Labor Law Fines, Billions for Child Care, Pre-K in Budget Bill

  • Bill would penalize employers for labor law violations
  • $726 billion includes college costs, school infrastructure

(Updates with details on labor enforcement proposals, in paragraphs 7, 16, and 17.)

House Democrats want to spend $450 billion to make child care more affordable and pre-kindergarten universal, as well as impose substantial employer penalties for labor law violations.

The package, proposed Wednesday, also includes tens of billions in new spending for free community college, school infrastructure, child nutrition, and worker training. The House Education and Labor Committee plans to begin marking up the more the $761 billion package Thursday.

The unprecedented proposal for early childhood makes up one of the largest pieces of a $3.5 trillion expansion of the social safety net President Joe Biden is seeking. The committee bill offers about one-third of the $1,475 increase in Pell Grants proposed by the White House.

The committee also would hand unions a major win on a top priority by including substantial penalties for violations of the National Labor Relations Act. That’s a key provision of the PRO Act (H.R. 842), a sweeping measure to overhaul labor law and expand workers’ rights to organize. It faces tough hurdles in the Senate as free-standing legislation.

The PRO Act would give the National Labor Relations Board the authority to levy fines of as much as $50,000 per labor violation and $100,000 for repeat offenders, on top of damages for workers. The committee proposal retains the $50,000 fine cap and allows for $100,000 fines if the violation resulted in an employee getting fired.

Democrats’ Budget Deal Seeks to Penalize Labor Law Violators

Democratic leaders instructed committees to assemble their parts of the spending package by mid-September. They plan to pass the legislation through a process known as reconciliation, which would allow it to clear the Senate without Republican support but require the caucus to remain unified.

Photographer: Al Drago/Bloomberg
Rep. Bobby Scott (D-Va.) is the chair of the House Education and Labor Committee.

The panel’s proposal also seeks to overhaul the labor enforcement landscape, giving the U.S. Labor Department a much more muscular presence over the next five years, with funding to hire investigators to review businesses for wage, safety, and discrimination violations—and hire more lawyers to prosecute cases.

Child Care, Pre-K

The proposal would provide money to expand child-care options in the U.S. and cap the cost of care at 7% of a family’s income. The lowest-earning families would become eligible for free child care. The wages of child care workers would also receive a boost.

Families would get the option to send all 3- and 4-year-old children to pre-kindergarten programs through new federal spending. Democrats and the Biden administration argue that the loss of affordable child care options during the Covid-19 pandemic means that women have been slower to rejoin the labor market, curbing the economic recovery.

College Costs

The bill would spend $111 billion on measures to reduce the cost of college. The bulk of the new funding would be used to make the first two years of community college tuition free, a campaign pledge of President Biden.

The measure would give states incentives to opt into the program by covering 100% of the costs with federal funds in the first year and slowly bumping up the state’s required share of costs in subsequent years.

The bill calls for increasing the maximum value of the Pell Grant for low-income students by $500, roughly one-third of the boost proposed by the White House. The maximum Pell Grant award for the 2021-2022 school year is $6,495. College aid advocates made a push to double the maximum value of the grant in recent months.

School Buildings, Child Hunger

The spending plan would tackle longstanding concerns in K-12 schools that were put under a microscope by the pandemic.

School buildings that have fallen into disrepair across the country would get $82 billion. Champions of the proposed funding, including Rep. Bobby Scott (D-Va.), the chair of the Education and Labor Committee, said before the 2020 lockdown that poor ventilation and malfunctioning heating and air conditioning systems created unsafe learning conditions.

Covid Exposes School Ills, Fueling Ambitious Biden Spending Push

Democrats are also seeking to extend through 2029 new summer child nutrition benefits created in response to the pandemic.

Labor Enforcement

For the Labor Department’s wage-hour and occupational safety divisions, the proposal would hand investigators a heavier stick to deter noncompliance—a significant boost in the maximum penalties agencies can assess when employers short workers on pay or expose them to dangerous work conditions.

The subagencies to receive the largest enforcement budget boosts through Sept. 30, 2026 include the Occupational Safety and Health Administration ($707 million), Wage and Hour Division ($405 million), Office of Federal Contract Compliance Programs ($201 million), and Solicitor’s Office ($176 million).

All of those totals would come on top of any funding provided through the regular annual appropriations process.

Workers

The spending plan includes $80 billion for workforce training that’s long been underfunded, including an expansion of registered apprenticeships.

Democrats are looking for ways to help employees who face obstacles organizing in their workplace. In recent weeks, they zeroed in on creating monetary penalties from the NLRB as a key piece of the PRO Act that could be advanced via reconciliation.

Labor groups for months have pushed for passage of the broader PRO Act, which would also lower barriers to forming unions and securing contracts with employers. The legislation passed the House in March but stalled in the Senate.

Unions say they’re still angling for the bigger bill to be approved in its entirety, but that adding monetary penalties via the reconciliation package would still be a major victory for workers looking to organize.

—With assistance from Ben Penn and Bruce Rolfsen

To contact the reporter on this story: Andrew Kreighbaum in Washington at akreighbaum@bgov.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloombergindustry.com; Robin Meszoly at rmeszoly@bgov.com

Top