Perspectives
Employment Law Prep for 2024
Get ready for a new year filled with changes to the employment law landscape. As we step into 2024, there is a fresh wave of regulations and requirements heading our way, and it’s crucial to have your HR and Compliance teams up to date on the laws taking effect in 2024 that will impact their business. Let’s explore some of the major changes set to unfold in 2024 and the notable changes and potential repercussions from being non-compliant.
Exempt Salary Threshold Increase
On August 30, 2023, the U.S. Department of Labor announced their plan to increase the exempt salary threshold from $684 per week to $1,059. Employees will need to earn $55,068 or more per year to be exempt from overtime pay. Before we discuss the steps employers should consider taking to prepare for this proposed plan, it’s important to note that this proposal isn’t law yet. That means there is time to understand and plan for the changes if and when they become law.
A great first step is to review your pay practices and start to prepare for compliance.
How many of your employees fall under the “white-collar” exemption? Qualifying employees will meet the following criteria:
- Paid on a salary basis
- Paid at least the designated minimum weekly salary
- Perform certain duties
This new threshold amount is a significant jump from the current guidelines, so it will likely require some planning on your part if you have multiple employees that make less than the proposed amount. Be sure to review exempt employees and ensure job positions meet the associated duties test.
Another recommendation is to give employees plenty of notice on the changes, and discuss the plans with the leaders of the employees impacted by the change.
Plan to provide a written communication to each employee about the specific changes to their compensation and what new responsibilities come with the changes, such as timekeeping, meal and rest breaks, and other requirements. Some states require advance notice of wage changes, so you should check your local requirements.
As previously mentioned, making sure exempt employees meet the duties test is a vital step of planning.
A summary of the basic requirements under federal law for the white-collar exemptions are as follows:
Executive Exemption
- The employee’s primary duty must be to manage the enterprise or customarily recognized department/subdivision
- Employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent
- The employee must have the authority to hire or fire employees, or the employee’s suggestions and recommendations as to hiring, firing, or any other change of status must be given particular weight
Administrative Exemption
- The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or its customers
- Employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance
Professional Exemption
- The employee’s primary duty must be the performance of work requiring advanced knowledge, predominantly intellectual in character and which requires the consistent exercise of discretion and judgment
- The advanced knowledge must be in a field of science of learning
- The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
Last, and certainly not least, you should evaluate applicable state laws. Your state may have higher, stricter, or different wage and hour requirements than this federal proposal. For example, some states have a higher salary threshold for the white-collar exemptions than the FLSA’s $684 per week. Others might have different exemptions or exceptions, including those where the salary exemption related to practicing medicine. And of course, some states (and cities!) have higher minimum wage rates and/or overtime-type requirements.
New Marijuana Laws
As the legality of recreational marijuana has evolved, so have the regulations regarding marijuana in the workplace. California has officially, and for the first time, provided protections for users of recreational marijuana within the employment context. This new bill, which takes effect on January 1,2024, amends the Fair Employment and Housing Act (FEHA) by making it unlawful for an employer to discriminate against an applicant or employee for the use of marijuana off the job and away from the workplace and for an employer-required drug screening test that finds the person to have non-psychoactive cannabis in their system. (This is the THC left behind in the body after the “high” feelings have left. Indicating that marijuana has been consumed in some capacity in the last few weeks.) Essentially, this bill prohibits employers from holding it against applicants if the test determines there is evidence of past marijuana use. The general intent of employment related drug testing is to test for impairment on the job/at the jobsite, versus long-term use. If the trend started by California continues, traditional and common tests for marijuana will no longer be used for pre-employment drug screening or be the basis for discipline or termination of an employee.
Importantly, California’s AB 2188 will not take away an employer’s right to maintain a drug-free workplace. You can continue to issue disciplinary actions against employees who possess or use cannabis on the clock.
- Exemptions include:
- building and construction employees
- Applicants or employees hired for positions that require federal government background investigations or security clearances
- Applicants or employees required to be tested under state or federal law
The state of Washington also implemented new marijuana laws taking effect January 1, 2024. The new law does not prohibit employers from:
- Basing initial hiring decision on scientifically valid drug screening methods that do not include non psychoactive cannabis metabolites
- Maintain a drug and alcohol-free workplace
- Complying with employer obligations required by federal law
- Testing for controlled substances other than pre-employment, such as post-accident testing or testing because of a suspicion of impairment or being under the influence
- Testing a job applicant for a spectrum of controlled substances, including cannabis, only if the cannabis results are not provided to the employer
Effective January 1, 2024 the law does not apply to applicants seeking a position:
- Requiring a federal government background investigation or security clearance
- in law enforcement, fire protection, or the airline or aerospace industries
- as a first responder or corrections officer
- That is a safety-sensitive position for which impairment while working presents a substantial risk of death, if the employer identified the position as safety-sensitive before the applicant’s application for employment
Paid Family and Medical Leave
Colorado employers are already well aware of their new Paid Family and Medical Leave laws, as they were required to begin contributing to the benefit on January 1, 2023. Beginning January 1, 2024, employees may start using the benefit. Employees can use the paid leave up to 12 weeks in the application year for:
- Birth
- Adoption
- Foster care placement
- Care for a family member with a serious health condition
- Qualifying exigency related to a family member being on active duty
- Certain purposes related to employee or employee’s family member experiencing domestic violence, harassment, sexual assault, or stalking.
Employees may take an additional 4 weeks for a serious health condition related to pregnancy or childbirth complications.
New Pay Transparency Laws
New transparency laws around salary history and how salaries are shared in the workplace and in job postings are just one way legislation is pushing for a more open and accountable workplace. Several states have laws taking effect in addressing this issue.
- Minnesota became the 29th state to prohibit employers from inquiring into an applicant’s salary history. (Taking effect January 1, 2024)
- Oregon created a private right of action for employees to seek damages for an employer’s violation of the salary history ban. (Goes into effect January 1, 2024)
- Colorado signed S 23-105, which expands notification requirements in Colorado’s Equal Pay for Equal Work Act beyond “promotional opportunities” to “job opportunities”, eliminating any arguments that a posting is not required because an opportunity is not promotional.
Hawaii enacted legislation that impacts how employers post open job positions. SB 1057 (taking effect January 1, 2024) will:
- Require most employers with 50 or more employees to disclose a position’s hourly rate or salary range in certain job postings
- amend existing equal pay requirements by prohibiting an employer from paying employees in any protected category of the state’s employment discrimination statute less than it pays other employees for “substantially similar work” instead of “equal work”.
OSHA Changes
Employers across various industries are bracing themselves for changes as OSHA publishes a final rule in July, 2023 amending its regulations to require certain employers in designated high-hazard industries to electronically submit injury and illness information to OSHA. Among the amendments, which take effect January 1, 2024, is a new requirement that employers with 100 or more employees in certain high-hazard industries to electronically submit information from their Form 300–Log of Work-Related Injuries and Illness, and Form 301-Injury and Illness Incident Report to OSHA once a year. These submissions are in addition to submission of form 300A-Summary of Work-Related Injuries and Illness. Click here to read the final rule as published.
According to OSHA, the “high-hazard” establishments include, (but are not limited to) manufacturing, grocery stores, agriculture construction, transportation, warehousing and storage, performing arts, and retail. A full list of the “high-hazard” industries can be found here. These requirements apply to establishments covered by Federal OSHA as well as establishments covered by states with their own occupational safety and health programs.
Miscellaneous Changes
California
The Industrial Welfare Commission is back.
IWC is the administrative agency that was established to regulate wages, hours, and working conditions in California. It’s job is to meet by January 1, 2024 to convene industry-specific wage boards and adopt orders specific to wages, hours, and working conditions in such industries.
Colorado
Colorado enacted the Job Application Fairness Act (JAFA), effective July 1, 2024, which prohibits employers from requesting or requiring that job applicants provide information related to “age, date of birth, or dates of attendance at, or graduation from an educational institution’ on initial employment applications.
Connecticut
Connecticut’s “An Act Expanding Workers’ Compensation Coverage for Post-Traumatic Stress Injuries for All Employees” which expands the definition of employee to allow nearly all workers (not just first responders) who suffer certain tragic qualifying events to claim workers’ compensation benefits, effective January 1, 2024.
Illinois
Governor J.B. Pritzker signed SB 2034, the Child Bereavement Leave Act (also known as Zachary’s Parent Protection Act. The new law requires employers with at least 50 employees provide between 6 and 12 weeks unpaid leave (depending on employer size) for employees who have lost a child due to suicide or homicide. The law becomes effective January 1, 2024.
Effective January 1, 2024 Illinois will require private employers to provide a minimum of 40 hours of annual paid leave to employees to be used for any reason. Employers can choose to frontload the leave on the first day or employment or a designated twelve month period or use an accrual method. Employers may not require any documentation or certification of the need to take leave. Employers may require up to seven days’ notice if the leave is foreseeable and set a reasonable minimum of increment of no less than two hours per day.
The Illinois DOL published Paid Leave for All Workers Act FAQ, which provides guidance on the state’s Paid Leave for All Workers Act. (Effective January 1, 2024).
In the dynamic landscape of ever-evolving employment laws, staying ahead of regulatory changes is vital for a business to thrive-it has become clear that compliance is not only a legal obligation, but a strategic one as well. By entrusting the responsibility of staying up to date on your HR and compliance needs to legal professionals well-versed in employment law, businesses can simplify complexities efficiently, saving both time and money. Beyond those benefits, outsourcing mitigates the risks associated with regulatory compliance, shielding organizations from potential legal repercussions.