🔒PFAS will be increasing concern for manufacturers in year ahead

As we head into 2024, here are three trends that manufacturers of all sizes should be watching.

Environmental health and safety

PFAS — perfluoroalkyl and polyfluoroalkyl substances — have been on the scene for years now, but we expect to see exponential growth in all things PFAS in 2024.

Governmental and private party PFAS investigations have significantly increased and, as they say, when you look for PFAS, you find them.

PFAS have been detected in a significant number of public drinking water systems, wastewater treatment facilities, private wells, surface water bodies, fish tissues and elsewhere, both in Connecticut and nationally.

Federal and state governments are also increasingly requiring manufacturers and distributors to report whether there are any PFAS in the products they make, use or distribute.

All of this investigation and reporting will lead to increased governmental and regulatory knowledge and awareness of the presence of PFAS in the environment and in a wide variety of products.

With this increased knowledge comes increased regulatory, scientific and legal action.

The Environmental Protection Agency has made addressing PFAS exposure a federal enforcement priority for 2024-2027. In addition, EPA plans to list two PFAS compounds, perfluorooctanoic acid and perfluorooctanesulfonic acid, as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act.

This will significantly increase the EPA’s ability to require PFAS investigations across the country. And when PFAS are found, remediation typically must occur to minimize public exposure.

Increased knowledge of the presence and potential harms associated with PFAS has increased litigation around the country. This litigation trend will continue to increase as we become increasingly aware of the ubiquity of these compounds.

Labor inclusion and retention

Over the last few years, there has been an increased focus on diversity, equity, inclusion and belonging (DEIB) in the workplace.

Manufacturers have engaged in training, coaching, town halls and events aimed at increasing dialogue, and other initiatives that engage employees across the workforce.

A range of available statistics show that Generation Z (born in late 1990s to early 2000s) views gender expression and identity very differently than prior generations, in that they are more open in their perspectives and statistically have higher rates of identifying as non-binary, among other identifications.

There have been societal and also legal shifts with regard to views on sex and gender.

Just a few years ago, the Supreme Court greatly expanded its interpretation of “sex” as it relates to discrimination prohibited under federal anti-discrimination law, to include sex, gender identity, gender expression, transgender status and sexual orientation.

The generational views of sex and gender expression/identity are critically important for employers and supervisors to understand because they can impact an employer’s ability to: attract employees who are searching for an inclusive workplace; manage competently; and engage respectfully and with understanding as it relates to this aspect of employee identity.

The focus on gender/sex will increase and, with it, so will the need for training, coaching, benefits reviews, policy revisions, and similar changes in aspects of human resources.

Corporate compliance

COVID-19 exposed the weaknesses in our global supply chains and in the business-to-business contracts that drive the entire system.

Manufacturers need to review their long-term agreements or standard terms and conditions if they sell “purchase order to purchase order.”

Most manufacturers are on high alert for business and/or legal terms that can significantly impact their margins, legal rights, etc.

What has changed in the past few years that will only increase in 2024? The rise in the use of contractual templates.

Companies — big and small — are looking for ways to make their contracting process more “efficient,” and thus, everyone is pulling out a template that has been approved up the chain of command.

These templates are filled with contractual clauses — some that make sense and others that do not. These templates also contain clauses that often have no relevance to the actual contractual negotiation that is going on.

Templates have made contracts longer in length — not shorter. And, because of all the extraneous language and clauses that are included to make the template effective, the negotiations are dragging on for months.

Time will tell if the manufacturing industry moves away from the templates to get deals done quicker in 2024 and beyond.

Megan Baroni, Abby Warren and Jeff White are partners at Robinson+ Cole LLP. They lead the firm’s manufacturing law practice and oversee the Manufacturing Law Blog.

Check out the rest of HBJ's 2024 economic forecast issue