Facing a Democrat-controlled, yet closely divided Congress, President-elect Biden will use regulations and executive orders, including new mandates on federal contractors, to quickly accomplish elements of his policy platform. With much of his legislative agenda unlikely to move quickly, even with a Democratic Senate, Mr. Biden also will use the bully pulpit to sway public opinion on priority issues to attempt to persuade Congress to act. As was the case in both previous administrations, individual companies could find themselves in the crosshairs as prominent examples of issues needing to be remedied. Expect Congressional Democrats to use the budget reconciliation process to pass key legislative priorities and to engage in widespread oversight investigations. A federal minimum wage increase is virtually certain.
The Senate will be split 50-50, with Vice President-elect Harris voting to break ties. This is only the third time in history the Upper Chamber has been evenly split, the last time being in 2001. It is possible that, as happened then, Senate Democratic Leader Chuck Schumer and Republican Leader Mitch McConnell will agree to a power sharing arrangement, in which the Democrats control what legislation is considered on the Senate floor, but committees are split 50-50. It is also possible that the polarized election season and the high stakes for Democrats controlling the White House and Congress will push Schumer to insist on Democratic majorities on all or key committees.
Expect the filibuster to remain. With a closely divided Senate, it is unlikely the Democrats will vote to change Senate rules to remove the filibuster, which requires 60 votes to cut off debate on legislation on the Senate floor. All Democrats would have to support the rules change, and Sen Joe Manchin (D-WV) has said he would not support removal.
Budget reconciliation will be a favored legislative tool. The reconciliation process allows the Senate to pass key priorities related to the budget or spending on a fast-track process with a simple majority and limited debate instead of the 60 votes required for most legislation. Reconciliation can’t be filibustered. It can be used with respect to tax increases, mandatory health care spending such as Medicare, Medicaid and elements of the Affordable Care Act, and priorities such as infrastructure spending.
A closely divided Congress will create opportunities for compromise regarding certain longstanding workplace issues including paid leave and pay equity. New committee chairs in the Senate and new House members may also create opportunities for advancing the debate towards compromises acceptable to employers. However, much of what the House will pass will be dead on arrival in the evenly split Senate even though Democrats will effectively control the chamber.
The EEOC and NLRB will retain their GOP majorities for the near future. However, President Biden will appoint new Chairs who will set the Board and Commission agendas. With Democrats in control of the Senate, Biden nominations for these key workplace agencies will move more easily. Republican support may still be required to move nominees in committee, if the parties agree to a power-sharing arrangement as discussed above. Nominees are not subject to the 60-vote threshold under Senate rules.
A frustrated legislative agenda will lead to new rules for federal contractors under executive orders and rewrites of existing regulations. The imposition of new requirements on federal contractors as a substitute for new laws for all employers will build upon a trend that accelerated in the Obama administration—with Vice President Biden often at the helm. This will especially impact the labor and employment agenda.
A more conservative judiciary will often serve as a counterbalance. The Trump administration was successful in obtaining confirmations of numerous federal judges, including a 6–3 majority on the U.S. Supreme Court. While the courts can only respond to cases brought before them, there will likely be numerous challenges to Biden administration regulatory actions and interpretations of existing laws.