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Few specifics offered in plan to merge Labor, Education departments

Ian Lanoff thinks the EBSA will retain its resources and employees in any changes to the Labor Department.

The White House proposed merging the departments of Labor and Education as part of a federal government reorganization plan, but the prospect of the Department of Education and the Workforce — the name of the proposed combined agency — becoming a reality faces an uphill battle, experts say.

The proposal, unveiled last month, would merge all of the existing Labor and Education department programs into a single department with four main subagencies focused on K-12, higher education/workforce development, enforcement and research/evaluation/administration.

The enforcement agency would include worker protection agencies from the Labor Department that are responsible for enforcing statutes related to workers' pay, safety, benefits and other protections, as well as federal workers' compensation programs, according to the White House report.

Under the proposal, the Employee Benefits Security Administration would be part of the Department of Education and the Workforce's enforcement subagency. In fiscal year 2017, the EBSA recovered $1.1 billion in direct payment to ERISA-governed retirement plans, participants and beneficiaries, including $682.3 million from investigations, according to the agency.

Ian Lanoff, principal with Groom Law Group, a national ERISA law firm in Washington, has concerns about the proposal but doesn't think the EBSA would lose resources or employees in a reorganization.

Instead, he predicted DOL employees who focus on training programs could be reassigned to education-related areas.

Mr. Lanoff was administrator of the DOL's Pension and Welfare Benefit Administration — the precursor to the EBSA — from 1977 to 1981, and responsible for the development and administration of ERISA regulations and enforcement policies. With few details of the administration's plan readily available, Mr. Lanoff said he was unsure how a merger would affect the DOL on the whole: "Is the idea just to move everyone from Education and just house them under the same roof as Labor? Or is what they're really intending to do is to dilute the mission of both Labor and Education by assigning additional tasks to the workforce at Labor so that their attention would be diverted from what they're doing now?"

Chris Lu, deputy secretary of labor from 2014 to 2017 and now a senior fellow at the University of Virginia Miller Center, had a similar thought. "The Department of Education and Department of Labor have never been particularly well-liked agencies within the Republican Party," he said. "So the idea that you can take what I consider to be two important functions and basically merge them into one, in my mind is not only about efficiency, it's a precursor to starting to shrink both of those functions."

In a statement, American Benefits Council President James A. Klein said, "However the government agency is structured, what is most important is that the entity overseeing the employee benefits system views employers as partners in the effort to promote Americans' financial well-being and that the government agency has the mandate and resources to perform its essential functions."

Politically speaking

Combining the departments would require congressional approval. Several Republicans on Capitol Hill have come out in favor of the idea, including Rep. Virginia Foxx, R-N.C., chairwoman of the House Committee on Education and the Workforce, but there is much work to be done.

"It seems unlikely that this is going to be at the top of the priority list for Republican leadership in the House or the Senate," said Elizabeth Mann Levesque, a fellow in the Brown Center on Education Policy at the Brookings Institution.

Mr. Lu, was more blunt. "It's not going to fundamentally do anything because it's never going to happen," he said of the proposed merger.

Lawmakers questioned Margaret Weichert, deputy director for management at the Office of Management and Budget, at a House Committee on Oversight and Government Reform hearing on June 27.

Few specifics were offered during the hearing, especially with respect to the proposed Department of Education and the Workforce. Ms. Weichert said the administration is committed to dialogue and predicted the proposal would take between three and five years to implement once the proper approvals have been received.

"Much about the process that we engaged in was designed to ensure we had some really meaty proposals to put out for public debate before engaging in the more implementation-oriented part of change, which we know needs to happen in public," Ms. Weichert said in her testimony.

"Now that the plan has been issued we are eager to engage in a constructive conversation with Congress on how to moved forward together," she added.

Republicans on the House Oversight Committee were receptive to the reorganization proposal while Democrats questioned the need and motives for some of the ideas, like the DOL and Education merger, privatizing the post office and moving the policy function of the Office of Personnel Management into the Executive Office of the President. With respect to OPM, Ms. Weichert said the move would elevate the agency's agenda. OPM oversees the federal pension systems — the Federal Employees Retirement System and the Civil Service Retirement System, both based in Washington.

At the June 27 hearing, Rep. Mark Meadows, R-N.C., said it would "require a hand-in-hand work with Congress, the administration and stakeholders to fully recognize and realize the potential transformation that is envisioned here."