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Employment Law Update: Do Mid-Term Election Results Foreshadow Labor Law Redirections....Again?

Executive actions taken by the current Administration have had a significant impact on many existing employer-directed laws and formal interpretive guidance issued by the Equal Employment Opportunity Commission, the U.S. Department of Labor, the National Labor Relations Board, and even the Internal Revenue Service. In general, employers seek and benefit from stability and predictability in Federal employment law. Nevertheless, the landscape of Federal employment laws has become politicized, oscillating by political party with seemingly little regard for stability or long-observed precedent. Employers are well advised that we have entered a generation of employment law volatility. Many of the current Federal agency reinterpretations may change if a new political party controls the agenda.  

By way of example, the current EEOC has eliminated the decades-old requirement for covered employers to file the “EEOC 1” annual demographic report. Regarded by seasoned EEOC administrators as a valuable enforcement aid, the filing requirement may well be resurrected if there is a political change. Most dramatically, the EEOC has not only rejected the theory of “adverse impact” discrimination, but as recently as October, rejected its guidance on questioning arrests and convictions, based upon the theory of an adverse impact on minorities.  This is so, notwithstanding longstanding Supreme Court precedent recognizing the underlying theory as a basis for establishing discriminatory conduct under federal law.  In a similar vein, the aggressive federal prohibition on DEI initiatives as discriminatory, many of which have grown out of efforts to address systemic underrepresentation, much in the same manner as disparate impact claims, will undoubtedly see a reversal if prevailing political trends continue. The exact contours of these changes are hard to pinpoint, but employers may be well advised to keep their EEO-1 and DEI program know-how on the back burner. 

So too, the NLRB, with its Administration-selected majority, has rolled back interpretations, most notably many of the past Board’s initiatives to review the handbooks of non-union employers, and aggressively bar provisions which only arguably encumber collective activity, even if not so intended or having no proven actual impact. As these issues have, historically, reflected political change, employers are well advised to keep a focus on these rules on a regular basis. 

The U.S. Department of Labor has also reflected a pro-employer shift that may prove to be temporary. For example, in June 2026, after decades of agency enforcement practice, the DOL announced that it was not empowered to impose liquidated damages on agency wage-and-hour claims settlements. A new administration may choose to resurrect language, ended by the current administration, barring non-compete agreements at a federal level.

Employers may also question the longevity of the cumbersome IRS requirement of tracking the 50% overtime Federal tax-free hours. Arising in a politicized context, the real economic benefits are quite marginal relative to the employer recordkeeping burdens. Employers may welcome the end of this program.

Employers will need a close partner in following changes likely to occur if there is a political party shift.  Please reach out to Whiteford's Labor and Employment Team for further guidance.

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