Outlook for employers in the United States

January 2013 | MARKET OUTLOOK 2013

Financier Worldwide Magazine

With the balance of power in Washington unchanged by the 2012 election, the legislative gridlock should continue. In place of new legislation, employers will encounter a storm of new regulations and initiatives by the regulatory agencies, with many agencies seeking innovative enforcement techniques to win favour in a big-government environment.

President Obama’s Patient Protection and Affordable Care Act is here to stay – at least for the next four years, and employers should brace themselves for the implementation of ‘pay-or-play’ provisions in 2014. Many key questions will remain unanswered until further regulations are issued which are expected in mass in the near future. At the end of the day, employers will need to make difficult decisions on coverage.

The NLRB has been among the most aggressive of the employment-related federal agencies, proposing rules regarding election procedures and posting and attacking social media and solicitation policies in an effort to expand Section 7 rights. Although the NLRB has faced judicial attacks on the election and posting rules and legal challenges to President Obama’s recess appointments, we expect the NLRB to continue to press for ways to make union organising easier. Among the initiatives to watch are the NLRB’s micro-unit decisions and proposed ‘persuader’ regulations, both of which ignore many years of relatively stable precedent.

The EEOC reaffirmed its aggressive enforcement strategies in a draft Strategic Enforcement Plan. According to the Plan, the EEOC’s nationwide priorities include eliminating systematic barriers in recruitment and hiring and addressing pay disparities, job segregation, harassment and discriminatory language policies. Additional EEOC focuses will include the ADA Amendments Act, LGBT coverage under Title VII and rules for accommodating pregnant employees.

We expect the DOL to focus first on implementing its ‘Plan, Prevent, Protect’ strategy which will require employers to self-monitor and remedy violations. This strategy, which goes hand-in-hand with the DOL’s priority in eliminating worker misclassification, likely will include a proposed rule requiring employers to perform a classification analysis for each employee who is excluded from Fair Labor Standards Act coverage.

At the top of OSHA’s priority list are increased penalties for violations of the Occupational Safety and Health Act, as well as a possible rule that would require employers to put in place a comprehensive injury and illness prevention program.

While employers would like to steer clear of the regulatory storm, there is no safe direction to turn. Instead, employers need to be buttoned up and resilient. Said differently, employers need to be lean and flexible. And there is no better way for an employer to strengthen itself than to focus on and master the basics: right-sizing its workforce, giving the surviving employees the respect they deserve, auditing its employment practices, updating its personnel policies and training and retraining its supervisors. Employers should not wait until they ae challenged to fix an issue that could have been avoided by focusing on the basics.

L. Traywick Duffie

Office Managing Shareholder

Littler Mendelson

T: +1 (404) 443 3547

E: tduffie@littler.com

www.littler.com

L. Traywick Duffie

Littler Mendelson