The price of deregulation? Each change can cost $100K, employers report
- A Future Workplace-Kronos Workforce Institute survey found that every regulatory change amounts to $100,000 in compliance costs for the businesses polled. The survey gathered responses from 800 HR and payroll executives from various U.S. companies.
- Two-thirds of those polled said that compliance has become costlier in the last year, and 74% said compliance costs more now than it did a decade ago. In response to the Trump administration's deregulation plans, 64% of those polled said they expect deregulation to bring complex changes, while 14% said they expect changes to be less complex.
- The study also found that about 50% of respondents feel they aren't allowed enough time to prepare for new employment rules. Quartz says labor proposals can take as little as 60 to 90 days to become law, and that organizations are expected to abide immediately by the new rules. Nearly half of the survey respondents said they need between 120 and 150 days to prepare for regulatory changes.
As much as businesses favor less regulation, deregulation that comes swiftly, as in the case of the Trump administration reversing Obama-era rules, comes with its own burdens. Regulatory changes can be especially costly for small businesses with limited financial and administrative resources, even if the change ultimately removes responsibilities.
Already, the Trump administration has postponed the fiduciary rule, ended its defense of the Obama-era overtime rule and switched stances on Title VII, now stating that the law does not protect LGBT employees from discrimination. A stand-still on H-1B and H-2B regulation has also left some employers in the lurch.
HR assumes much of the burden of reviewing and implementing new rules, as well as communicating policy changes and enforcement measures. Deregulation might be the desirable endgame, but the cost of getting there in a hurry can be a burden itself.