HR Public Policy Outlook for the Final Months of the112th Congress “It’s Crunch Time!” Michael Layman and Bob Carragher July 25, 2012

HR Public Policy / Washington Outlook 2 Presidential Job Approval Ratings July of Fourth Year Gallup November 2012 Election

HR Public Policy / Washington Outlook 3 Congressional Productivity The 112th Congress — this Congress — is the last bar on the right.

HR Public Policy / Washington Outlook 4 Not All Spending Is Created Equal Mandatory Spending Is Consuming More and More of the Budget Source: Financial Management Service Bureau of the United States Department of Treasury; Congressional Budget Office Historical Budget Data, Total 2011 Spending – $3.598 Trillion Projected Spending $700 $227 $646 $725 $480 $275 $545 In Billions * ** In Trillions $6 $4 $2

HR Public Policy / Washington Outlook 5 Health Care Reform  Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act (PPACA) on June 28, 2012  Implementing regulations are being promulgated  Efforts to “repeal and replace” will continue regardless of who controls Congress or the Administration In 2013, a Romney Administration and as few as 50 Senate votes could repeal any budgetary provision through budget reconciliation Public Policy Agenda 2012

HR Public Policy / Washington Outlook 6 Health Care Reform

HR Public Policy / Washington Outlook 7 Taxes and Benefits  Fiscal Cliff Bush tax cuts expire – December 31, 2012 Statutory spending caps – Sequestration – January 2013 through 2021 Debt limit increase – Jan/Feb 2013 Public Policy Agenda 2012

HR Public Policy / Washington Outlook 8  Introduced by Representatives Sam Johnson (R-TX) and Richard Neal (D-MA) in March 2012  The legislation would extend and make permanent Internal Revenue Code Section 127, which allows an employer to provide up to $5,250 per year tax-free in tuition, fees, and books to employees for courses on the undergraduate and graduate levels  Currently, Section 127 is set to expire on December 31, 2012  SHRM is the co-chair of the Coalition to Preserve Employer Provided Educational Assistance Employee Educational Assistance Act of 2012 (H.R.4137)

HR Public Policy / Washington Outlook 9 Employment Verification  Federal government’s voluntary employment verification program, E- Verify, expires on October 1, 2012 Public Policy Agenda 2012

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HR Public Policy / Washington Outlook 12 Republican & Democratic Conventions

HR Public Policy / Washington Outlook 13  As of today, only 6 states and the District of Columbia remain in session – California, Massachusetts, Michigan, New Jersey, Ohio and Pennsylvania.  Looking back, it’s been a pretty quiet year in the states too – unlike the previous 2 years.  Legislation mandating the use of E-Verify (Pennsylvania), curbing the use of Credit Checks (Vermont becomes the 8 th state to enact limitations), dealing with Right-to-Work (Indiana), and allowing employees to store Weapons at Work in their vehicles parked on company property have become law.  The hot HR topic for 2012 – restricting employer access to Social Media Passwords from applicants/employees. Maryland became the first state to enact a law (Illinois, California, and possibly others likely to follow suit) State Legislative Issues Snapshot

HR Public Policy / Washington Outlook 14 Plan for the Remainder of 2012  I will be reaching out to the State Legislative Directors in those 6 states to see if they would be interested in advocating on 1 or more of the bills pending before their legislatures relating to the HR topic areas we track.  To date, we’ve assisted 8 state councils in advocating in 13 issues on the state level this year.

HR Public Policy / Washington Outlook 15 Bob Carragher Government Affairs Michael Layman Government Affairs