Industry officials anticipate a quick confirmation of R. Alexander Acosta to be the next secretary of Labor after his March 15 confirmation hearing before the Senate Health, Education, Labor and Pensions Committee.
Following next week's hearing, announced by the HELP committee early Wednesday morning, an executive session will be scheduled for committee members to vote on Acosta's nomination.
While industry officials see Acosta being confirmed likely within a month, and a delay of Labor's fiduciary rule from its April 10 compliance date to June 9, they're skeptical that quick action will be taken by Labor on modifying the rule or doing away with it.
“It appears that there will be a delay to the [fiduciary rule's] applicability date until June. I don't see the Acosta hearing derailing this,” said Steve Saxon, chairman of Groom Law Group, which specializes in employee benefits.
Delaying the fiduciary rule's compliance date is necessary, Saxon said, so that Labor can respond to President Donald Trump's Feb. 3 order to review the rule, and if it deems appropriate, issue a proposal to revise it.
“What will be most interesting, and somewhat complicated, is what happens when [Acosta] gets there” to Labor, Saxon added. “We have a final [fiduciary] rule; it's effective, presumably, and it will have a set applicability date. There's a lot of momentum behind just moving forward with the rule; on the other hand, there's a lot of momentum on repealing the rule. Someone could drop a bill” on Capitol Hill to further derail the rule or litigators could persuade a court to issue a stay of the rule.
Fred Reish, a partner in Drinker Biddle & Reath's employee benefits and executive compensation practice group in Los Angeles, notes that while the delay can be done by acting Labor leadership, “it will take political leadership to evaluate whether to modify the rule or to kill it. At the least, that means that the secretary needs to be in place.”
Quicker action on the fiduciary rule's fate could occur if the assistant secretary of Labor's Employee Benefits Security Administration, headed by Phyllis Borzi during the Obama administration, was also in place, Reish adds. “I think the process of deciding whether and how to modify the fiduciary rule will be much slower than people think.”
Acosta, the only son of Cuban immigrants, is law dean at the public Florida International University in Miami as well as a veteran Republican administrator, serving as assistant attorney general for civil rights and U.S. attorney in Miami.
Trump noted in a press conference to announce Acosta's nomination his degrees from Harvard College and Harvard Law School as well as his service as a former clerk to Justice Samuel A. Alito of the Supreme Court, adding that he's had “a tremendous career” and has been through multiple Senate confirmations.
“I think he'll be a tremendous secretary of Labor,” Trump said.
He will be Trump's first Hispanic cabinet nominee.
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Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
