Foot Locker 2014 Annual Report Download - page 31

Furthermore, recent regulations shorten the election process, significantly reducing the time between the filing
of a petition and an election being held. These regulations and recent decisions could impose more labor
relations requirements and union activity on our business conducted in the United States, thereby potentially
increasing our costs, which could negatively affect our profitability.
Health care reform could adversely affect our business.
In 2010, Congress enacted comprehensive health care reform legislation which, among other things, includes
guaranteed coverage requirements, eliminates pre-existing condition exclusions and annual and lifetime
maximum limits, restricts the extent to which policies can be rescinded, and imposes new and significant taxes
on health insurers and health care benefits. Due to the breadth and complexity of the health care reform
legislation and the large number of eligible employees who currently choose not to participate in our plans, it
is difficult to predict the overall effect of the statute and related regulations on our business over the
coming years. Due to the health care law changes, some eligible employees who had historically not chosen to
participate in our health care plans have found it more advantageous to participate in our plans effective
January 1, 2015. Such changes include tax penalties to persons for not obtaining health care coverage and
being ineligible for certain health care subsidies if an employee is eligible for health care coverage under an
employer’s plan. If a larger number of eligible employees, who currently choose not to participate in our plans,
choose to enroll over the next few years, it may significantly increase our health care coverage costs and
negatively affect our financial results.
Legislative or regulatory initiatives related to global warming/climate change concerns may negatively
affect our business.
There has been an increasing focus and significant debate on global climate change, including increased
attention from regulatory agencies and legislative bodies. This increased focus may lead to new initiatives
directed at regulating an as-yet unspecified array of environmental matters. Legislative, regulatory, or other
efforts in the United States to combat climate change could result in future increases in taxes or in the cost of
transportation and utilities, which could decrease our operating profits and could necessitate future additional
investments in facilities and equipment. We are unable to predict the potential effects that any such future
environmental initiatives may have on our business.
We may be adversely affected by regulatory and litigation developments.
We are exposed to the risk that federal or state legislation may negatively impact our operations. Changes in
federal or state wage requirements, employee rights, health care, social welfare or entitlement programs, such
as health insurance, paid leave programs, or other changes in workplace regulation could increase our cost of
doing business or otherwise adversely affect our operations. Additionally, we are regularly involved in various
litigation matters, including class actions and patent infringement claims, which arise in the ordinary course of
our business. Litigation or regulatory developments could adversely affect our business operations and financial
performance.
We operate in many different jurisdictions and we could be adversely affected by violations of the
U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws.
The U.S. Foreign Corrupt Practices Act (‘‘FCPA’’) and similar worldwide anti-corruption laws, including the
U.K. Bribery Act of 2010, which is broader in scope than the FCPA, generally prohibit companies and their
intermediaries from making improper payments to non-U.S. officials for the purpose of obtaining or retaining
business. Our internal policies mandate compliance with these anti-corruption laws. Despite our training and
compliance programs, we cannot be assured that our internal control policies and procedures will always
protect us from reckless or criminal acts committed by our employees or agents.
Our continued expansion outside the United States, including in developing countries, could increase the risk
of FCPA violations in the future. Violations of these laws, or allegations of such violations, could disrupt our
business and result in a material adverse effect on our results of operations or financial condition.
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