The American Jobs Act – Ten Pages To Transform Us All

By Craig McCarthy

At one 199 pages, the President’s “American Jobs Act” isn’t a particularly onerous read as far as bills out of Washington go, and for that reason at least you might want to give it a once-over.  You can find it at this link.

I’ve just spent no more than ten minutes reading the Bill That Must Be Passed, and am concerned enough to log on to Florida Political Press, because what I found in that short time was compelling enough to inspire one of my bi-annual posts to this site.

I skimmed the table of contents of the (as of yet not filed) bill and chose two sections to read: Title III, Subtitle D, Sections 371-379 (pages 129 to 134), and Section 5 (on page 6).  Let’s start with the first, which is problematic on its face, then turn to the second, which is potentially catastrophic, not explicitly but implicitly, by which I mean it might, in theory and with the help of creative appellate courts,  “fundamentally transform America”.

Sections 371-379 are titled “Prohibition of discrimination in employment on the basis of an individual’s status as unemployed“.  That’s right, the bill would add “not currently doing anything useful for money” as a protected class in the realm of employment discrimination to the ones we are used to, such as race and sex.  It states, in part, that “[i]t shall be…unlawful…for an employer to…publish in print, on the Internet, or in any other medium, an advertisement or announcement for any employee for any job that includes…any provision…indicating…that an employer will not…hire any individual for…employment…based on that individual’s status as unemployed”.  The provision also outlaws hiring decisions on the same basis.

Some might say that’s a good thing.  Why dump on the down-and-out who are otherwise qualified?  The answer is that in practice, this is a provision that primarily benefits plaintiff’s employment lawyers, as the section goes on to award attorneys’ fees and a $1000 dollar-a-day award (for days not having been hired, and that can really add up by the time you get to trial) to anyone who sues under this provision.  I’m allowed to say that since I used to be a plaintiffs’ (and also defendants’) employment lawyer.

Naturally, I thought about the impact of this on my own profession.  Visiting the classified ads on the Florida Bar website, I had my browser find the term “book”.  It took all the way to the third advertisement for attorney jobs before I read this, from a Tampa-based tax law firm:

“The position requires excellent academic credentials, strong writing, research and advocacy skills, as well as proven client development skills in the form of a portable book of business.”

The term “book of business” means that the potential employer wants someone who is currently working, with current clients, whose accounts can be ported to the employer’s firm.  This would be true if the prospective employee was employed at another firm or was “employed” as a sole practitioner.

In other words, the advertisement I just found in five seconds of searching would be illegal if the President’s bill passes.  That Tampa law firm would not be permitted to even consider if their new employee can bring existing business and clients to the firm, on the pain of paying someone without new clients to offer $1,000 a day in damages.

But enough about lawyers.  A medical practice seeking a new doctor to join would likewise not be allowed to consider whether or not the new doctor actually had any patients to bring to the table (business table, not operating).  You good readers will likely think of many other scenarios within your own work experience that would make this provision a nightmare for employers.

Now let’s turn to the second of the provisions I read in the President’s American Jobs Act.  Near the beginning, on page six, we find Section 5, titled “Wage rate and employment protection requirements.”  This one is not as explicit as what I talked about above, but is potentially far more disturbing.  It states, in part, that “all laborers…employed…on projects funded directly by or assisted in whole or in part by and through the Federal Government…shall be paid wages at rates not less than those prevailing on projects of a similar character similar in the locality as determined by the Secretary of Labor…”

I hope — no, I pray — that I’m wrong about this, but I read this provision as inviting two things.  First, that there will be a lot of litigation about what the word “assisted” means, in which it is predictable that some federal appellate court somewhere, akin to the expansive interpretation of the Commerce Clause, will find that having used a road funded in part by the federal government in order to get to a work site triggers this provision, which in turn essentially empowers Sec Labor to set wage rates.  As far as I know, the word “assisted” is not a legal term of art and can be read in the definition of normal usage, which opens a very wide door for litigation.  In what way is anyone not “assisted” every day by something that the federal government touches, at least as long as you use highways or communicate with a device regulated by the FCC?  The possibilities are endless.

Second, in non-right-to-work states at least, the “prevailing rates” will almost by definition be determined by the state of labor union contracts, having the effect that any employer who happens to employ non-union, and thus often more affordable, labor, will nonetheless be forced to accept a wage schedule handed down by the federal government commensurate with what union employees earn.  At that point, there would no longer be any incentive at all to avoid non-union labor on a cost basis (other than saying the hell with it and pushing all jobs overseas, which can’t be done on construction projects).

And thus, in a total of three sentences, America would indeed be fundamentally transformed.  Am I wrong about that possibility?

Good readers, I just wrote a thousand words of commentary on a total of ten pages of a bill that is 199 pages long.  I look forward to finding out what you can spot in the other 189 pages.

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