President Trump releases skinny budget to outline priorities
On May 2, the Office of Management and Budget sent President Trump’s topline budget request for fiscal year 2026 to Congress. Although these budgets generally are ignored by the House and Senate, it is still useful as an indicator of the administration’s priorities for the upcoming year. The budget reduces non-defense discretionary spending by $163 billion compared with the previous year while increasing defense and border security. NRCA continues to prioritize increased funding for Perkins Career and Technical Education State Grants and reforms that make workforce programs easier for employers to access and support the future workforce.
Department of Labor issues guidance regarding independent contractor misclassification enforcement
On May 1, the Department of Labor announced the issuance of new guidance on the enforcement of rules for determining independent contractor status under the Fair Labor Standards Act. While Trump administration officials review a final rule issued by the Biden administration in 2024 that modified the criteria for determining independent contractors (which currently is being challenged in federal court), regional officials now are directed to not apply the 2024 rule in current enforcement matters. DOL instead will rely on an updated opinion letter addressing the classification of independent contractors in various workplace settings. The agency indicates this updated enforcement will provide “greater clarity for businesses and workers navigating modern work arrangements while legal and regulatory questions are resolved.”
Department of Labor overtime rule litigation is paused
On April 29, the U.S. Court of Appeals stayed an appeal of a previous court ruling that invalidated the Department of Labor’s 2024 overtime rule, which modified regulations governing employees who are exempt from receiving overtime compensation under the Fair Labor Standards Act. The Biden administration had issued a final rule, which took effect in July 2024, but a lower court subsequently ruled it had exceeded its authority and nullified the rule. The Biden administration appealed the initial court ruling, and the latest court decision tentatively approves the Trump administration’s request to abandon the appeal while it reconsiders revising the rule. DOL indicates it will provide updates every 60 days regarding the rule’s status.
Trump administration announces self-deportation program
On May 5, the Department of Homeland Security announced a new self-deportation program that provides financial assistance for undocumented immigrants who voluntarily leave the U.S. as a means to accelerate immigration enforcement efforts. Under this program, qualifying individuals will receive financial and travel assistance, including a stipend of $1,000, to travel to their home country by using the CBP Home App. DHS notes individuals submitting their intent to voluntarily self-deport will be deprioritized for detention and removal before their departure and says participation in the self-deportation program may help preserve the option for return to the U.S. legally in the future.
