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May 4, 2009

Obama Sets Frenetic Pace for HR Issues in First 100 Days

Filed under: General HR Buzz8:36 am

If President Barack Obama’s first 100 days in office are any indication of the changes and reforms businesses can expect to see from the federal government, then the next four years could lead to drastic changes in the way HR professionals perform their jobs.

Facing one of the toughest economic conditions in decades, the Obama administration has launched an ambitious agenda that could have tremendous impacts on the way businesses compensate executives, provide health care coverage and offer retirement benefits to employees.

Just nine days into office, the president made it clear that workplace issues will be a top priority in his policy agenda when he signed the Lilly Ledbetter Fair Pay Act into law on Jan. 29, 2009. The wage discrimination measure was the first piece of legislation signed by the new president.

While it is too early to determine the actual effect Obama’s agenda will have on U.S. workplaces, the Society for Human Resource Management surveyed nearly 500 HR professionals to get their perspective on the potential impact of the administration’s policies.

The survey asked the respondents to rank the effect that 13 key issues could have on their organization’s HR budget, policies and practices. The top three issues ranked by the respondents were related to health care, showing clearly that Obama’s proposals to change health care policies have grabbed the attention of HR professionals.

Nearly three-fourths of the respondents said a proposal to tax employer-provided health care coverage would have a large impact on their companies, while 70 percent reported that proposals to change the delivery of care through the U.S. health system would have a major effect on their jobs. Those issues were closely followed by a proposal to change the requirements to pay for employee health care coverage, with 63 percent of the respondents saying it would have a large impact.

The other top issues with potentially major impacts included changes to the law for paid-leave requirements, reform of the way unions are organized and changes to COBRA, the health care extension law.

The federal subsidy for COBRA premiums was part of a massive $787 billion economic stimulus package passed by Congress and signed by the president in February 2009. The stimulus measure included a number of other HR-related provisions, such as caps for executive pay for businesses receiving federal bailout and stimulus funds and limits for immigration visas of highly skilled foreign workers.

Several health care provisions were part of the stimulus package, including $20 billion in funding for upgrades to the nation’s health information technology (HIT) systems and new HIT requirements for the public sector, including businesses that hold government contracts.

Obama has stated that comprehensive health care reform will be a priority, and congressional leaders have vowed to pass reform legislation during 2009. The likelihood that Congress could enact a health reform measure appeared to increase on April 28, 2009, when Sen. Arlen Specter, R-Pa., announced that he was switching sides and would become a Democrat. Specter’s move gives the Democrats 59 seats in the Senate—just one shy of the 60 votes needed to end GOP filibusters of reform proposals.

The Democrats could hit the magic number of 60 during 2009 if the legal challenges to the Senate election in Minnesota are resolved and Democrat Al Franken is certified as the winner.

While many opinion polls, political observers and journalists have given Obama high performance marks for his first 100 days in office, Republican leaders in Congress have criticized the president’s policies and have warned against enacting measures that would increase federal spending.

“The president’s first 100 days can be summed up in three words: spending, taxing and borrowing,” said House Minority Leader Rep. John Boehner, R-Ohio. “While middle-class families and small businesses struggle during this economic crisis, the administration and Democrats in Congress have spent more taxpayer dollars in 100 days than all previous presidents have spent combined, raised taxes on middle-class families in the middle of a recession, and piled an unprecedented amount of new debt on our children and grandchildren.”

Boehner said the Republicans will seek ways to work with the president and Democrats in Congress to find fiscally responsible solutions for health care reform.

Bill Leonard is senior writer for SHRM Online.

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