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Change. America voted for it, and the HR world will certainly receive its fair share next year.

The arrival in Washington of President-elect Obama and a firmly Democratic-controlled Congress will spark an array of legislative and regulatory proposals that could rewrite the employment law rule book.

“The next four years will be one of the most interesting and challenging times any of us have ever faced,” says Michael Fox, an employment law attorney in the Austin, Texas, office of Ogletree Deakins. “It’s critical for HR people to be aware of what’s coming down the pike.”

Among the key employment law issues on Obama’s agenda:

  • Enact a series of pro-union initiatives, led by the Employee Free Choice Act, which would make it easier for employees to form unions in their workplaces 
  • Expand employees’ FMLA rights and mandate that employers offer paid sick leave to their workers
  • Create a new federally protected class based on sexual orientation, which would give gay and lesbian workers the right to sue for job discrimination
  • Eliminate the statute of limitations on pay-discrimination lawsuits, giving more workers the ability to file pay-bias claims
  • Create a new “play or pay” mandate on employers to either offer employee health insurance or pay a percentage of payroll into a government health plan
  • Remove the $300,000 cap on damage awards in employment discrimination lawsuits
  • Increase the minimum wage and peg future increases to the inflation rate
  • Increase criminal OSHA penalties

Business groups will oppose many of these measures, but each has a more than 50-50 chance of passing. Not only did Obama campaign on these proposals, they are also politically popular ones that congressional Democrats can push without risking middle-class voter backlash.

“These are all easy in concept for Congress to embrace,” Fox says.

Don’t expect the nation’s current financial crisis to hamper passage of these bills. Reason: They won’t directly affect the federal budget.

“In an ironic way, this may open the door to shifting expenses to employers that Congress itself will not be free to appropriate,” says Fox. “It will be easier to ask employers to pay for seven days of paid sick leave, for example, than it will be for Congress to legislate greater federal spending.”

Timing? Expect some of these sweeping changes to happen very quickly. As you may remember, the FMLA was passed and signed into law within two weeks of President Clinton’s inauguration.

How to respond. First, get educated on these proposals and review your budget. You’re almost certain to face higher litigation, regulatory and benefit costs.

To immunize your organization against union-organizing efforts, make it such a good place to work that employees won’t see the need to join a union. Develop a positive employee-relations program and improve your supervisor training.

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