Employers Feeling Brunt of Rapid, Major Regulatory Changes
It's one step forward and two steps back as regulations are repealed at the federal level and then re-instituted by state and local governments.
Just when employers thought they had the answers, the questions changed.
According to the 2018 Littler Annual Employer Survey, that’s pretty much how employers feel about the drastic changes enacted in the business environment by the Trump administration. Many are struggling to keep up with the one-step-forward, two-steps-back dance as regulations are repealed and relaxed at the federal level, and in some cases re-instituted by state and local governments.
Compliance has become more of a challenge than previously, respondents say, particularly since businesses were cautiously looking forward to a friendlier regulatory atmosphere under the current administration—only to find themselves facing some drastic and abrupt changes even as they worked to implement policies put in place under the last administration.
In fact, vacancies in key government agencies have meant that some policies of the Obama administration are still being enforced. In addition, some states and municipalities are taking action to institute their own regulations in response to what they see as “policy vacuums at the federal level.” In 2017, for instance, more than 40 jurisdictions in the U.S. considered more than 100 bills aimed at closing the gender pay gap.
Numerous mandates from the previous administration on the health care law, overtime pay, union participation and pay data collection have been rescinded or put on hold, requiring businesses to rethink policies, procedures and training they had begun under those regulations.
In fact, 64% of respondents said that “the frequent and dramatic reversal of workplace policies and regulations with changes in political power” has them struggling to keep up, having to devote “significant time, money and resources on writing and rewriting internal policies, training and retraining employees and formulating and reformulating strategies.” In addition, 75% said that the patchwork of state and local labor and employment requirements arising in response to the administration’s more business-friendly approach has led to compliance challenges.
In 2017, 33% of businesses were worried about the effects of the Affordable Care Act; this year, only 15% of respondents expect a significant impact from the ACA. In addition, those expressing significant concern about Department of Labor and National Labor Relations Board enforcement also fell, the former from 25% to 16% and the latter from 13% to 8%.
Then there’s the #MeToo focus on sexual harassment and gender pay equity, with 66% of employers identifying sexual harassment as the past year’s most or second-most concerning issue impacting the workplace; gender pay equity came in next, at 41%. Over the next year, 64% of employers expect EEOC enforcement efforts to be focused on harassment, with 47% expecting such efforts on equal pay.
In anticipation, 55% of employers are providing additional sexual harassment training for supervisors and employees and 61% are auditing pay practices and salary data.
In the report, Barry Hartstein, co-chair of Littler’s EEO & Diversity Practice Group, says, “With the #MeToo movement and the EEOC’s focus on stemming the tide of harassment in the workplace, taking steps to minimize the risk of harassment claims should be a top priority for employers. We also should expect an active plaintiffs’ bar threatening and initiating private lawsuits during the coming year based on these developments.
Regulation and enforcement of policies on legal and illegal immigration have put many employers in the hot seat as they try to keep up. However, there’s a slight decline in the percentage of employers worried about immigration’s effects, from last year’s 63% to 58% this year of those anticipating a moderate or significant impact on their businesses.
Says the report, “This result is not surprising given that much of the focus around immigration reform has been on illegal immigration, and many employers responding to the survey may be operating in industries where undocumented workers are not a significant part of their labor pools.”
Industries most likely to anticipate significant effects, it adds, include hospitality and agriculture.