The federal budget has long served as the battleground for fiscal debates and national priorities. That war of words has become even more vitriolic with the economy treading water and the national debt growing. Unfortunately, President Obama’s budget proposal for 2014 only served to give both sides more ammunition in a fight that appears to have no end in sight.

With the fiscal cliff negotiations and the fallout from the sequestration impacting all levels of government, this year’s budget from the White House came later than any other in recent memory. While the budget contained a number of nods to health care, clean-tech, and cybersecurity, labor departments and administrative bodies overseeing employment disputes were the key beneficiaries of the President’s budget. The Department of Labor’s Wage & Hour division, along with everyone’s favorite board, the NLRB, are slated to receive major increases in funding if the Obama Administration has anything to say about it.

That the NLRB could see an uptick in funding after a chaotic and tumultuous year, has left the President’s budget vulnerable to a number of criticisms.  As Amanda Sonneborn of Seyfarth Shaw said on the firm’s Employer Labor Relations Blog, the White House anticipates the NLRB’s place in settling labor disputes will continue into next year:

“President Obama’s proposed fiscal year 2014 budget calls for a 2% increase in spending for the NLRB over the year before. Much of that 2% increase would go to increases in compensation and benefits costs for NLRB employees. The budget projects an additional 40 NLRB employees, for a total of 1,680 employees. The budget documents further show that the Obama Administration anticipates that the Board will receive 21,700 unfair labor practice charges and 2,700 representation case petitions. The budget estimates that the Board will require approximately an additional $6 million annually to conduct field investigations and an additional $2 million annually for hearings to address these charges and petitions.”

While the NLRB is set for an increase of 40 full-time positions, the Department of Labor’s Wage & Hour Division could see as many as 63 new full-time employees to go along with more than $16 million in additional funding. With more on how the President’s budget proposal effects the DOL, here’s another Seyfarth Shaw attorney, Alex Passantino‘s on the firm’s Wage & Hour Litigation Blog:

“Buried deep within the budget documents, beyond the questions of “stimulus funds” and “entitlement reforms,” lies the answer to the question most pressing to the readers of this blog:  “What about the Wage and Hour Division?”  The answer:  “More of the same.”

WHD’s request includes a $16 million funding increase to $243 million and 63 additional FTEs, which would bring the total number of WHD employees to 1872.  The additional funds and personnel apparently would be used to continue WHD’s “fissured industry” enforcement activities, with WHD identifying business models such as “subcontracting, franchising, temporary employment, labor suppliers, [and] independent contracting” as worthy of particular scrutiny.  WHD specifically noted its continued focus on independent contractor misclassification. “

As Ilyse Schuman noted in her post on Littler Mendelson’s Washington DC Employment Law Update, President Obama’s budget reflects the administration’s goals to grow the economy using regulations and administrative agencies. Whether that budget or, at the very least, the spirit of the budget, survives Congress is another question:

“Among other programs that would affect employers, the FY 2014 budget would provide a 10% income tax credit for small businesses that hire new employees or increase wages. Links to various portions of the budget can be found on the Office of Management and Budget’s webpage. The President’s budget proposal is subject to Congressional approval, where it will likely face opposition. The budget is, nonetheless, an important signal of the Administration’s priorities, and the proposal indicates that employers should prepare for greater enforcement and regulatory activity.”

Schuman’s post provided an in-depth look into how much money was going to agencies that oversee employment and labor.  From OSHA:

“Specifically, under the 2014 budget OSHA would receive $571 million, up from $567 million it received in 2012. Of this amount, approximately $22 million, an increase of almost $6 million, would fund the agency’s various whistleblower protection activities. OSHA is charged with enforcing the whistleblower provisions in 22 separate statutes.

Another $22 million would be used to fund the development and enforcement of safety and health standards.”

to the EEOC,:

“The EEOC would also receive a funding boost under the FY 2014 budget proposal. The amount allocated in the budget for this agency is $373 million, up from $362 million provided under 2013’s continuing resolution, and $360 million allocated in 2012. The budget states that this amount is to allow the agency to align its “staffing and funding request with the new Strategic Plan for fiscal years 2012–2016.” The budget notes that the EEOC’s priority “for agency resources continues to be litigating systemic cases and maintaining a manageable inventory of cases.””

President Obama’s budget really is indicative of the administration’s priorities.

Unfortunately or otherwise, it appears this budget proposal has little chance to be anything other than that—a proposal. Although President Obama made a series of concessions designed to appease both sides, those concessions will likely be its downfall.

Provisions advocating for different measures to adjust social security payments and cuts to Medicare spending drew harsh criticisms from the left side of the aisle, while Republicans maintain the proposed cuts were still not enough. For a look at the reception of the budget proposal we turn outside LXBN to Janet Hook and Colleen Nelson on the Wall Street Journal:

“Some of the harshest words about Mr. Obama’s budget came from the left wing of his own party, as groups representing the elderly and labor unions lashed out against his Social Security proposal, which would slow the growth of benefits by using a different inflation measure, called chained CPI, to calculate annual-cost-of living adjustments.

….

Republicans challenged the idea that the budget represents a compromise, saying it offers too little in deficit reduction and too much in tax increases.”

As Hook and Nelson note, even labor unions, who theoretically stand to gain from more powerful agencies that have taken strong pro-labor positions, took a stand against the President’s budget. The United Steelworkers, the country’s largest industrial labor union, issued a press release shortly after the budget was made public denouncing the proposal:

“President Obama’s budget proposal released today is disappointing. While we acknowledge that it does not change the Medicare eligibility age, it still targets those most vulnerable in our society. Cuts to Social Security cost-of-living adjustments (COLAs) and to Medicare programs places the burden of our nation’s debt unfairly on the back of seniors.”

With all budget proposals now on the table, the scene is set for another series of tense budget negotiations. As this proposal showed, Democrats are just as inflexible as their Congressional counterparts; unwilling to compromise on key sticking points, and unable to make the decisions necessary to reach a grand bargain. Even in the face of increased funding for regulatory bodies and raised taxes on the super-rich, the liberal wing of the President’s party is just as troublesome as the conservatives in the House and Senate. Unfortunately for their constituents, already weary from the fiscal cliff and sequestration, this likely means another round of political posturing and rhetoric at a time when most Americans are more concerned with putting food on the table.

To read more analysis from LXBN members on how the President’s budget impacts you or your clients, check out our section on the proposal.