Newsletter

Personnel(ly) Speaking

A Monthly Newsletter from

Personnel Management Systems, Inc.

October 2006

Trends and Changes for 2007

Reviewing the trends and changes happening across the country allows employers to look ahead to trends and changes that may affect the human resource management function, from budgeting to policy development to hiring. New laws in 2006 and upcoming for 2007 encompass many topics; we’ve chosen to highlight just a few. While often it is California that leads the pack in new legislation, other states are keeping pace.

Increases in Minimum Wage

According to the Economic Policy Institute, the federal minimum wage of $5.15 per hour has not seen an increase since 1997 and its value has dropped by 20% since then. In inflation-adjusted dollars, it is at its lowest value in 50 years. “The up and downs of the minimum wage relative to prices or purchasing power has important implications. A minimum wage that doesn't buy as much as it used to is a minimum wage that is placing a lower value on work and doing less for minimum wage workers. But another important principle of the minimum wage is that the gap between the standard of living of low-wage workers and the standard of living of other wage earners should not become excessive. By this measure as well, the minimum wage has declined and varied substantially. During the 1950s and 1960s the minimum wage varied between 44% and 56% of the average wage. It is now only 31% of the average wage.”[1]

The federal government has debated raising the minimum wage for years. Meanwhile, many states and the District of Columbia have not waited and have raised their minimums. Next month, voters in Arizona, Colorado, Missouri, Montana, Nevada, and Ohio will also vote on whether to raise their state's minimum wage.

The idea of tying the minimum wage to an economic index is taking hold. Automatic annual adjustments to the wage, or indexing, has gained increasing support and is becoming more common among states that have their own minimum wage laws.[2]

Four states—Washington, Oregon, Vermont, and Florida—now index their minimum wages to prices using the CPI (Consumer Price Index). Washington and Oregon both recently announced 30 cent increases for 2007, taking their minimum wages to $7.93 per hour and $7.80 per hour respectively.

Certainly minimum wage laws impact employers’ annual budgets. Knowing how and when states will increase minimum wages is valuable information for an employer’s long-term forecasting.

Anti-Smoking Initiatives

Anti-smoking initiatives are sponsored across the nation by organizations such as the American Cancer Society and the American Lung Association because of concerns about the harmful effects of second-hand smoke. Hawaii’s law that prohibits smoking in places open to the public and places of employment takes effect next month, joining a growing number of states enacting public smoking bans. The Centers for Disease Control and Prevention have tracked state smoking restrictions for private-sector worksite, restaurants, and bars in the United States, and have noted an increase in legislative activity throughout the country.[3] Washington State passed a similar initiative a year ago.

Changes to these workplace environment laws require employers to review their written and unwritten polices, policy enforcement, signage, and business communication to employees about the new requirements.

Increased Fair Employment Protections

State legislatures continue to outpace the federal government in protecting workers from various types of discriminatory behavior.

· Washington State joined 16 other states and the District of Columbia by prohibiting sexual orientation discrimination in private employment. Some states also specifically prohibit discrimination based on gender identity. Locally, more than 180 cities and counties nationwide prohibit sexual orientation discrimination in at least some workplaces.

· Maryland and New Jersey join California, New York, and Washington D.C. in ensuring that employees are not intimidated because of their political affiliations. In the 90 days prior to an election, Maryland employers may not exhibit in the workplace notices or threats that the election or defeat of a particular candidate will adversely affect employment. New Jersey employers may not require its employee to attend an employer-sponsored meeting to communicate the employer’s opinion about political or religious matters.

· Prohibitions on discrimination based on weight are discussed more and more. While Michigan is the only state that prohibits employment discrimination on the basis of weight, Santa Cruz and San Francisco, California have passed laws that prohibit employment discrimination on the basis of weight. Washington, D.C. is broader in its approach; it simply prohibits discrimination on the basis of an individual’s personal appearance. Other states come at the issue from a different perspective, adding obesity as a disability under their disability protections.

Whether or not these protections based on sexual orientation, political affiliation, and physical appearance will be adopted federally, employers should recognize that these issues exist and are most likely important to their employees. Evaluating each employee based solely on work performance will help keep employers ahead of these ever-changing laws.

While keeping up-to-date on the core business issues affecting the services and products provided to customers, employers must also stay current on the shifting public policy and regulations affecting their employees and their workplace. Staying abreast of federal, state, and local requirements can be quite time consuming. If you need assistance with your human resource function or want more information about the issues that may affect your workplace, call Personnel Management Systems, Inc.

Personnel(ly) Speaking is a monthly comment on HR issues of importance. It is intended to provide general information and must not be construed as legal advice. Reproductions are allowed as long as credit for this information is given to PMSI. We welcome your comments, questions, and concerns. © PERSONNEL MANAGEMENT SYSTEMS, INC., Corporate Office (425) 576-1900, Colorado Office (720) 497-0200, www.hrpmsi.com.

[1] Michael Ettlinger (2006, October 12). Securing the wage floor. Economic Policy Institute, Retrieved October 20, 2006. http://www.epi.org/content.cfm/bp177

[3] MMWR (2005, July 8) State Smoking Restrictions for Private-Sector Worksites, Restaurants, and Bars – United States 1998 and 2004. Retrieved November 30, 2005 from: http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5426a1.htm.