Bill Overview
Title: No Tax Deductions for Workplace Harasser Buyouts Act
Description: This bill modifies the tax deduction for trade or business expenses to deny a deduction for payments made to any employee in connection with the termination of employment if a factor in the termination was sexual assault, sexual harassment, sexual misconduct, or workplace harassment based on race, color, national origin, religion, sex, disability, or other specified factors.
Sponsors: Rep. Maloney, Carolyn B. [D-NY-12]
Target Audience
Population: Individuals affected by workplace harassment buyout practices
Estimated Size: 10000000
- Workplace harassment based on various factors is an issue globally, affecting many employees across different industries.
- Reports indicate that a significant percentage of employees experience sexual harassment or discrimination at some point in their careers.
- According to studies, about 20% of employees globally have experienced workplace harassment including sexual harassment at some point in their career.
- The legislation targets a business practice that is common across many companies worldwide, particularly in larger corporations that frequently engage in buyouts to settle harassment claims without admission of wrongdoing.
- Tax deduction laws are specific to national contexts, however, the act may influence international standards by setting a precedent.
Reasoning
- This policy is expected to see moderate to high impacts primarily on individuals who have faced harassment or work in environments where harassment is prevalent.
- The policy primarily affects businesses financially, but its operational impact might indirectly benefit employees by encouraging companies to handle harassment issues more ethically.
- The estimated population affected by this act is large, given the significant prevalence of workplace harassment claims in the US, though not everyone in this group will see immediate changes in wellbeing.
- Wellbeing impacts will vary considerably based on industry, company culture, individual involvement in harassment settlements, and company response to the policy enforcement.
- Some employees might not feel direct improvements until company cultures internally shift to adhere better to the removal of these tax deductions.
Simulated Interviews
Corporate Lawyer (New York, NY)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- I see this policy as a way to push companies to rethink how they settle harassment cases.
- It's crucial for fairness and corporate accountability, hence promoting a healthier work environment.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 7 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Software Engineer (San Francisco, CA)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 7.0 years
Commonness: 5/20
Statement of Opinion:
- I think it's a step in the right direction but will wait to see if it actually changes workplace culture.
- Could lead to less fear in reporting harassment, knowing companies might face financial hits.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Human Resources Specialist (Austin, TX)
Age: 29 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- This can potentially make companies like ours enforce stricter compliance and better training. It's needed.
- Knowing the company has to be accountable financially might change internal attitudes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Middle Manager (Atlanta, GA)
Age: 39 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- The threat of financial repercussions might make my bosses take reports more seriously.
- May reduce the pressure on middle management to brush off minor reports if financial stakes are known.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Small Business Owner (Chicago, IL)
Age: 50 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 3/20
Statement of Opinion:
- This doesn't really impact me directly since my business handles issues directly and ethically.
- In the broader spectrum, it's a good move but seems aimed more at larger companies.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Union Representative (Detroit, MI)
Age: 27 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- It could empower more people to come forward if they know there’s a financial disincentive for companies to cover up.
- Union support might increase knowing there’s legal backing to claims.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Corporate Executive (Seattle, WA)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 2/20
Statement of Opinion:
- Financial penalties might force deeper reflections on corporate culture and prevention strategies.
- It’s a bit of a forced hand but necessary in many cases.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Recent Graduate and Entry-Level Worker (Miami, FL)
Age: 22 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 7/20
Statement of Opinion:
- It's a positive move and provides some peace of mind entering a potentially uncertain corporate environment.
- Hopeful that if buyouts become costly, companies will reform their ways internally.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Retired Corporate Trainer (Orlando, FL)
Age: 55 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- Retired too soon to feel the direct impact, but it's a forward-thinking approach.
- Could increase responsibility and seriousness in training programs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
University Professor (Boston, MA)
Age: 52 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- I see it as an essential deterrent to unethical buyouts and a step towards a healthier workplace culture.
- The potential increase in transparency and accountability will trickle down positively across sectors.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Cost Estimates
Year 1: $20000000 (Low: $15000000, High: $25000000)
Year 2: $18000000 (Low: $14000000, High: $22000000)
Year 3: $20000000 (Low: $15000000, High: $25000000)
Year 5: $22000000 (Low: $17000000, High: $27000000)
Year 10: $26000000 (Low: $21000000, High: $31000000)
Year 100: $50000000 (Low: $40000000, High: $60000000)
Key Considerations
- Enforcing the disallowance of these deductions will require oversight to ensure compliance, potentially increasing IRS operational costs.
- Businesses may attempt to circumvent this policy by redefining settlements outside the scope of the tax disallowances.
- The policy might indirectly reduce harassment incidents if companies proactively change workplace environments to avoid costly settlements.
- Long-term savings are contingent on effective enforcement and business adaptation.