by Brianna Crandall — August 26, 2016 — Littler, an international employment and labor law practice representing management, has released the results of its 2016 Executive Employer Survey. The fifth annual survey, completed by 844 in-house counsel, human resources professionals and C-suite executives from some of America’s largest companies, examines the key legal, economic and social issues impacting employers as the 2016 presidential election approaches, such as overtime and “joint employer” law changes, discrimination claims and workplace violence.
New overtime rules, aggressive DOL enforcement
The Department of Labor (DOL) has advanced several regulatory initiatives that have brought the agency’s enforcement of federal employment laws more to the forefront for employers. The vast majority of respondents to this year’s survey (82%) expect DOL enforcement to have an impact on their workplace over the next 12 months, with 31% anticipating a significant impact (up from 18% in the 2015 survey).
One of the main concerns is the recently finalized Fair Labor Standard Act “white collar” overtime regulations that drastically increase the number of Americans who can qualify for overtime pay. Although respondents completed the survey in the weeks prior to the release of the final rule, 65% had already conducted audits to identify affected employees. The rule goes into effect on December 1, 2016.
Further, in ranking the priority they expect a presidential candidate from each party to place on various issues, the majority of respondents (75%) said income inequality (e.g., overtime rules, state equal pay, minimum wage laws, etc.) would be a significant priority of the Democratic candidate, in comparison to only 4% for the Republican candidate.
Joint employer, Affordable Care Act (ACA)
With the National Labor Relations Board’s recent expansion of the definition of a “joint employer,” 70% of respondents expect a rise in claims over the next year based on actions of subcontractors, staffing agencies and franchisees. Approximately half of respondents predicted higher costs (53%) and increased caution in entering into arrangements that might constitute joint employment (49%).
Michael Lotito, co-chair of Littler’s Workplace Policy Institute, pointed out:
It is significant and telling that only 2% of respondents said the expanded definition of a joint employer will have no impact on their workplace. This finding shows the breadth of the NLRB’s decision, overturning a standard of joint employment that had been in place for decades, which required a relationship that was actual, direct and substantial.
As in 2015, 85% of employers said the Affordable Care Act (ACA) would have an impact on their workplace in the next 12 months. While two-thirds said they do not expect a repeal of the ACA if a Republican is elected president this fall, respondents saw a greater likelihood of changes to individual provisions. A full 53% said a Republican administration could lead to a repeal of or changes to the tax, and 48% saw a likelihood for changes to the play-or-pay mandate.
Rising public attention to social issues
Employers have always had to keep an eye on demographic and social trends, but as information spreads more rapidly and as office culture shifts to accommodate a new generation, today’s companies are increasingly experiencing the incursion of social issues into the workplace.
In the largest year-over-year change in Littler’s survey results, 74% of respondents expect more discrimination claims over the next year related to the rights of LGBT workers (up from 31% in 2015), and 61% expect more claims based on equal pay (up from 34%). These issues both rank among the top enforcement priorities for the Equal Employment Opportunity Commission (EEOC), but also mirror key focus areas for the Obama Administration, government efforts at the state and federal levels, and increased public awareness.
In addition, the changing nature of work and the rise of the so-called “gig economy” have given companies more hiring options than ever, including independent contractors, contingent workers and an online workforce. While this shift has created greater flexibility for workers and increased efficiency for employers, it has also given rise to more independent contractor misclassification lawsuits and regulatory investigations. Despite the legal challenges, more than half of respondents at large-cap organizations either said they were not reluctant to hire more freelancers or contractors (24%) or they were neutral on the matter (35%).
Preventing workplace violence
In response to tragic mass shootings across the nation, companies are taking a range of actions to keep their employees safe, including updating or implementing a zero-tolerance workplace policy (52%), conducting pre-employment screenings (40%) and holding training programs (38%). Only 11% of respondents said they had not taken any action because violence is not a concern for their company.
Terri Solomon, a Littler shareholder with extensive experience counseling employers on workplace violence prevention, advised:
Putting policies in place to increase awareness of workplace violence and ensure that employees understand how to report threats in the workplace are steps that all employers would be advised to take. Unfortunately, even though workplace violence — and particularly active shooter instances — are statistically rare, no employer is truly immune, so taking preventative action can help save lives.
The 2016 Executive Employer Survey Report is available for free download from the Littler Web site. The firm also created an infographic to illustrate the survey results.
