck down both phases of the rule, setting the threshold back to the roughly $35k that was in place prior to the rule being implemented. The DOL may appeal the ruling, but the Chamber believes it is unlikely the Trump Administration will pick up the legal battle.
Basel III Endgame Rule (Federal Reserve in Process of Making Changes, Re-Proposing)
In September 2024, following advocacy from the Florida Chamber and broader business community, the Federal Reserve announced plans to revise and re-propose their “Basel III Endgame” rule, which would significantly increase capital requirements for U.S. banks, driving up the cost of capital and credit for businesses of all sizes. Small and mid-size businesses, which are vital to Florida’s economic growth, would be particularly vulnerable, due to heavier reliance on bank financing to support operations and growth. If enacted, this rule could make financing prohibitively expensive for businesses already facing a challenging economic environment. With the change in administration, further adjustments to the proposal could lead to a more balanced framework that better supports local businesses.
While intended to strengthen financial stability, the rule risks tightening credit availability and increasing borrowing costs for small businesses. Smaller, privately held companies, which represent the vast majority of U.S. businesses, could be hit hardest by higher risk weights on loans. Were this rule to be finalized as written, it would limit companies’ ability to hire, invest, and grow, ultimately affecting economic growth and employment.
Department of Labor 80/20/30 Rule (Invalidated by Federal Court; Department of Labor Withdraws Proposal)
Last month, the Department of Labor (DOL) announced they were formally withdrawing their 80/20/30 proposed rule following advocacy from the business community and a decision from the U.S. 5th Circuit Court of Appeals striking down the proposal. The ruling and subsequent withdrawal of the rule makes the issue null and void, granting a win to hospitality employers.
The 80/20/30 rule as previously proposed, amends tip credit provisions for hospitality employers which allows them to pay tipped employees less than federal minimum wage, provided the employee earns enough to make up the difference. Under the 80/20/30 rule, employers would’ve lost the ability to claim a tip credit if an employee spends more than 20 percent of their total working hours on non-tipped, direct support tasks—such as rolling silverware, setting and clearing tables, or making coffee. These tasks are considered part of the job but are not directly tipped, and exceeding this 20 percent threshold results in the loss of the tip credit for that time. The 30 percent applies, and an employer loses the tipped credit, when the time a tipped employee performs directly supporting work for a continuous period exceeds 30 minutes – regardless if this work amounts to less than 20 percent of the employee’s total work hours for the week.
Federal Trade Commission Non-Compete Rule (Invalidated by Federal Court and Under Appeal; Florida Chamber Submitted Comments)
In August 2024, a federal judge in Texas struck down the Federal Trade Commission (FTC) proposed rule that would broadly ban non-compete clauses in employment contracts, with minimal exceptions, citing concerns over the FTC’s lack of statutory authority to issue substantive rules regulating unfair methods of competition. Citing different conclusions, a Florida judge also prevented the FTC from enforcing the ban based on the “major questions” doctrine, stating that the FTC had to show it had “clear congressional authorization” to issue the ban since the rule was of “extraordinary” economic and political significance. The FTC has appealed both the Texas and Florida decisions to the 5th and 11th Circuit Court of Appeals, respectively.
The Florida Chamber believes this rule is a drastic overreach of the federal government, negatively impacts Florida businesses, and is likely unconstitutional. Prior to the period for public comment closing, the Florida Chamber submitted formal comments opposing the rule. The Florida Chamber Litigation & Regulatory Reform Center also signed a coalition letter asking the FTC to self-stay their rule while the non-compete rule is being litigated, so businesses have certainty as the court process plays out.
U.S. Department of Labor Independent Contractor Rule (In Effect)
Last year, the Department of Labor (DOL) independent contractor rule took effect, which replaces the “core factors” approach of the first Trump Administration and reimplements the Obama Administration “totality of the circumstances” test, meaning that no single factor determines the worker’s status, and all aspects of the work relationship may be considered. The Florida Chamber believes the final rule interferes in the employer-employee relationship and could result in many more workers being classified as employees as opposed to independent contractors.
The rule could have significant implications on businesses that rely on the independent contractor model, increasing costs due to the reclassification of some contractors as employees – leading to minimum wage, overtime pay, and additional benefit obligations. The rule may also lead to increased compliance costs and liability concerns due to the misclassification of workers.
Multiple business groups filed suit against the DOL’s authority to issue this ruling. Regardless of the outcome of the litigation, it is expected based on past history that the new Trump administration will reverse President Biden’s effort that made it harder for businesses to classify certain workers as independent contractors.
Occupational Safety and Health Administration Union Walkthrough Rule (In Effect, Pending Ongoing Litigation)
The Occupational Safety and Health Administration (OSHA) rule allowing workers to select a union representative to accompany OSHA inspectors walking through employers’ workplaces – regardless of whether the workplace is unionized or the representative selected by the workers is an employee of the business being inspected – took effect on May 31, 2024. The rule changes the previous requirement that the representative accompanying the OSHA inspector must be an employee and could present significant challenges for employers.
The final rule is likely to increase union participation in the inspection process and could potentially be problematic as representatives with unknown motives will now be allowed to participate in inspections of employers’ property. The rule also means sensitive information could potentially be shared with union representatives, even in non-union workplaces, which could lead to increased union participation. There have also been concerns raised that representatives may be more focused on finding violations rather than working collaboratively to improve safety.
A coalition of business leaders have filed a lawsuit challenging the OSHA rule. The Trump administration may review this rule and could potentially overturn the rule in the coming years.
If you have any questions on any of these rules or would like more information, please contact Chad Kunde at ckunde@flchamber.com.