Is It Time To Rethink Our Employment Law In The US?

There is a common misconception that because the US and UK share a common language that they share a commonality of law. However, employees in America simply do not have the same employment rights as those in the UK or any other major financial district for that matter.

While the UK has a very high level of statutory employment law outlining rights for employees with regards to holidays, working hours, overtime, notice period, paid parental leave, sick leave, unfair dismissal and redundancy, the US has barely any legislation that protects its employees. There is no legal requirement for a contract, no legal safety net and simply an Employment-at-Will doctrine which determines that any US employee is at will and can be terminated without notice or pay at any given time.

The UK is not alone in its offering of protection either. Alongside basic fundamental protection outlined by the European Union, countries such as Austria, Finland and Germany all offer incredible benefits to employees including 43 days of annual leave, 54 days of paternity leave and a national minimum wage, respectively. Three things that do not exist in a US market.

With almost every other financial hub ramping up their efforts to retain top talent during what is being broadly described as the Great Resignation, is it time for America to follow suit?

According to the US Government, 4.5M employees resigned from their role in November 2021. The highest monthly record in more than 20 years and a similar pattern has followed in the Family Office world with wrong hires not returning to the office after the pandemic.

With more opportunities than candidates and professionals willing to make a move to better their work-life balance, Family Offices will be doing everything they can to retain the top Family Office talent and while offering benchmarked compensation, long-term incentive plans, upskilling, balance and growth, the pandemic has taught candidates everywhere that life can change in an instant and upskilling will not protect them in the wake of another variant.

A change to law would not only protect employees either. The lack of notice period often equates to a lack of loyalty in the US leaving organisations and specifically, Family Offices, with a hole in their resources and exposure to a data breach with information taken away by anyone who leaves the office. Longevity is the single most required characteristic of a Family Office hire and without the lengthy notice periods or contracts we see in Europe, American Family Offices are unprotected, exposed and dangerously under resourced.

It is arguably for this reason that we are seeing a global awakening to change in the USA.

It was recently announced that the US and Canada will be joining large parts of the UK and Europe in a four-day working week trial. The initiative led by Boston College and researchers from Oxbridge is trying to determine if employers can gain more by letting their employees work less and it is a movement that if adopted, will certainly attract more talent and go a long way to retaining them.

It is ground-breaking and on-trend movements like these that are leading a broader conversation about US employment law. From April 2022 for instance, employers in New York will have to display salary bands in job descriptions. A movement that also started on LinkedIn will, it is hoped, protect candidates from both wasting their time and being undervalued as part of the recruitment process.

The bill gives the New York City Commission on Human Rights (NYCCHR) the power to issue rules and regulations and enforce the law while also setting precedent to all other US states bar Colorado which has already implemented a similar rule. It also progresses legislation in Maryland, Washington, California, Nevada, Connecticut, Rhodes Island and Ohio which all offer salary ranges upon application, interview or job offer – arguably several steps too late.

While ensuring lesser or higher paid candidates are not wasting their time during the application process, this once again helps organisations by being able to navigate a much smaller and much more relevant talent pool. This also ensures that when hiring a professional, they are fully aware and aligned with the post, its duties and its reward, removing this as a future obstacle standing in the way of their performance or retention.

A rethink of our employment law in the US will be a mutually-beneficial win for employees and employers, particularly Family Offices but is the new openness to change a sign of things to come in the conversation about US employment law and if it is, what would you like to see changed?