Department of Labor Issues Final Overtime Rule
USTR Releases Report on Section 301 Review
The Office of the U.S. Trade Representative (USTR) took three major actions last week – retaining the existing tariffs on imports from China, increased tariffs on targeted products, and established an exclusion process allowing importers to request temporary suspension of tariffs on 312 products appearing on the exclusion list. One Voice is seeking input from members on whether they manufacture or import any products appearing on the list, which can be found here. Contact info@onevoice.org if your company has any items of concern that are identified on the list.
USTR concluded its statutory review of the tariff actions in the Section 301 investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation. The report released by USTR on May 14, 2024, outlines the findings of the review into the effectiveness of the tariff actions as well as makes recommendations for further actions.
The four-year review examined the effectiveness of the Section 301 tariffs in countering China as well as the effects on the U.S. economy. The report concludes that the tariffs have “burdened China’s economy, imposing meaningful costs.” Not only has China’s market share of U.S. imports decreased since the imposition of the tariffs but USTR analysis found that hundreds of companies, including small and medium-sized businesses moved production capacity out of China as a direct result of the Section 301 tariff actions.
While the report finds that the 301 tariffs have impacted China, “many of the technology transfer-related acts, policies, and practices described in the original Section 301 Report persist and increasingly burden or restrict U.S. commerce.” USTR is recommending that the Section 301 tariffs remain in place as well as adding or increasing tariffs for certain products. The increased tariffs are for products in “strategic sectors,” such as those specifically targeted by China or industries where the Biden administration has been focused on making investments, like electric vehicles, semiconductors, and critical minerals.
The tariff modifications include:
- Battery parts (non-lithium-ion batteries) – Increase rate to 25% in 2024
- Electric vehicles – Increase rate to 100% in 2024
- Facemasks – Increase rate to 25% in 2024
- Lithium-ion electrical vehicle batteries – Increase rate to 25% in 2024
- Lithium-ion non-electrical vehicle batteries – Increase rate to 25% in 2026
- Medical gloves – Increase rate to 25% in 2026
- Natural graphite – Increase rate to 25% in 2026
- Other critical minerals – Increase rate to 25% in 2024
- Permanent magnets – Increase rate to 25% in 2026
- Semiconductors – Increase rate to 50% in 2025
- Ship to shore cranes – Increase rate to 25% in 2024
- Solar cells (whether or not assembled into modules) – Increase rate to 50% in 2024
- Steel and aluminum products – Increase rate to 25% in 2024
- Syringes and needles – Increase rate to 50% in 2024
In the report, USTR specifies that the over-production of steel and aluminum in China has distorted the global market harming U.S. manufacturers and that increasing the tariff rate to 25% on steel and aluminum products from China will reduce “opportunities for circumvention and help ensure the long-term viability of U.S. production.”
USTR also recommends establishing a new limited exclusion process for manufacturing machinery and automatic temporary exclusions for certain solar manufacturing equipment. The exclusion process will only apply to certain products listed under HTS Chapter 84 (Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof) and Chapter 85 (Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles).
NLRB Appeals Decision Blocking Joint Employer Rule
The National Labor Relations Board (NLRB) has appealed a federal judge’s decision in Texas to vacate a rule that broadened the criteria for establishing a joint employment relationship to include indirect and unexercised control over job terms and conditions.
On March 8, 2024, the United States District Court for the Eastern District of Texas vacated the NLRB’s “Standard for Determining Joint Employer Status” rule, stating it exceeded “the bounds of the common law” and that the NLRB “failed to reasonably address the disruptive impact” the new rule would have on various industries.
The NLRB’s appeal follows a congressional attempt to block the rule, which failed. Both the House of Representatives and the Senate passed a Congressional Review Act (CRA) measure formally disapproving the rule. However, President Biden vetoed the CRA, and the House’s vote of 214-191 fell short of the two-thirds majority needed to override the veto. Published on October 26, 2023, the final rule aimed to replace the previous standard introduced during the Trump administration, which had protected companies from shared liability in unfair labor practices and union bargaining responsibilities since April 2020. The new rule would have considered employers joint employers if they had a role in determining key aspects of employment like scheduling, wages, and benefits.
Commerce Issues Preliminary Determinations in Aluminum Extrusion AD & CVD Investigations
The US Department of Commerce (Commerce) has issued affirmative preliminary determinations in the investigations of aluminum extrusions from China, Colombia, Ecuador, India, Indonesia, Italy, Malaysia, Mexico, South Korea, Taiwan, Thailand, Turkey, the United Arab Emirates (UAE), and Vietnam. The determinations, published in the Federal Register on May 7, 2024, state that Commerce found that aluminum extrusions “are being, or are likely to be, sold in the United States at less than fair value (LTFV)” from the subject countries.
AD and CVD orders on aluminum extrusions from China have been in place since 2011 with duty rates ranging from 32.79% to 33.28% and subsidy rates ranging from 8.02% to 374.15%. This new investigation expands the scope under the existing orders to capture various additional types of aluminum extrusions.
The final determinations by Commerce for the AD and CVD investigations are expected on July 15, 2024, but Commerce has already indicated that the final determinations may be delayed until mid-September. In the preliminary determinations, Commerce set the following dumping rates:
- China – 4.91% to 376.85%
- Columbia – 8.85% to 34.47%
- Ecuador – 17.23% to 51.20%
- India – 3.44% to 39.05%
- Indonesia – 5.65% to 112.21%
- Italy – 0% to 41.67%
- Malaysia – 0% to 27.51%
- Mexico – 9.18% to 82.03%
- South Korea – 0% to 43.56%
- Taiwan – 0.73% to 67.86%
- Thailand – 2.02% to 4.04%
- Turkey – 45.41% to 594.55%
- United Arab Emirates – 9.13% to 42.29%
- Vietnam – 2.85% to 41.84%
The antidumping duties will combine with the preliminary countervailing duties assessed in March for China, Indonesia, Mexico and Turkey.
Legislators to Introduce Resolution Blocking NEPA Phase 2 Rule
Following a contentious hearing in the House of Representatives on the White House Council on Environmental Quality’s (CEQ) fiscal year 2025 budget request, Republicans in the House have indicated that they will soon introduce a Congressional Review Act (CRA) resolution to repeal the CEQ’s recent phase 2 National Environmental Policy Act (NEPA) rule.
During the May 16, 2024, hearing in the House Natural Resources Committee, Republican committee members charged that the new rule, released on May 1, fails to abide by the NEPA amendments that Congress included in the Fiscal Responsibility Act (FRA). Committee Chairman Bruce Westerman (R-AR) said that the new rule “blatantly ignores” Congress while Rep. Pete Stauber (R-MN) stated that with the finalizing of the Phase 2 rule CEQ “ignored the reforms Congress included in the FRA. Plain and simple, this administration is not following the law.”
Rep. Garret Graves (R-LA) is expected to introduce a CRA resolution blocking the rule in the House, while Sen. Joe Manchin (D-WV) has said he will do the same in the Senate. If passed, this formal disapproval under the CRA would repeal the regulation as well as prohibit the agency from issuing any rules that are “substantially the same” as the overturned regulation.