Labor Secretary Marty Walsh is set to leave the Biden administration to run the NHL Players’ Association, two people familiar with the matter confirmed.
A separate person privy to the talks said that the two sides are currently in contract negotiations.
Walsh’s departure would come amid a wider shakeup within the Biden administration as it begins the tail end of its first term in office and prepares for a possible reelection campaign.
A former union official who previously headed up the Building and Construction Trades Council in Boston, Walsh is set to return to his roots in organized labor after giving some consideration to making another run at elected office in his home state of Massachusetts.
News of Walsh’s move was first reported by The Daily Faceoff. It was not immediately clear what his exit day would be, and neither the White House nor the Labor Department immediately returned requests for comment.
Walsh played a high-profile role in several of the administration’s interactions with organized labor. He brokered an eleventh-hour compromise between freight rail carriers and unions in September and visited the West Coast as port workers renegotiated their contract with employers. But it’s a mixed track record: Congress eventually had to weigh in on the railroad dispute, and West Coast port talks remain ongoing.
His departure would leave Deputy Labor Secretary Julie Su, who oversaw the rollout of California’s divisive gig work law, as the agency’s acting head. That law, AB 5, established a new three-part test that redefined many of the state’s gig workers as employees.
Already, a coalition that represents gig companies like Uber and Lyft are taking shots at Su over her tenure as the head of California’s labor agency.
“Secretary Walsh recognized gig workers as an important part of the workforce with a unique need for flexible work,” said Chamber of Progress CEO Adam Kovacevich. “It’s critical that the next Labor Secretary recognize the value of gig work. Unfortunately, Deputy Secretary Su’s history in California raises questions about whether she would respect the will of gig workers who wish to remain independent.”
However Su has several vocal proponents in Congress, particularly among Democratic members who have taken issue with the amount of Asian American Pacific Islander representation — or lack thereof — in the upper echelons of the Biden administration. The deputy secretary is the child of Chinese immigrants.
Some lawmakers want Biden to draft her for the permanent position.
“I think he should” nominate her, said Sen. Mazie Hirono (D-Hawaii). “I hope he does. I will be very happy to support her because I have talked with her and as I said she and Marty really made a very good team.”
With much of Biden’s pro-union reform concentrated in the White House, Walsh is set to leave with several pivotal regulations still in the works at the Labor Department. Those include a proposed rule, initially expected months ago, that would expand the number of workers eligible for overtime pay, and a final rule redefining which workers qualify as independent contractors. The latter carries significant ramifications for gig work companies, whose profit models are dependent on how they qualify their workforce.
Given Republican control of the House, Walsh would have faced significant congressional oversight from newly installed House Education and Workforce Chair Virginia Foxx. The North Carolina Republican said in an interview last month that she’s centering her agenda on “trying to monitor what the Department [of Labor] is doing” and “calling the department’s hand.” She cited Walsh’s visit to Kellogg picket lines in October, among other things.
Just hours after the first reports of Walsh’s impending departure, Foxx sent a letter to DOL Solicitor General Seema Nanda demanding information about what precautions the labor secretary took while pursuing the NHLPA job.
“The American people deserve to know that Secretary Walsh met his ethics obligations while searching for employment outside of the federal government,” Foxx wrote.
Walsh, a personal friend of Biden’s, beat out several candidates for the Labor job in 2021, including Rep. Andy Levin (D-Mich.), former Deputy Labor Secretary Seth Harris, Su and AFL-CIO Chief Economist Bill Spriggs. He enjoyed more bipartisan support than many other Biden nominees, leaning on his track record as Boston mayor to win over corporate America and even some congressional Republicans, who saw him as the friendliest option.
The former Boston mayor left toward the end of his second term to join the Biden administration but never moved to Washington, D.C., instead footing the bill to commute between his home in the city’s Dorchester neighborhood and his job.
By taking the players’ association gig, Walsh is now in line for a massive pay bump. Walsh makes a little over $200,000 as labor secretary. The current NHLPA executive director reportedly makes about $3 million.
Walsh had been regularly talked about as a future candidate for office in Massachusetts. But he passed on running for the state’s open governor’s seat last year, unwilling to get involved in a primary against Democrats’ heir apparent, now-Gov. Maura Healey. In addition, Sens. Elizabeth Warren and Ed Markey (D-Mass.) have both pledged to seek reelection to their Senate seats in 2024 and 2026, respectively.