Beltway Buzz, August 8, 2025

Congress: See You in September. Things will be a bit quieter in Washington, D.C., in the coming weeks, as members of the U.S. Congress are currently home for the August recess. Lawmakers are expected to return to Capitol Hill on September 2, 2025. Upon their return, Republicans will focus on confirming President Donald Trump’s executive and judicial branch nominees. Additionally, Congress will need to work on legislation to fund the federal government beyond the current September 30, 2025, deadline. In other words, readers should prepare for multiple Buzz updates relating to continuing resolutions and potential government shutdowns.

Lucas Confirmed. Shortly before heading home for recess, the U.S. Senate confirmed the nomination of Andrea Lucas, on a 52–45 party-line vote, for another term on the U.S. Equal Employment Opportunity Commission. Currently serving as acting chair of the Commission, Lucas’s new term will expire on July 1, 2030. As a reminder, President Trump has nominated Brittany Panuccio to fill one of the three vacancies on the Commission. Panuccio’s nomination awaits a vote on the Senate floor, and her confirmation would restore a functioning quorum to the Commission.

DOJ Issues Memo on DEI and Discrimination. On July 29, 2025, Attorney General Pam Bondi issued a memorandum to all federal agencies, titled, “Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination.” While the guidance is directed toward public and private entities receiving federal funds, it may be helpful to all employers as it provides insights into the administration’s views on workplace discrimination relating to diversity, equity, and inclusion (DEI). The guidance contains “non-binding suggestions to help entities comply with federal antidiscrimination laws and avoid legal pitfalls.” It focuses on four areas that the U.S. Department of Justice (DOJ) states are unlawful: granting preferential treatment based on protected characteristics (e.g., scholarships, internships, mentorships, etc., exclusively available to a specific racial group); use of proxies or neutral criteria that serve as substitutes for consideration or protected characteristics (e.g., recruitment strategies that focus on a specific geographic areas or institutions, primarily because of their racial composition rather than other legitimate factors); segregation based on protected characteristics (e.g., race-based training sessions, mandating representation of specific groups in candidate pools); and training programs that promote discrimination or hostile environments (e.g., race-based training or training that stereotypes individuals based on protected characteristics). Nonnie L. Shivers has more details.

NLRB Acting GC Clarifies Deferral Policy. On August 7, 2025, William Cowen, acting general counsel for the National Labor Relations Board (NLRB), issued a memorandum to the Board’s regional offices, titled, “Guidance for Deferring Unfair Labor Practice Cases.” Cowen writes, “At a time when we face decreasing staffing levels and a steady case intake, it is imperative that we maximize and streamline our deferral program to avoid protracted investigation and litigation of disputes that can be (and often are) resolved through the negotiated contractual grievance machinery.” Accordingly, the memo clarifies that regional offices should defer cases when “the initial evidence demonstrate that there is a reasonable chance that the parties can either resolve the dispute or, at the very least, set it to rest, using their contractual grievance-arbitration procedure.” The guidance further eschews quarterly status checks, inquiring about the status of the grievance, in favor of requiring the parties to file biannual status reports on March 15 and September 15.

Bipartisan Bill Would Discourage “Offshoring” of Call Centers. Senators Reuben Gallego (D-AZ) and Jim Justice (R-WV) have introduced the “Keep Call Centers in America Act of 2025” (S. 2495). The bill loosely borrows from the Worker Adjustment and Retraining Notification (WARN) Act by requiring employers to provide notice to the secretary of labor within at least 120 days before relocating a call center or contracting call center work outside of the United States. Employers that fail to provide this notice can be fined up to $10,000 for each day of violation. In turn, the secretary of labor would publish a list of call centers that have been offshored, and employers appearing on the list would be ineligible for federal grants or loans for up to five years after appearing on the list. Federal contracts will require all call center work performed in connection with that contract or subcontract to be performed in the United States.

OFCCP Sets New Veteran Hiring Benchmark. What is left of the Office of Federal Contract Compliance Programs (OFCCP) has set its annual Veteran Hiring Benchmark at 5.1 percent, effective July 30, 2025. The new benchmark is down—barely—from the 5.2 percent mark that took effect on March 31, 2024. Although the administration has rescinded Executive Order 11246 and has proposed, through its fiscal year (FY) 2026 budget justification, the transfer of enforcement of the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) to the U.S. Department of Labor’s Veterans’ Employment and Training Service, covered federal contractors are still required to establish written affirmative action plans under VEVRAA.

Lincoln, What Were You Thinkin’? Don’t like paying income taxes? Blame President Lincoln. This week in 1861, President Abraham Lincoln signed into law the Revenue Act of 1861, which instituted the United States’ first national income tax. In need of revenue to fund the Civil War, Congress passed the act to implement a flat 3 percent tax on incomes above $800 (about $29,000 today). The law wasn’t terribly successful, mainly because there was no effective way for the government to collect the taxes. Accordingly, the law was replaced by the Revenue Act of 1862, which instituted a progressive income tax of 3 percent on income over $600 and 5 percent on income over $10,000. Importantly, to facilitate the collection of taxes, the 1862 law established within the U.S. Department of the Treasury the “Office of the Commissioner of Internal Revenue,” a precursor to the Internal Revenue Service. A third law, the Revenue Act of 1864, added another tax bracket and expired in 1873. But all that money generated from income taxes proved too tempting for Congress, so they eventually passed the Wilson-Gorman Tariff Act of 1894, which reinstituted a 2 percent national income tax, but was ruled unconstitutional by the Supreme Court of the United States in Pollock v. Farmers’ Loan & Trust Company (1895). Finally, the Sixteenth Amendment of the U.S. Constitution, ratified in 1913, overruled Pollock and allows for the collection of income tax.

The Buzz will be on hiatus next week but will return on August 22, 2025.