Government regulation/enforcement, pay equity among top workplace issues

Workplace issues are growing increasingly complex amid a growing patchwork of state and local employment laws and the ongoing #MeToo movement.

That’s according to a survey by Littler, the world’s largest employment and labor law practice representing management, which found that employers’ compliance challenges swelled on multiple fronts over the past year under unexpectedly robust enforcement of federal employment laws and a mounting patchwork of state and local requirements. The “Littler Annual Employer Survey, 2019” also found that employers are more preoccupied than ever with preventing harassment and pay inequality in the second year of the #MeToo movement.

Employers continue to anticipate a substantial impact on their workplaces from a range of regulatory issues in the year ahead. Department of Labor enforcement of federal employment laws topped the list, with 78% of respondents anticipating a moderate or significant impact, followed by enforcement by the Equal Employment Opportunity Commission (EEOC) (77%) and developments concerning the Affordable Care Act (ACA) (57%).

“Despite the lack of activity on regulatory matters over the past two years, agencies are moving quickly to complete their regulatory agendas before the 2020 election season,” said Michael Lotito, co-chair of Littler’s Workplace Policy Institute. “2019 is a year of preparation as the race is on to finalize rules that could have an enormous impact for employers in the coming years.”

This includes the DOL’s new proposed rule to revise the “white collar” overtime exemption regulations, which the majority of employers were already preparing to comply with prior to the release of the proposal. In addition to the 42% of respondents who instituted changes prior to the injunction of the 2016 rule, 40% are reviewing job descriptions to verify the classification of current employees, and 36% are auditing compensation to identify those employees likely to be impacted.

Survey respondents pointed to numerous employment laws at the state and local levels creating compliance challenges for their organizations. Paid sick leave requirements top the list with 69% of respondents indicating difficulty in complying with a growing array of laws that are often conflicting in nature, followed by legalization of marijuana (54%) and background check stipulations (52%).

Employers expect the EEOC to continue to be aggressive in its enforcement efforts. The top three areas where respondents expect an increase in workplace discrimination claims over the next year include harassment claims (61%), retaliation against employees who file discrimination or harassment claims (49%) and equal pay (47%).

With the continued momentum of the #MeToo movement and calls for workplace equality extending to include equal pay, sexual harassment and gender pay equity are also key areas of focus for companies.

Specifically, employers are taking greater action across the board to curb sexual harassment in their workplaces compared to last year’s survey, including providing additional training to supervisors or employees (63% in the 2019 survey, up from 55% in 2018), updating HR policies or handbooks (51%, up from 38%) and more proactively addressing complaints and potential misconduct (37%, up from 29%).

In addition, employers are taking action to address gender pay equity, with 48% auditing salary data and pay practices and 24% revising hiring practices.

“#MeToo has touched every industry imaginable; it impacts all types of companies, large or small, high profile or even no profile,” said Helene Wasserman, co-chair of Littler’s Litigation and Trials Practice Group. “The survey data shows that most companies are taking this issue seriously and are focused on providing training and updating policies and procedures to ensure employees are treated fairly and feel safe in the workplace.”

The Littler survey was completed by 1,331 in-house counsel, human resources professionals and C-suite executives. Here are additional findings from the report:

• Most respondents (63%) say their companies are taking steps to address unconscious bias, the “mental shortcuts” that influence decision making in hiring, promotions and other areas. More than one-third (38%) have conducted training, and 26% have developed plans to improve diversity and inclusion.

• Respondents are starting to use AI or analytical tools in recruiting and hiring, with screening resumes or applications the most commonly cited method by 25% of respondents.

• Many employers are taking some steps to prepare for the impact of robotics, AI and automation on the workplace – including identifying tasks that can be automated (37%) and hiring talent skilled in emerging technologies (22%). However, 46% have not taken any action in this area.

“HR is ripe for the implementation of AI-based tools, given that companies have troves of existing data surrounding job postings, applications, promotions and other decisions to train algorithms,” said Aaron Crews, Littler’s chief data analytics officer. “While the use of AI in recruiting and hiring is in its early stages, more and more companies are realizing the significant benefits technology brings to augment HR departments and support more informed decision making.”