Wrestling with Workplace Policies and Regulations
Each year, the employment and labor law firm Littler conducts a survey that’s designed to shed light on how employers are reacting to the social and political changes occurring around them at the moment. More than 1,100 companies took part in the Littler Annual Employer Survey 2018. And, as you might imagine, the current social and political climate is giving employers an awful lot to think about regarding workplace policies and regulations in particular.
For example, 62 percent of those polled said the rollback of wage-and-hour policies (i.e., the Trump administration’s decision to rescind the Obama administration’s interpretation on classification of independent contractors and the Obama-era overtime rule, among others) has dramatically affected their businesses, with 62 percent saying the same about the new tax bill.
Not surprisingly, organizations also anticipate that stricter regulations and enforcement of legal and illegal immigration will have a significant impact in the coming year. For instance, 48 percent of respondents noted tighter restrictions on visa adjudications, such as those for employees with specialized skills and temporary workers, as their top concern. In addition, 36 percent expressed concern with increased workplace immigration enforcement by U.S. Immigration and Customers Enforcement and other agencies.
“The survey results show that employers are feeling some regulatory relief following several changes to workplace policies and regulations over the past year,” says Michael Lotito, co-chair of Littler’s Workplace Policy Institute.
That said, the majority of employers responding to this year’s Littler survey indicated that these sweeping changes have also created challenges for them, adds Lotito.
For example, 64 percent of these companies said that reversals of workplace policies and regulations between presidential administrations “put a strain on their businesses.” In addition, 75 percent reported that they face challenges as states and localities work to fill perceived policy vacuums at the federal level.
Indeed, the survey showed that employers “continue to grapple with navigating an increasingly fragmented—and sometimes contradictory—patchwork of state and local labor and employment requirements,” says Lotito.
“Varying workplace regulations at the state and local level is the No. 1 area of concern we hear in talking with HR professionals, given the significant time and costs that come with tracking, complying, training and updating procedures to keep pace with the changes. Because of this, some companies have chosen to universally apply the laws of the strictest jurisdiction.”
Above all, “companies want certainty,” he says, “and the continuous reversal of federal workplace policy makes it difficult for employers to plan, budget and anticipate, while also requiring the constant retraining of employees and reformulating of employment policies.”
Regulatory matters aren’t all that employers have on their minds, however. The majority of survey respondents (66 percent) ranked sexual harassment as their biggest or second-biggest issue right now. Forty-one percent placed gender pay equity among their top two concerns.
“The #MeToo movement, increased attention to gender pay equity and other forces of change impacting the workplace have focused greater attention on workplace behavior, company culture and equal treatment of employees,” says Helene Wasserman, co-chair of Littler’s litigation and trials practice group.
Littler’s research suggests that employers have begun to sit up and take notice of these changes. Consider that 55 percent of respondents have added training for supervisors and employees, and 38 percent have updated human resource policies or handbooks. On the other hand, just 13 percent have implemented new tools or investigation procedures to manage employee complaints and 24 percent have not made any changes over the past year.
Such basic steps are crucial for an organization to take, and show the importance of reevaluating and reinforcing policies and procedures, says Wasserman.
But, in addition to providing training and updating policies, “it’s critical that companies have effective complaint procedures in place, and that employees feel confident that reports of potential misconduct will be taken seriously and acted upon,” she says.
“While the law governing harassment in the workplace hasn’t changed much, employee expectations certainly have. Therefore, it’s important for HR professionals to communicate to employees how seriously the company takes this issue, and ensure the proper policies are in place to provide a harassment-free workplace.”
John Bremen, a managing director at Willis Towers Watson, sees employers taking action in response to the various changes swirling around the corporate environment.
Overall, “the findings from this survey resonate with me, based on what I am hearing from clients and seeing in our own research,” says Bremen. “U.S. companies continue to respond to changes in the regulatory environment, and many do genuinely seem to be seeking opportunities to invest in people programs and examine possible changes through a total rewards lens, especially in light of the continually tightening labor market.”
Bremen also sees organizations relying on developing technology to address these challenges, naturally. The Littler survey suggests as much.
At 49 percent, recruiting and hiring is the most common area for the use of advanced data analytics and AI, according to Littler’s most recent employer survey. Employers also say they’re relying on big data to guide HR strategy and employee management decisions (31 percent), analyze workplace policies (24 percent) and automate tasks that were previously performed by humans, cited by 22 percent of respondents.
“[Employers] are indeed embracing people analytics and artificial intelligence as they work to modernize and personalize their people programs, given the dynamic and quickly changing environment,” says Bremen. “At the same time, they are trying to increase feelings of confidence and stability [among] an otherwise jarred workforce amidst the disruption, recognizing that programs such as healthcare and retirement benefits are now top priorities for both new and more tenured entrants to the workforce.”
And employers are taking on this effort “while trying to instill a sense of purpose, culture and values through programs such as pay equity, codes of conduct, anti-harassment policies and articulation of organizational and individual purpose,” he adds. “So, yes, it’s a busy time for HR, and a time that’s ripe with opportunity for employers.”