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As 2009 winds down, it’s a great time to review the key workplace developments of the year, and talk about their implications for the future.  A lot happened in 2009; events that put us on edge, and that will have a lasting impact on how employers manage risk and compliance. 

I know many of you are knee-deep in planning for next year, and facing very tough time and budget constraints.  You’re trying to really focus your compliance efforts.  To assist you with that challenge, here are my top workplace compliance stories of 2009. 

These are the trends and developments driving the greatest areas of risk, and where your organization needs to find innovative and effective solutions in 2010.

1. The Ledbetter Fair Pay Act

 President Obama had barely been in office for a few days when my first significant development took place:  the passage of the Lilly Ledbetter Fair Pay Act.  This law overturned a 2007 Supreme Court decision, which held that an employee wanting to make a pay discrimination claim had to act within 180 days of the first allegedly unfair paycheck.  The Ledbetter law significantly changes this ruling, and says that an employee can now bring a pay discrimination claim within 180 days from any allegedly discriminatory paycheck. 

The bottom line:  the Ledbetter law makes it much easier for employees to bring pay discrimination claims, since employers will no longer be able to argue that many of these claims are time barred.  Basically, each new paycheck re-starts the time clock to bring a discrimination claim, vastly expanding an employer’s potential liability.

2. Appointment of Hilda Solis as Head of DOL

 Our second significant development this past year was Obama’s appointment of Hilda Solis as our new Secretary of Labor.  There’s no question that she brings a renewed focus on enforcement to the areas she oversees, like OSHA and the Fair Labor Standards Act.  Solis has ardently and publicly declared that  “[T]he DOL is back in the enforcement business!”  Putting her money where her mouth is, Solis is expected to hire 250 new wage and hour field investigators.

So what’s the practical impact of the Ledbetter law and our new Secretary of Labor?  Quite simply, more numerous and even more vigorously prosecuted wage and hour lawsuits. And as we all know, these lawsuits come with a staggering price tag, with average settlements at both the state and federal level exceeding $20 million.  
While all employers are vulnerable to these actions, there’s been a great deal of recent activity in the healthcare and retail sectors.  As a result, employers are redoubling their wage and hour compliance efforts - making sure their pay practices are compliant, and training both their managers and their employees to know, understand, and comply with these important policies.  Not surprisingly, we also saw many organizations in 2009 auditing and, if necessary, adjusting their pay practices to ensure they weren’t potentially discriminatory.

3. EFCA

Another huge topic in 2009 was the Employee Free Choice Act, or EFCA.    This bill, if passed in its current form, would make sweeping changes to the National Labor Relations Act — the law which governs unions and unionization.  First, it would replace the current union election process with a card check system, meaning a union could represent a group of workers simply by collecting signatures from a majority of those workers.  Second, it would impose a requirement that if an initial labor contract was not reached quickly after a union was certified, a government-appointed arbitrator would step in and decide the terms and conditions in that contract.  Finally, EFCA would dramatically increase fines imposed on employers (but not unions) found guilty of unfair labor practices. 

EFCA garnered a ton of attention at the beginning of 2009 as Obama began his term in office, primarily because he’d been such an outspoken supporter of EFCA during his presidential Campaign.  By mid-year, we saw various compromise proposals being floated, many of which modified the card-check provisions and imposed obligations on employers to allow unions “equal access” to employees.  Things really heated up around Labor Day when Obama, Solis, and Specter all made significant pronouncements regarding EFCA.  Since then, the EFCA debate has continued, although it has been somewhat overshadowed by Health Care Reform discussions.   Things will likely heat up again in 2010 around the mid-term elections.

So what are employers doing now?  Well, here’s what we’re seeing. Interest in unions is high, and employers are already observing increased organizing efforts ahead of EFCA’s possible passage.   So many employers are getting proactive in response to the general union “buzz” created by the EFCA debate. 

Employers are educating their managers on the basics of unions and union organizing, as well as what supervisors can and can’t do when faced with union activity.  Why the big uptick in union awareness training?  Employers are realizing that most of their managers are totally clueless about unions.  With only about 7% of the private sector currently unionized, most supervisors have never managed in a unionized environment or had to handle a union organizing drive. 

Looking ahead to 2010, employers are also preparing to promptly educate their managers once EFCA (in its current or in a compromised form) gets enacted.  Because the law will be fundamentally different, managers will need to understand the new rules of the road.

Given Obama’s recent nominations to the National Labor Relations Board, it’s also critical to understand the magnitude of change taking place at the NLRB, which has the ability to significantly ease restraints on union organizing without intervention by Congress. So with or without EFCA, a revamped NLRB is poised to effect major union-friendly policy changes.   What I’m trying to hit home here is that the writing’s on the wall for increased organizing activity, and employers need to be prepared.

4. Technology in the Workplace 

Web 2.0 meets workplace harassment and discrimination. With the explosion of texting, blogging and social networking, in 2009, employees discovered all kinds of new ways to get themselves in trouble. With more than 4.1 billion text messages sent daily and Facebook reporting more than 307 million users, it’s no wonder we’ve seen an explosion of complex workplace issues flowing from these new technologies. 

The headlines this year have been filled with tawdry stories of workplace “sexting,” resulting in some high profile terminations and PR snafus. And the social networking trend has been even more prevalent. In fact, a recent study from 2009 shows that more than twenty-four percent of employers have had to discipline an employee for inappropriate behavior on social networking sites like MySpace and LinkedIn.  And the data shows these are not “younger worker” issues. They span the age range, with the most prominent increases in the 30+ demographic.

Employers are playing a constant game of “catch-up,” trying to update policies, establish appropriate boundaries and train their employees on a constantly evolving set of issues. And most employers, based on our experience, are woefully behind.  Unfortunately, even if you revised your polices and training as recently as two years ago, chances are they’re outdated and don’t address emerging technologies. 

What can you do?  Revise your policies to address social networking, blogging, and texting, and make sure your training programs reinforce your polices – especially the latest trends. Online training is a particularly effective tool to train on these topics, because it allows employers to simulate in a virtual environment, the very issues they are trying to address.

5. The Economy

My last 2009 trend is the continuing tough economy.  While I hate to wrap up this blog post on a down note, the economy’s impact on the workplace continues to be significant and issue number one for most employers. Although things improved slightly on the back-end of this year, we continue to see alarming job losses, with the unemployment rate at a 26-year high, exceeding 10%. 

But here are some numbers that are even more eye-opening.  Well-documented studies have shown that every 1.5% increase in the unemployment rate translates to a corresponding 21% increase in employment litigation.  Preliminary reports indicate that employment litigation continued to explode in 2009.  We also anticipate that the number of EEOC charges filed will continue 2008’s trend, and show a significant increase when the EEOC’s official FY ’09 stats are released this coming January.  
And adding to the trend of statistical “upticks,” we’ve unfortunately seen a string of serious and deadly workplace violence incidents in 2009 as frustrated employees turn their anger on coworkers and managers. 

So what does all this sobering information add up to? 

At first blush, it seems like a major headache and a source of increased cost for employers.  You know you need to do more to help stem this tide, but are struggling with limited training and compliance budgets. Cutting back on compliance programs is tempting, but the reality is, if organizations are to survive, and thrive, post recession, they need to protect their most valuable assets – their people, and their reputations. That means getting ahead of the legal trends, preventing the most prevalent risks, and establishing powerful affirmative defenses should you find yourself having to defend the organization.

And you know what that means.  It all boils down to keeping your policies updated, and bringing them to life with effective, interactive training.

So there you have it. My 2009 Workplace Compliance Trends in Review. This has been an interesting and challenging year, to say the least. 

We’ll continue to keep a close eye on employment law and compliance issues as we kick off 2010, and bring you regular updates through our podcasts, webinars, newsletters and regular blog posts.