Is Aggressive Regulatory Enforcement a Challenge for Your Company?

Stepped-up rulemaking and enhanced federal agency enforcement has caused 56% of all U.S. employers, more than half, to express concern.

An annual survey, completed by more than 500 in-house counsel, HR professionals and C-suite executives, many from the nation’s largest companies, shows employers continue to feel the impact of a multitude of changing laws and regulations. The top three concerns related to employee compensation and benefits are:

Minimum Wage and Overtime Rules

Ongoing divisions in government and the deadlock of Congress is causing employers to feel the impact of President Obama’s focus on the federal agencies to bring about changes to workplace policy.  A particular area of concern for employers is the DOL’s pursuit of President Obama’s ‘income inequality’ agenda.  Employers are struggling with more aggressive enforcement and workplace reforms from several federal agencies. Measures to raise the minimum wage and expand overtime pay have 29% of employers indicating concern, both will have a significant impact on their bottom line.

Health Care Reform

The regulatory issue that respondents expect to have the most impact on their workplace during the next 12 months is the Affordable Care Act (ACA). Those that felt it would have a significant impact however has dropped 16 percentage points from 57 percent in a 2013 survey to 41 percent in 2014.

Employers are concerned about the ACA and health care reform continues to be one of the most pressing issues on the minds of all employers. Creating confusion among employers is the uncertainty surrounding the ACA, as well as delays in its implementation. Employee benefits attorneys or consultants have been engaged by 58 percent in response, to help track changing deadlines and upcoming compliance obligations.”

Similar to the 2013 survey, respondents identified a range of actions that they have taken or anticipate taking in response to the ACA’s implementation, albeit to a slightly lesser degree. The top action taken by roughly half of employers (52 percent) is the implementation of an employee wellness program. About a quarter of respondents said they would consider offering employees health care benefits through private health insurance exchanges (26 percent) or limit more employees to 30 hours per week (25 percent).

FMLA Management

A significant percentage of respondents (69 percent) indicated concern with employees abusing leave granted under the Family and Medical Leave Act (FMLA) and similar laws.

While the FMLA serves the goal of providing job-protected leave for qualified medical and family reasons, the reality is that employees sometimes abuse this privilege and this presents not only headaches, but very real business challenges for many employers. A survey found that “managing intermittent leave” and “controlling employee abuse” ranked first and second, respectively, in a long list of biggest leave-related challenges for employers.