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June 2018

Pruitt faces growing opposition from conservative Republicans…

Scott Pruitt, the administrator of the Environmental Protection Agency (EPA), faces growing opposition from conservative Republicans over alleged ethical lapses and even over some of his efforts to ease environmental rules.

The latest prominent conservative to attack Pruitt is Laura Ingraham, the popular Fox News host who is considered a Trump confidant. She urged Trump to replace Pruitt, arguing that his ethical problems are wounding the president.

“He’s hurting the president because he has bad judgment after bad judgment after bad judgment,” Ingraham said. “It just doesn’t look good. If you want to drain the swamp, you got to have people in it who forgo personal benefits.”

Pruitt is facing numerous congressional and EPA investigations into his lavish spending on security and first-class travel, the use of EPA aides to handle personal business and to seek jobs or favors for his family, a sweetheart condo rental deal with a lobbyist and unauthorized raises for top aides.

Even Pruitt’s previously strong supporter and ally, Sen. Jim Inhofe, R-OK, expressed concerns about the string of ethical issues hovering over the EPA administrator. Asked about Pruitt on Ingraham’s radio show, Inhofe said “it may be time for him to go.” While not calling for Pruitt’s ouster, he suggested that EPA Deputy Administrator Andrew Wheeler, a former Inhofe aid, was qualified to run the EPA should the President decide to replace Pruitt.

Senate Energy and Natural Resources Chairwoman Lisa Murkowski, R-AK, questioned Pruitt’s request for aides to find a job for his wife with political donors. "Is there more to the story? I don’t know. Should we find out? Yeah,” she said.

Beyond his ethics problems, Pruitt faces a storm of opposition from Midwest Republicans upset over his moves to reduce requirements for oil refiners to blend corn-based ethanol into gasoline supplies. Enacted by Congress during the George W. Bush administration as a way to reduce carbon emissions from cars, the ethanol rules have long pitted Republicans from the corn-producing Midwest against oil-state Republicans, who argue that the ethanol rules unfairly raise the costs for oil refiners.

Seeking to help the oil industry, Pruitt has granted ethanol waivers to dozens of small refineries, raising the ire of farmers, who have urged Pruitt to follow through on President Trump’s campaign promises to protect them. And, they are also demanding that Pruitt follow through on Trump’s pledge to allow year-round sales of higher-percentage ethanol blends.

Iowa’s two Republican senators, Chuck Grassley and Joni Ernst, have both been highly critical of Pruitt, with Ernst calling him as "swampy as you get" and “a bad actor in so many different areas."

The conservative American Future Fund is airing a television ad in Nebraska and South Dakota blasting Pruitt's ethical problems. “Scott Pruitt is a swamp monster. Mr. President, you know what to do,” the 30-second ad says before playing a clip of Trump from "The Apprentice" reality show declaring, “You’re fired.”

Meanwhile, the conservative National Review this week joined the chorus of conservative voices calling for Pruitt to be replaced. Citing his ethical problems, the magazine said "this is no way for any public official to treat taxpayers. It also makes it practically impossible for Pruitt to make the case for the Trump administration’s environmental policies — a case that we continue to believe deserves to be made."

"It does not help that Pruitt’s conduct has left him nearly alone at the agency,” the magazine continued. “Many of his top aides have fled and paranoia seems to consume those who remain."

For his part, Trump has continued to praise Pruitt for his aggressive efforts to reverse Obama administration environmental regulations. But, acknowledging the string of ethical accusations facing Pruitt, Trump recently said "I'm not saying that he's blameless, but we'll see what happens."

GOP gives Trump free reign on tariffs, but opposes deals with Chinese tech firms…

Even as President Trump is discarding decades of Republican trade policy with punishing tariffs against our closest allies, he faces only token criticism from congressional Republicans. But his efforts to ease sanctions on two huge Chinese technology companies accused of trading with Iran and North Korea face strong opposition in Congress.

Washington insiders have watched with some wonder as congressional Republicans have raised only token opposition to the president’s aggressive efforts to impose tariffs on our major trading partners. Trump’s policies threaten a trade war as China and our closest allies move to retaliate with tariffs on U.S. goods.

Republican leaders in Congress have shied away from confronting Trump over these policies even though they run against the party’s long support for free trade. Instead, they have sought to convince him to back down from his most aggressive trade policies. A fledging effort to pass legislation giving Congress veto power of tariff decisions appears doomed as both House and Senate leaders say it would face a certain presidential veto.

The only substantial GOP opposition to Trump trade policies appears centered on his moves to exempt ZTE, a large Chinese technology company, from crippling trade sanctions. Senate Republicans are now setting their sights on another Chinese company, Huawei — the world's third-largest seller of smartphones behind Samsung and Apple.

Trump initially imposed the sanctions on ZTE after the Commerce Department found the company sending American-made components to Iran and North Korea and banned ZTE from buying U.S. components for seven years. But the Commerce Department relented earlier this month after ZTE offered to pay a $1 billion fine, replace its top management and allow oversight by U.S. appointed regulators.

That reversal faces strong opposition in Congress, where legislation is pending that would ban any federal agency from purchasing products from either ZTE or Huawei.

High court supports class-action waivers, avoids a binding decision on gay rights…

In a long-awaited decision, the U.S. Supreme Court has ruled 5-4 that class action waivers in employment agreements are enforceable, making clear that businesses can require employees to resolve disputes with their employer through individualized arbitration rather than though class action or other collective legal proceedings.

In another intensely watched case, the court supported the right of a Colorado baker to refuse on religious grounds to bake a wedding cake for a same-sex couple. The justices based their 7-2 decision on violations of the baker’s rights by the state commission which originally ruled against him. The court’s 7-2 decision effectively put off for another day a ruling on the larger issue of whether a business could refuse services to gays based on religious beliefs.

The class-action waiver resolved questions that have divided the lower courts: Do contracts that require employees to waive their rights to file class action lawsuits violate the National Labor Relations Act (NLRA) protection for employees to engage in concerted activities? Or does the Federal Arbitration Act (FAA) mandate requiring that such arbitration agreements be enforced supersede the labor law?

The high court found that nothing in the labor law overrules the mandate in the arbitration law, and the decision included language that heavily favors the enforceability of arbitration agreements in general.

EPA moves to revise Obama administration’s Risk Management Program rules…

The U.S. Environmental Protection Agency (EPA) has proposed rescinding most of the amendments to the Risk Management Program (RMP), that were finalized in the waning days of the Obama administration.

Any facility that uses hazardous materials is required under the 1990 Clean Air Act to develop an RMP for response to emergencies. Following the 2013 explosion at a Texas fertilizer plant that killed 15 people, President Obama directed government agencies to improve safety at chemical facilities.

EPA finalized its RMP amendments on Jan. 13, 2017, one week before President Trump took office. Those amendments were scheduled to go into effect in March of last year, but they have been delayed twice and now are not scheduled to take effect next February.

The EPA’s new plan would entirely rescind amendments on safer technology and alternative analyses, third-party audits, incident investigations and availability of public information about hazardous sites. In addition, EPA is proposing to modify amendments regarding local emergency coordination, emergency exercises and public meetings. It also wants to change the compliance dates for those amendments.

The agency says that the Obama requirements for information disclosure pose potential security risks and impose unnecessary costs. EPA also says that EPA failed to coordinate its earlier rulemaking with the Occupational Safety and Health Administration (OSHA), which has primary federal responsibility for workplace safety.

The EPA states that its proposed rule would result in annualized cost savings to industry of approximately $88 million.

The proposal comes at a time when there are already court challenges to EPA’s actions to delay the effective date of the RMP Amendments and to revise the rule. It is expected that the latest proposed changes will meet with substantial comments and strong opposition, particularly from environmental groups and unions.

NLRB issues new, employer-friendly guidance on workplace rules…

National Labor Relations Board (NLRB) General Counsel Peter Robb has issued broad guidance on employee handbook rules that is in stark contrast to the guidance offered by his Obama-appointed predecessor.

These new policies illustrate the dramatic change in direction from the pro-employee NLRB with a majority appointed by President Obama compared to the current pro-business board, whose majority was named by President Trump.

Robb, a former employer-side lawyer who serves as the Board’s chief prosecutor and is instrumental in determining the policies of the NLRB as a whole, issued a detailed, 20-page memorandum outlining his views on the legality or illegality of employee handbook rules in light of the Board’s decision last December in a case involving the Boeing Company.

Under prior NLRB policy, the Board rejected any workplace rule that could be “reasonably construed” by an employee to prohibit the exercise of his rights under the National Labor Relations Act (NLRA). In the Boeing decision, the new Board said that even a workplace rule that might reasonably be seen as interfering with a worker’s rights must face two additional tests: the nature and extent of the potential impact on rights protected by the NLRA and any legitimate justifications for imposing the rule.

The second test swung the pendulum in favor of employers, whose reasons for imposing workplace rules were often given short shrift by the prior board.

Robb’s memo reversed or substantially revised similar guidance issued by former NLRB General Counsel Richard Griffin Jr., who was appointed by President Obama. Griffin’s policies led to numerous NLRB decisions on workplace rules that favored employees and unions.

The Boeing decision set forth three categories of workplace rules: (1) rules that are generally lawful to maintain; (2) rules that require case-by-case consideration to determine if they are lawful; and (3) rules that are unlawful by their nature. In his memo, Robb specifies the types of rules that fall into each category:

Lawful rules include many rules that the NLRB previously found unlawful, including those related to civility, insubordination, disruptive behavior, insubordination, non-cooperation, or on-the-job conduct that adversely affects operations, protecting confidential, proprietary, and customer information or documents, prohibiting defamation or misrepresentation, prohibiting use of employer logos and trademarks, requiring authorization to speak for the company; and banning disloyalty, nepotism, or self-enrichment.

Rules that warrant individual scrutiny include broad conflict-of-interest rules that do not specifically target fraud and self-enrichment, confidentiality rules broadly encompassing “employer business” or “employee information,” rules regarding disparagement or criticism of the employer as opposed to civility rules regarding the disparagement of employees, rules regulating use of the employer’s name (as opposed to logo/trademark), and rules generally restricting speaking to the media or third parties. This second category also includes banning off-duty conduct that might harm the employer and rules against making false or inaccurate statements.

Unlawful rules are those that require confidentiality with respect to wages, benefits, or other working conditions and those that prohibit joining outside organizations or voting on matters concerning employers.

Trump’s “zero tolerance” policy may force Congress to act on immigration…

President Trump’s policy of separating children from adults caught illegally crossing the southern border may end the long stalemate in Congress over competing proposals to update the nation’s immigration laws.

The public outcry over thousands of children being separated from their families may force GOP leaders to find a compromise immigration bill that Trump will sign. And the issue of the “orphaned” children may even lead to a compromise over the “dreamers,” immigrants already living here who were brought to the U.S. illegally as children.

Unless the leadership can come up with a compromise plan, the House is expected to vote shortly on two competing immigration reform proposals—one a compromise plan put together by moderate and conservative Republicans and the other a more restrictive plan offered by the most conservative wing of the party.

Both plans would clarify the treatment of the “dreamers” while also permitting children apprehended at the border to remain with their families. And, both would provide some money for the president’s proposed wall along the southern border, although not as much as Trump is requesting.

The White House has said that Trump will sign either bill.

In the Senate, Majority Leader Mitch McConnell, R-KY, has pledged to block any immigration bill unless the House acts first. And even then, he is withholding any promise to permit a Senate vote.

Politicians on both sides of the aisle are feeling public pressure mount as more than 2,000 children have been separated from their families in the past six weeks. And first lady Melania Trump added to the pressure with a letter urging “both sides of the aisle” to “finally come together to achieve successful immigration reform. Long-time Trump advisor Kelly Ann Conway said publicly that “nobody likes this policy.”