Chair Pam Kimmet welcomed attendees to HR Policy Association’s first in-person Washington Policy Conference in three years, explaining that the agenda was framed to cover the pressing issues facing CHROs, including the employer response to employee voice, a full regulatory agenda, and the 2022 midterm elections.
Panels featured conversations on the impact of the Latino vote, the future of health equity, evolving labor relations issues, employer responses to the post-Disney and Starbucks environment, and more. Read on for summaries of the discussions.
Keynote: A Conversation with 70th U.S. Secretary of State, Mike Pompeo
Former U.S. Secretary of State (2018-2021) Mike Pompeo joined Association CEO Tim Bartl to offer his thoughts on international developments and threats, domestic issues such as ESG and political polarization, and the path forward.
The presumptive presidential candidate laid out his concerns about the policies of the Chinese government, including on cybersecurity and economic competitiveness, while pointing to the tension between China and Taiwan as an opportunity for U.S. leadership. He prompted that the U.S. should restrict commercial activity with China that is strategically important from economic and national security standpoints.
Mr. Pompeo also covered regional concerns around Mexico with respect to the nationalization of natural resources, North Korea and the national security risk it presents, and the rolling global impacts of Russian aggression toward Ukraine, including energy availability in Europe.
The former Secretary of State took aim at ESG, focusing his criticism on the “E” component, expressing concerns about increased poverty and food security concerns from reducing reliance on traditional energy sources and the role of fossil fuels in our current economy.
From a domestic standpoint, Mr. Pompeo addressed the U.S. national socio-political divide, noting that while historically the country has been divided before, “a lot more listening needs to take place, and a lot more focus on the central traditions of our country.”
Fireside Chat: A Conversation on the Importance of the Latino Vote in the 2022 Midterm Elections
HR Policy Senior Vice President Shelly Carlin held a fireside chat with Mike Madrid and Chuck Rocha of "The Latino Vote" podcast on the Importance of the Latino Vote in the 2022 Midterm Elections. Notably, both Mr. Madrid and Mr. Rocha have ample experience as political campaign consultants, and are highly regarded as independent voices from within their own parties.
Reaching Latino communities: “We disagree a lot on policy,” Mr. Madrid noted, “but we agree on our community. We both want the best for our communities.” Both felt this is at the heart of reaching out to Hispanic populations, which are now the second largest ethnic voting group in the United States and will be an ethnic plurality within the United States in the foreseeable future. Connecting policy priorities to the stories of their families and communities, where migration to the U.S. is in many cases a living and highly important memory, has produced election results for both parties.
Shades of purple? Latinos make up the fastest-growing segment of non-college educated Americans, the panelists noted, and are rising into the middle class, positioning the Republican party to make inroads. However, in states with less upward mobility and high income inequality particularly for Latinos, such as California, the Democratic party still has an edge.
Culture shift: Mr. Madrid and Mr. Rocha discussed the media habits of Latino voters, which are quickly diversifying as younger Latinos assimilate into American culture and become more comfortable with English-speaking media sources. In addition, the prevalence of women leaders among Latinos, particularly in terms of elected officials, may signal a trend for the rest of the country as the Latino population grows as a percentage of the total U.S. population.
A New Era of Labor Relations: Employer Responses to the Rise of Employee Voice
HR Policy Senior Vice president Shelly Carlin led a panel exploring the ways employers are making their voice heard as we see a rise in employee voice, which happens to coincide with labor shortages and pressing economic issues such as inflation and stagnating wages.
Worker expectations are shifting: Ms. Fisher noted that for frontline workers, the overwhelming feedback is not just for flexibility, but work-life balance, with less forced overtime and workers desiring to fully unplug during days off. Mr. Murphy said that a proactive approach to these issues has worked well within his company, with channels for internal constructive dissent leading to selectively staking out positions to create consistency within the company’s approach.
Politics, unions, and companies: Mr. King discussed polling by the American Compass that found most workers desire apolitical representation focused on pay, benefits, training, and other issues specific to the workplace. The lack of such an option has turned many workers away from unions. Ms. Liebman noted that unions may be willing to back off from such issues if corporations would do the same, but that younger generations are concerned with more than the traditional terms and conditions of employment.
Are we in a renaissance for unions? Ms. Liebman noted that we are seeing renewed vitality of employee voice, and are in a time of innovation and experimentation with regard to employee voice. Ms. Fisher followed up by observing that there is a real possibility that workers will merely strike for better wages rather than go through the unionization process, as Mr. King noted the real appetite and need for alternatives to traditional Wagner Act unions. Mr. Murphy observed the heightened utilization of corporate social media platforms such as Slack to fuel these efforts.
Local strikes are a thing of the past: Ms. Fisher stressed that modern media, including social media, has extended the reach of union activity and increased the risk profile of reputational harm in the midst of union activity. Now, it is critical to game plan for needed messaging to be able to respond to attacks in real time.
Limited Legislative Activities with More Agency Regulations - Policy Outlook by HRPA Staff
In-house HRPA experts explored important HR-related public policy issues in play and shared the Association’s advocacy and practice agenda on issues including pay data disclosure requirements, HR data privacy, labor and employment law developments, and healthcare policy.
The panel was joined by Tim Bartl, President and CEO, HR Policy Association, Ani Huang, Senior Vice President, HR Policy Association, President and CEO, Center on Executive Compensation, Daniel Chasen, Vice President, Workplace Policy, HR Policy Association, Gregory Hoff, Associate Counsel, HR Policy Association, Roger King, Senior Labor and Employment Counsel, HR Policy Association, and Margaret Faso, Director of Health Care Research and Policy, American Health Policy Institute and HR Policy Association, and was moderated by Chatrane Birbal, Vice President, Government Relations, HR Policy Association.
Pay data disclosure confusion ahead: A recent report by the National Academies of Sciences, Engineering, and Medicine examining the quality of EEO-1 Component 2 compensation data noted that such data is of limited use in meeting any of the EEOC’s objectives and suggested that the organization needs to be more effective in collecting data in order to identify pay gaps. Ms. Huang pointed out the resulting challenges for employers, including that it is not clear what data would be required to be disclosed and it could cause confusions with the expected diversity disclosure mandate under the SEC’s forthcoming human capital metrics disclosure rule. Other concerns include a short timeframe to comply with a notice from the SEC and possible investors’ requests that companies disclose their Component 2 data, much like the EEO-1 form.
On the labor and employment side, Mr. Roger and Mr. Hoff provided insights on DOL’s expected rulemakings on the overtime exemption threshold and independent contractor status. They also covered significant decisions that the NLRB is expected to make this fall. These changes could have critical impacts on employers as employee expectations shift.
Ms. Faso stated that employers can expect a few key regulatory actions on mental health parity, transparency in coverage, and surprise medical billing. In addition, the Inflation Reduction Act excludes private plans and will leave employers at risk of drug price increases.
The Future of Health Equity, Wellbeing, and DE&I
Employers are playing an increasingly important role in addressing and advancing health equity for their employees—but with so many factors in play, it can be difficult to know where to start. In a panel moderated by American Health Policy Institute President and CEO Mark Wilson, experts and HR Policy members explored the drivers of disparities in health equity and the first few steps companies should take to promote and advance equitable wellbeing benefit programs for employees.
Think outside the box on ways to address equity: Tracey Grabowski, Chief Human Resources Officer, Procter & Gamble Company, shared several examples of programs Proctor and Gamble and their brands have put into place to address health equity. This includes financial planning programs for employees to address the disparities in building wealth between black and white Americans as financial wellbeing is intimately linked with health outcomes. In addition, Ms. Grabowski displayed several videos highlighting these efforts, including the Always brand’s leadership in ending “period poverty” globally (see video below).
Employers can play a role in improving social determinants of health: Nicole Kelm, Senior Director of Strategy and Operations, Deloitte Health Equity Institute, outlined the many factors that impact an individual’s health and wellbeing that are outside of the realm of health care benefits, like housing, transportation, and food security, otherwise known as social determinants of health. Employers that are really focused on truly addressing overall health equity need to make sure they are addressing these external factors. Ms. Kelm stressed that many employers already hold enough data to make a positive impact, it is just about taking action to use this data creatively.
Engage clinicians in the process: Rhonda Randall, D.O., Executive Vice President & Chief Medical Officer, UnitedHealthcare, encouraged companies to have someone with clinical insight reviewing this data so that any programs put in place have a clear health outcome goal. Dr. Randall stated the importance of having one foot in the present and another foot in the future to make lasting change. High school graduation statistics have links to future wellbeing so focusing on programs in your communities that increase graduation rates can have a major impact on the overall wellbeing on future generations.
The Role of the Corporation in Society: The Pushback Against ESG
Manhattan Institute for Policy Research Senior Fellow and Director of Legal Policy James Copland joined HR Policy Association President and CEO Tim Bartl for a fireside chat on the delicate position of corporations caught in an increasingly heated ESG debate. Amid mounting attention to ESG issues by many institutional investors and policymakers, companies also need to respond to a growing sentiment against ESG led by certain state and federal Republican lawmakers and certain business leaders who argue that ESG initiatives and investment alternatives will undermine company long-term financial performance and negative impact state pension funds.
Mr. Copland offered several insights around the pushback, explaining that much of the criticism is not against the corporations themselves and their internal ESG priorities, but rather directed at the agendas pursued by large investors through the creation of their new “socially responsible” funds. Mr. Copland, who has followed ESG issues as part of hosting his organization’s Proxy Monitor shareholder proposal database, suggested that ESG fund managers need to demonstrate why the higher fees are warranted and ensure they are not misleading retail investors with repackaged index funds under an ESG label.
Mr. Bartl raised the concerted effort by some lawmakers, including the attorneys general and state comptrollers in Texas, Florida, West Virginia, and Arizona, who have advocated against ESG investments in state employee pensions and retirement funds. When asked whether this dissent is about investment returns or politics, Mr. Copland expressed his view that it is a combination of both. The states have a fiduciary responsibility to offer quality investments for their employees from both a fee and return perspective and it is reasonable for a plan sponsor to carefully evaluate the long-term performance of these ESG funds. Notwithstanding this, from a political perspective these states are trying to protect their industries and using opposition to ESG to do so.
Where does that leave companies? Many organizations now find themselves in a difficult place, pushed and pulled among all their stakeholders. Employees may express the desire to invest in socially responsible funds but may not realize the implications of doing so from a return perspective. And, as companies strive to be good corporate citizens and show a positive impact on the environment, they will continue to face pressure from opponents who feel it is not aligned with their ultimate goal of providing financial returns to shareholders.
Disney and Starbucks: Lessons Learned About Employer Responses to Employee Voice
A panel moderated by former White House Press Secretary and Bully Pulpit Interactive Senior Counsel Robert Gibbs discussed a topic that all employers have dealt with—increasing employee expectations for companies to speak out on issues, and what to do when the employee voice and employer voice do not align.
Disney and Starbucks most recently experienced the fallout that can occur when employees disagree with their employer’s public and internal stance on an issue. Jena McGregor, Senior Editor, Forbes argued that while this trend has increased in conjunction with the Great Resignation, the drivers of these changing expectations are not new. Social media has revolutionized the way information spreads and has emboldened employees to engage more with their employers on expectations surrounding corporate “voice.”
Paulette Alviti, Executive Vice President and Chief People Officer, Mondelez International, Inc. discussed how part of the change in how they communicate comes as a response to the pandemic. The “new normal” has been that everything is in constant flux, from how we work to the top policy priorities employees are engaged on. Establishing your company values so they can serve as a guidepost makes these day-to-day decisions easier and aides in communicating decisions to employees. Ms. Alviti offered key steps employers should ask when choosing whether to weigh in on an issue:
- Increase employee listening,
- Determine whether your company is in the right position to weigh in, and
- Determine whether this is an issue you should speak out on, even if it means you will be speaking out alone.
With 80% of the general public now wanting CEOs to be on the forefront of policy issues, David Marriott, Chairman of the Board, Marriott International, Inc. further stressed the importance of having a “true north” when making decisions. In addition, core values that put people first—whether that is your employees or your customers—allows the board to focus on areas of importance to employees and customers, as well as ensure leadership is approaching a policy topic with the insight of those the policy may impact.
Ms. McGregor added that it’s important for employers to take the time to get ready for when policy issues come into play and to update their playbooks for how the company will respond to both internal and external issues. Delayed responses are a main driver of increased frustration on the part of employees and the public.
Closing out the session, Mr. Gibbs said employers should take the time to determine if using their voice on an issue is the right step, arguing that sometimes the tendency is to do and say something on everything and this can come across as disingenuous. And when the company does decide to use their voice on an issue, mistakes will inevitably happen, so be willing to admit mistakes during the process.