Build Back Better Legislative Text Includes Civil Monetary Penalties for Directors

October 29, 2021

As negotiations on the infrastructure and larger social spending bills continue among lawmakers, the House released the Build Back Better legislative text which is still subject to change as Democrats try to reach a final deal that can pass Congress.

As currently drafted, the Build Back Better framework includes the following notable provisions:

  • Civil monetary penalties (CMPs) up to $50,000 for each National Labor Relations Act (NLRA) unfair labor practice violations and up to $100,000 for repeat violation over the previous five years.

  • Personal liability and CMPs for directors or officers for NLRA unfair labor practice violations where the director or officer established a policy that led to the violation, directed or committed the violation, or had actual or constructive knowledge of and the authority to prevent the violation and failed to prevent it.

  • Substantial mental health parity civil monetary penalties for any employer health plan that violates its legal obligations.

  • Significant budget increases for labor enforcement agencies, such as the National Labor Relations Board, the U.S. Labor Department's Wage and Hour Division, and the Occupational Safety and Health Administration.

  • Increases taxes on high-income households and corporations, including a 15% minimum tax for corporations, a 1% surcharge on stock buybacks, and a 15% country-by-country minimum tax on foreign profits of U.S. corporations. The bill also includes a 5% surtax above individual income of $10 million, and an additional 3% surtax on income above $25 million. 

Federal paid family and medical leave was not included nor was a proposal to allow Medicare to negotiate lower prescription drug prices.  However, it is still possible that these proposals could be included in a final deal. 

HR Policy Association has been sharing with lawmakers that our members understand the importance of paid family and medical leave and have experience with the implementation of benefits.  Earlier this year, we urged lawmakers to consider member issues and questions related to a federal paid FMLA program.  Depending on the outcome of the Build Back Better Act, the Association will continue to work with lawmakers to find a long-term, workable solution on paid leave to complement existing employer-provided benefits. 

Similarly, the Association has been advocating in support of Chairman Wyden’s principles for drug pricing reform, which aim to lower Medicare drug prices and extend those reforms to employer plans.  As negotiations continue, we will advocate that employers should have access to Medicare-negotiated prices, if a proposal is included in a final package. 

Outlook:  Negotiations on the infrastructure and social spending bills are subject to change in the next few days.  It is possible that some of the proposals not currently included will be added to garner additional Democratic support.  According to Senate Finance Chair Ron Wyden (D-OR), “The deal is not done until the Senate acts.”