2022 Labor and Employment Outlook for Manufacturers
This week, we continue our 2022 outlook series with a focus on labor and employment. It goes without saying that over the last two years, the COVID-19 pandemic has revealed certain weaknesses and opportunities in the economy and in our workplaces. In response, federal, state, and local governments have passed a number of laws and regulations addressing issues such as vaccination and workplace safety, paid leave, pay transparency, and other laws and several legislative trends have emerged. The following are a few of the issues and trends that may impact manufacturers in 2022.
COVID-19 Vaccination Rules
We expect that federal, state, and local governments will continue to actively respond to the COVID-19 pandemic. Last year, we saw many states and localities impose vaccination and/or testing requirements upon employers across various industries. Further, the federal government imposed vaccination requirements upon certain federal contractors, healthcare facilities, and private employers employing 100 or more employees. A myriad of legal challenges were brought in response, the most recent of which resulted in a decision by the U.S. Supreme Court staying the implementation of the federal Occupational Safety and Health Administration’s COVID-19 Emergency Temporary Standard, applicable to employers with 100 or more employees. Similarly, last November, a Georgia federal court temporarily blocked the vaccine mandate for federal contractors. In 2022, we may see additional developments concerning these federal initiatives as litigation on these issues continues. We also expect that state and local governments will continue to implement their own initiatives, especially in the absence of federal regulation.
Paid Family and Medical Leave
In recent years, several states have implemented or expanded their paid family and medical leave laws, including California, Colorado, Connecticut, Massachusetts, New Hampshire, New Jersey, New York, Oregon, Rhode Island, Washington, and the District of Columbia. As a result, employers in states that have enacted paid family and medical leave laws may see increased use of family and medical leave, on a long-term basis, amongst employees and should be prepared to manage such leave from a human resources and operational perspective.
Wage Disclosure Laws
In recent years, several states and localities have imposed pay transparency obligations upon employers. These laws contain varying employer obligations including providing wage ranges to new employees, including wage ranges or compensation on job postings, among other obligations. In light of these new requirements, employers should take steps to ensure they are in compliance with their relevant disclosure obligations in 2022 and beyond. We expect to see more states and localities join this trend, aimed at closing discriminatory wage gaps that may exist and increasing pay equity, in the coming years.
The “Great Resignation”
On the heels of the COVID-19 pandemic, many manufacturers are grappling with staggering labor shortages as employees across the country are resigning from their jobs at unprecedented rates, a trend that some have coined the “Great Resignation.” This trend is attributable, in part, to workforce issues such as exhaustion, burn-out, and stress among employees, which have worsened during the pandemic. As manufacturers seek to attract and retain talent in 2022, we expect to see an increased focus on hiring, recruitment, and incentivization of prospective and current employees. Further, we may see a shift in trends surrounding compensation, leave, benefits, and other offerings aimed at employee retention. Lastly, employers seeking to address staffing issues may wish to increase their focus on employee engagement and morale, wellness and mental health, training and development, recognition and rewards, and their overall workplace culture in 2022.
In 2021, the Biden administration designated both a new General Counsel and Chairman of the National Labor Relations Board (NLRB), both of whom have expressed the NLRB’s plans to significantly expand employee rights and protections under the National Labor Relations Act. As a result, in 2022, we may see the labor movement gain momentum, with higher rates of union organizing activity among employees across various industries. Employers should consider monitoring this issue, training supervisors on labor laws, and seeking counsel when necessary.