ILMA is the principle voice for the industry before Congress, federal regulatory agencies, and other industry groups. Association staff and consultants have been doing some serious, hard work on behalf of members, covering and reporting on a wide range of issues over the past year. Here’s a re-cap:

CHLORINATED PARAFFINS  EPA approved by way of consent orders the pre-manufacture notifications (PMNs) for 12 medium-chain chlorinated paraffins (MCCPs), long-chain chlorinated paraffins (LCCPs), and very long-chain chlorinated paraffins (vLCCPs). EPA said it will issue a Significant New Use Rule (SNUR) that applies the consent order requirements to any manufacturer or importer of these CPs. The consent orders and SNUR will require manufacturers and importers to conduct aquatic toxicity and biodegradability studies of the now-permitted CPs. EPA’s action eliminates the rumor that MCCPs, LCCPs and vLCCPs were going to be banned under TSCA, and it ensures their prospective availability for use in lubricant and metalworking fluid formulations for the foreseeable future. The PMN approvals are a significant “win” for the chlorinated paraffins manufacturers and their customers, including ILMA members.

Check out the video ILMA produced, with Andrew Jaques of the Chlorinated Paraffins Industry Association and ILMA members commenting on the CPs challenges faced and the victory won for our industry!

NEW TRANSMISSION FLUID LABELING REQUIREMENTS — On January 1, 2018, updated labeling and documentation mandates for transmission fluids go into effect automatically in 19 States based on amendments to NIST Handbook 130 adopted this past summer by the National Conference on Weights and Measures (NCWM). The regulations recognize that many oil marketers make and sell “suitable for use” or “multi-vehicle” ATFs. From an enforcement standpoint, evidence of current OEM licensing for the transmission fluid by the oil marketer is acceptable documentation of performance against the claimed specification. Suitable-for-use performance claims, including for multi-vehicle ATFs, are to be based on appropriate field, bench and/or transmission rig testing, including such testing done by additive suppliers. If the product performance claims are based on the claim(s) of one or more additive suppliers, documentation from the additive supplier(s) can be submitted upon request to the state agency. ILMA members should ensure that, unless they have conducted their own testing, they have or have access to additive company test data for their suitable for use or multi-vehicle ATF performance claims. ILMA members should also be aware that Handbook 130 does not provide for a “sell-through” period for any “old” transmission fluid labels; therefore, on the face of the amendments, all products must meet the applicable labeling and documentation requirements in the 19 identified States by January 1, 2018, regardless of when they were manufactured or distributed.

After passage of comprehensive reform of the Toxic Substances Control Act in June 2016, EPA began to implement various mandates from the revised statute. Last June, the Agency finalized three “framework” rules for chemical prioritization, risk evaluation, and the TSCA Inventory reset. ILMA commented extensively on all three rules during the rulemaking process. ILMA also has participated in EPA stakeholder meetings on the Agency’s efforts to streamline new chemical reviews and to identify strategies for prioritizing chemicals as “high” priority for risk evaluation or “low” priority for which a risk evaluation is not currently warranted. With the TSCA Inventory Reset rule finalized, some ILMA members, as “processors” under TSCA, need to be reviewing their records and/or work with their suppliers to ensure that active chemicals are not missed, particularly infrequently purchased batch chemicals that were manufactured, imported, or processed during the ten-year look-back period under the rule.

Congress has sent to President Trump the first overhaul of the U.S. tax code in three decades. Once signed into law by the president, the $1.5 trillion package will usher in steep rate cuts for American corporations, provide tax relief for pass-through business income, ease the estate tax, double the standard deduction millions of families claim on their annual tax returns and make a host of other tax code changes. Many of the provisions in the legislation take effect in a matter of weeks. The passage of the legislation, just before Christmas, fulfills a campaign promise made by President Trump after several failed attempts by congressional Republicans to repeal or overhaul ObamaCare. The tax bill sent to the president’s desk does include the rollback of the Affordable Care Act’s individual mandate requiring Americans to buy health insurance.

CHANGES AT THE NATIONAL LABOR RELATIONS BOARD —  With National Labor Relations Board (NLRB) Chairman Philip Miscimarra, a Republican, departing his post in mid-December, the Board took a number of actions to reverse some of the most troubling NLRB policies from the Obama era. These NLRB rulings, all passed by a 3-2 majority, are welcome news for employers, including ILMA members. First, the NLRB issued a decision in The Boeing Company that has broad implications for employer handbook policies and procedures, overturning its controversial precedent in Lutheran Heritage and outlining a new test that will hopefully make it easier for employers to establish and enforce reasonable workplace rules and restrictions. Second, the NLRB requested public comment on the controversial “ambush election” rules implemented during the Obama Administration to determine if they should be revised or rescinded. Third, it issued a decision in Hy-Brand Industrial Contractors, Ltd. and Brandt Construction Co., that overturned the Board’s controversial “joint-employer” Browning-Ferris precedent. The return to the direct and immediate control test provided for in Hy-brand should restore much needed certainly to employers, including ILMA members, who should be able to once again clearly decipher the dividing line between employee and independent contractor.

WATERS OF THE U.S. (WOTUS) RULE — EPA and the Army Corps of Engineers (Corps) announced a delay in October in the effective date of the 2015 Waters of the U.S. (WOTUS) regulation until two years after “the date of final action” on a new, proposed rule. The WOTUS Rule, which defines the scope of federal jurisdiction under the Clean Water Act, was adopted by the agencies under the Obama Administration in a 2015, and has far-reaching implications for project developers and property owners in the energy, water, agricultural, construction, and transportation sectors. Implementation of the WOTUS Rule has been on hold as a result of the U.S. Court of Appeals for the Sixth Circuit’s nationwide stay and the Supreme Court’s pending decision on the question of whether the court of appeals has original jurisdiction to review challenges to the WOTUS rule. The Supreme Court held oral arguments on October 11, 2017, and it could issue a decision resolving jurisdictional question at any time. Concurrently with the pending Supreme Court review, the agencies have begun a two-step rulemaking process to reconsider the WOTUS Rule. The first step proposes to rescind the definition of “waters of the United States” and re-codify the previous definition. In the second step, the Agencies are working to reconsider and revise the definition. According to EPA’s Unified Agenda, the Agency is expected to finalize the WOTUS repeal in April 2018 and propose a replacement regulation in May 2018.

APPRENTICESHIP CHANGES ON THE HORIZON — President Trump signed Executive Order (EO) 13801 last June to expand apprenticeship programs in the U.S. to hopefully yield a large talent pool for a variety of industry sectors and businesses, including for ILMA members. The EO instructs the Department of Labor (DOL) to propose regulations that allow the development of apprenticeship programs by third parties, such as trade associations, unions, or businesses, which would be approved and certified by the Government. Under existing apprenticeship rules, DOL directs how programs are administered, the length of hands-on training, and the minimum number of required hours of classroom instruction. DOL was directed to assemble a task force to determine strategies and opportunities to promote and expand apprenticeship programs at high schools, community colleges, and four-year universities. The task force met in November and discussed a proposed set of apprenticeship reforms. DOL’s task force has not yet released its recommendations; however, ILMA will have an opportunity to “weigh in” on any proposals during DOL’s public comment period.  Further, as the DOL finalizes its apprenticeship regulations, there will likely be an opportunity for ILMA to devise a program itself in 2018 and beyond.

DOL’S OVERTIME RULE — On October 30, 2017, the Department of Labor (DOL) appealed an August decision by a district court judge that the Obama-era Fair Labor Standards Act (FLSA) overtime rule is invalid. At the same time, DOL said it would ask the U.S. Court of Appeals for the Fifth Circuit to “hold” that appeal while it continued with a rulemaking to determine what the new overtime salary level threshold should be. DOL’s tactic is to ensure that it maintains authority under the FLSA to establish overtime regulations and, at the same time, give them time to review the more than 140,000 comments received on its “request for Information” (RFI). DOL says it intends to issue a proposed rule sometime in 2018 and speculation is that the salary threshold in the new proposed rule will be in the $30,000-$35,000 range. The invalidated Obama administration rule that was stayed nationwide in November 2016 would have more than doubled the salary level used to determine whether employees can be classified as exempt from overtime compensation under FLSA, extending overtime pay eligibility to most employees earning less than $913 a week (or $47,476 a year) from $455 per week (or $23,660 a year).

ILMA PROPOSAL ON OBSOLETE OILS ADVANCES — The four regional weights and measures associations have forwarded ILMA’s “obsolete oils” proposal to the National Conference on Weights and Measures (NCWM) for consideration as an “informational item” at its January 2018 interim meeting. At next month’s NCWM meeting, ILMA will ask that its proposal be a voting item for adoption at the group’s July 2018 annual meeting. ILMA’s obsolete oils proposal, if adopted, would ban the retail sale of “obsolete” engine oils for on-highway use that, in part, do not meet an active API service classification. Under ILMA’s proposal, there would be exemptions for “purpose-built” engine oils, such as those manufactured and sold for hot rods, street rods, antique vehicles, and muscle cars. These products, as appropriate, would be required to continue to be labeled in accordance with SAE J183 and would have to be segregated on retail shelves to avoid consumer confusion and misapplication. ILMA’s proposal also includes and exemption for motorcycle oils and for “recreational oils,” such as those used in small engines, lawn and garden equipment, marine engines, and recreational vehicles (e.g., ATVs).

COMMERCE DE-REGULATORY REPORT — The Commerce Department published its final report, “Streamlining Permitting and Reducing Regulatory Burdens for Domestic Manufacturing,” outlining the major issues raised by manufacturers and recommending priority areas for regulatory reform in response to President Trump’s January 24, 2017 regulatory reform memorandum. ILMA submitted detailed comments to the Commerce Department in March, highlighting members’ concerns with a number of rules across the Federal government, including EPA, DOL, OSHA, and NLRB. ILMA’s comments were cited a number of times in the Commerce Department’s report. The Commerce Department made a number of recommendations to Federal agencies about what regulations to address and appropriate next steps. The Commerce Department mandated that each agency’s Regulatory Reform Task Force deliver to the President no later than December 31, 2017, an “Action Plan” to address the issues highlighted in its report. 

MISSOURI ORDERS REMOVAL OF JOHN DEERE 303 TRACTOR FLUIDS —  The Missouri Department of Agriculture's Weights, Measures & Consumer Protection Division (MDWM) recently ordered retailers in the State to stop selling “303” tractor hydraulic fluids because the economy-grade products do not meet any currently available OEM specifications. MDWM noted on its website, “The John Deere (JD) 303 designation is 57 years old and has been obsolete for 43 years. In addition, there are no specifications available for 303 Tractor Hydraulic Fluids.” MDWM collected and sampled 14 different 303 fluids sold in the State, and each one failed to meet current OEM specifications. MDWM warned consumers that the use of the 303 products was very likely to cause significant damage to newer tractor equipment.

OSHA’S ELECTRONIC REPORTING AND ANTI-RETALIATION RULE — As part of the Occupational Safety and Health Administration’s (OSHA) “Improve Tracking of Workplace Injuries and Illness” rule, certain employers in high-risk industries and manufacturers began submitting electronically their 2016 injury and illness data from OSHA Form 300A on December 15. OSHA had delayed this reporting date several times this year and introduced its electronic reporting system for the rule last August. Employers are able to use the Agency’s web-based system to report the information that would normally be submitted on the paper forms. Meanwhile, OSHA says it intends to issue a Notice of Proposed Rulemaking to solicit comments on substantive aspects of the regulation in 2018, potentially resulting in a revision or rescission of the regulation entirely. As a reminder, OSHA’s rule also mandates that employers fully explain and promote employee reporting of work-related injuries and illnesses. Employers also may not retaliate against a reporting employee, and they may not implement incentive or drug-testing programs that could dissuade employee reporting.

WHMIS 2015 CBI CLAIMS — Health Canada (HC) published a proposal in the Canada Gazette in October 2017 that would allow for use of chemical concentration ranges by manufacturers, importers, and processors on their Safety Data Sheets (SDS) without having to apply at considerable time and cost for Confidential Business Information (CBI) protections for each individual product under the Workplace Hazardous Materials Information System 2015 (WHMIS 2015). ILMA submitted comments, encouraging HC to adopt the proposal to allow for disclosure of ingredients in ranges and still be fully compliant with the requirements of WHMIS 2015. If adopted, the proposal would permit chemical manufacturers and importers in Canada and the United States to have one SDS, safeguarding trade secrets and ensuring that the health and safety of workers is fully protected. It is anticipated that HC will announce its final decision on the use of those concentration ranges in 2018.

SPCC; HAZARDOUS SUNSTANCE TANKS — EPA is required by court order to issue a final rule to regulate “hazardous substances” tanks by 2019 under Section 311 of the Clean Water Act. The practical impact will be to expand EPA’s Spill Prevention, Control and Countermeasure Rule (SPCC) to include these tanks. Since the court approved the settlement, EPA has assembled a project team to begin work on the proposed rule, initiated an Information Collection Request, began research and analysis of existing hazardous substances rules, and secured contractor resources to support the project team. EPA published a Request for Information in the Federal Register in September 2017, seeking specific information from state and local governments regarding the number of facilities covered by the Emergency Planning and the Community Right-to-Know Act that store hazardous materials as well as historical discharges. Many ILMA members’ facilities are already subject to EPA’s SPCC program, which currently regulates discharges of mineral and vegetable oils. Notably, EPA recently issued an agency-wide directive, effectively ending the sue-and-settle practice that initiated this rulemaking. Given that EPA must promulgate a final rule in 2019, it is likely to issue a proposed rule sometime in 2018.

INFRASTRUCTURE PROPOSAL COMING IN JANUARY — President Trump is expected to release his administration’s infrastructure proposal in January 2018, detailing to Congress a blueprint of how the White House would like to approach essential updates to the nation’s bridges, roads and tunnels. The promised infrastructure proposal would follow up on the president’s November statement to tackle infrastructure as soon as tax reform was passed, which occurred on December 20. While infrastructure updates enjoy near universal support, funding remains a significant hurdle. However, ILMA is encouraged that infrastructure will be a focal point in 2018 given that those projects are a significant source of lubricant demand.

EEOC’S PAY DATA COLLECTION —  The Office of Management & Budget (OMB) sent a memo to the Equal Employment Opportunity Commission (EEOC) earlier this year, informing it that OMB had commenced a review and implemented an immediate stay of EEOC’s efforts to collect expanded pay data information. The pay data information request was published during the Obama administration and would have required employers, including ILMA members, to submit detailed employee wage information. The EEOC contended the regulation was necessary due to its ongoing concerns with pay disparities between women and men and among different ethnicities and races. EEOC intended to utilize the data collected to ascertain whether certain employers were engaging in discriminatory practices. There are obvious limitations to solely utilizing a W-2 to gauge discriminatory intent as many employers have implemented compensation systems that include non-taxable components (e.g., 401k contributions) that are not reported as W-2 income in the year they are received. Further, there are many nuances within a pay band (e.g., time of service with the individual company) that would not be adequately captured by the new requirements. The fate of the regulation is uncertain at present, but it is unlikely to be revived under the Trump Administration in 2018.

Hundreds manufacturers, including some ILMA members, participated in the National Association of Manufacturers’ (NAM) 2017 Manufacturing Summit in Washington, D.C. last June. With more than 200 scheduled congressional meetings over two days, ILMA members and their manufacturing colleagues made the case for legislation important to U.S. manufacturers. During group functions, the participants heard from House Speaker Paul Ryan (R-WI), Vice President Mike Pence, House Majority Leader Kevin McCarthy (R-CA), and Secretary of Labor Alexander Acosta. Events like the NAM Manufacturing Summit are a useful opportunity to educate lawmakers about issues important to ILMA and members should consider participating in the event in June 2018.

ILMA covers all the relevant public policy issues and industry happenings in the daily news ticker on our homepage. Public policy updates are wrapped up every Friday with ILMA Digest. Stay tuned for continued coverage of all the important news for the lubricants industry in 2018.