Perspectives

As we approach 2025, employers face a host of new legislative changes that could significantly impact workplace policies, practices, and budgets. Staying ahead of these changes is not just about avoiding penalties-it’s about fostering a compliant, inclusive, and future-ready workplace. Below are five key areas employers should focus on, along with insights into how they can prepare effectively.

Stay Ahead of New Poster Requirements

Mandatory workplace posters are a simple but crucial compliance requirement. With changes in federal and state laws, updated posters often reflect new employee rights and employer obligations. Employers should monitor for updates to ensure their postings are current. Noncompliance can lead to fines, not to mention the risk of employee claims stemming from lack of information.

Be Ready for Even More Pay Transparency

Pay transparency laws are expanding, with states requiring employers to disclose salary ranges in job postings, promotions, and even during annual reviews. These laws aim to close wage gaps but also add layers of complexity to hiring and compensation strategies. Employers need to evaluate their pay structures, ensure consistent practices, and prepare for increased scrutiny.

Keep an Eye on Emerging Paid Leave Laws

From parental leave to paid sick leave, state and local governments continue to introduce new paid leave laws. These laws not only affect policy creation but also payroll systems and employee handbooks. Employers should stay updated on new mandates and consider how to balance compliance with operational needs.

Plan for Big Minimum Wage Hikes

Minimum wage increases are sweeping the country, with some states and cities enacting annual adjustments tied to inflation. These changes can significantly impact payroll budgets, especially for businesses with large hourly workforces. Employers should strategize how to mitigate the financial impact, whether through workforce planning, price adjustments, or operational efficiencies.

Create Clear Policies for AI in the Workplace

As artificial intelligence (AI) tools become more prevalent in hiring, performance management, and operations, employers must establish clear policies to address their ethical and legal use. Laws surrounding AI in employment are emerging, particularly around bias, data privacy, and employee monitoring. Employers should proactively set policies that balance innovation with fairness.

The Importance of Partnering with Legal Experts

Navigating these legislative changes is no small feat. The nuances of new laws, the pace of change, and the potential for penalties make it essential to work with trusted legal counsel.

Partnering with experts helps employers:

• Interpret and implement laws correctly.
• Develop compliant policies tailored to their industry workforce.
• Avoid costly litigation by identifying and addressing risks proactively.

Final Thoughts

2025 promises to be a transformative year for workplace legislation, but with the right preparation, employers can turn compliance challenges into opportunities. By staying informed and seeking expert guidance, businesses can not only meet legal obligations but also build workplaces that attract and retain top talent.

If you’re looking for support to navigate these changes, reach out to our team at WFJ. Our legal experts are here to help you stay ahead and compliant in the ever-changing employment landscape.

On December 3, 2024, a federal court in Texas issued a nationwide preliminary injunction blocking the enforcement of the Corporate Transparency Act (CTA). The court ruled that the CTA is unconstitutional, meaning businesses are not currently required to comply with the reporting deadlines.

For now, this ruling means that:

• Companies formed before January 1,2024, are not required to file their beneficial ownership information by the general deadline of January 1, 2025.
• Companies formed on or after January 1, 2024, are not required to meet the 90-day reporting deadline after their formation date.

It’s important to note that this is a preliminary injunction. The decision could be appealed to a higher court, and the injunction may be lifted or overruled. At the time of this post, FinCEN-the agency responsible for enforcing the CTA-has not publicly addressed its plans following the court’s decision.

Ongoing Legal Challenges

The Texas case isn’t the only one questioning the constitutionality of the CTA. In Alabama, another federal court also ruled the law unconstitutional but limited the ruling to the plaintiffs in that case. The government has appealed this decision to the Eleventh Circuit Court of Appeals.

The outcome of these cases is uncertain. The Eleventh Circuit could affirm or reverse the Alabama court’s ruling, or it could send the case back to the lower court without deciding on the constitutionality of the law. Whether this happens before the January 1, 2025 deadline is unknown, as is whether any ruling would apply nationally or only to specific parties.

What Should Businesses Do?

Given the legal uncertainty, WFJ recommends that businesses continue preparing to comply with the CTA’s reporting requirements:

• If your company was formed before January 1, 2024, be ready to file your beneficial ownership information by the January 1, 2025, deadline.
• Companies that fail to comply-if the law is ultimately enforced-could face serious penalties, including criminal and civil consequences.

Our team is closely monitoring developments in these cases and any updates from FinCEN. If you have questions about your compliance obligations or how this ruling might impact your business, WFJ is here to help.

Stay informed and protected-reach out to us today for guidance.

The American’s with Disabilities Act (“ADA”) requires employers to provide an employee with a disability with a reasonable accommodation to allow the employee to perform the essential functions of the job. The obvious question then becomes…what is a reasonable accommodation? This question frequently leaves employers feeling stuck and struggling to identify a reasonable accommodation. However, the Job Accommodation Network (“JAN”) is a great resource for employers. JAN’s website–AskJAN.org–offers creative and effective accommodations for employees with disabilities. JAN’s one objective is to find and share effective workplace accommodation solutions to employers to allow employees to get back to work.

JAN’s website now offers a search tool call the “Situations and Solutions Finder” that gives employers more than 700 accommodation ideas to offer employees with disabilities. The ideas included in the Situations and Solutions Finder tool are real-world examples of accommodations that employers have given their employees. The Situations and Solutions Finder tool lets employers search for accommodation scenarios by filtering the search results by disability, limitation, and/or occupation. For example, if you search “Sleeping/Staying Awake” in the “Limitations” filter, you will see examples of how an employer provided an employee with sleep apnea a small device called the Doze Alert that fit in the employee’s ear and made a noise whenever the employee’s head started to drop forward at work, or how offering a standing desk for an employee with narcolepsy may be a reasonable accommodation for the employee.

The Situations and Solutions Finder tool is a helpful resource employers can use to satisfy their obligations under the ADA. The ADA requires employers to engage in the “interactive process” when an employee requests an accommodation or when the employer knows the employee has a disability and needs accommodation. The interactive process is a fancy legal phrase that simply means the employer and employee must engage in an informal discussion to discuss the employee’s work limitations caused by the disability and what reasonable accommodation, if any, will allow the employee to effectively perform the essential functions of the employee’s job. 

Employers often think there is no reasonable accommodation it can offer an employee.

When employers are stuck in finding a reasonable accommodation, the Situations and Solutions tool is a great resource to turn to. Remember, a reasonable accommodation does not mean the “best” accommodation or the accommodation the employee prefers. Rather, a reasonable accommodation means the accommodation allows the employee to effectively perform the essential functions of the job. 

Navigating the complexities of reasonable accommodations under the ADA can be challenging for employers, but resources like JAN and its Situations and Solutions Finder tool can make the process more manageable. However, ensuring your organization’s policies align with ADA requirements and that your HR professionals and leaders are well-versed in the latest tools and strategies is critical to compliance and fostering an inclusive workplace. Don’t leave these important matters to chance. Consult with an experienced attorney to review your policies, provide tailored guidance, and deliver training to your team. Together, we can ensure your organization is prepared to meet its obligations and support employees effectively.

The Corporate Transparency Act (CTA) is quickly approaching its critical deadline, and it’s essential for all LLC owners to take action now. Starting January 1st, 2025, certain business entities will be required to file beneficial ownership information with the Financial Crimes Enforcement Network (FinCEN) or face steep penalties. If your business is subject to the CTA, now is the time to ensure you’re compliant.

Why the Deadline Matters

The January 1 deadline isn’t just a suggestion-it’s a hard cutoff. Businesses that fail to comply with the CTA could face severe penalties, including fines up to $10,0000 or imprisonment for up to two years. Missing this deadline could put your business at significant risk, and the consequences of non-compliance are steep.

Preparing now to meet the CTA requirements ensures that your business stays on the right side of the law and avoids unnecessary complications. Don’t wait until the last minute-act today to stay compliant and protect your business.

Is Your Business Ready?

Under the CTA, many businesses, including LLCs, corporations, and other entities formed under state law, must report their beneficial owners. These are the individuals who own or control at least 25% of the company or have substantial control over its operations. If you’re unsure whether your business needs to report, it’s crucial to seek legal advice to determine your compliance obligations.

The CTA’s requirements apply to a wide range of businesses, so even if you think your business might be exempt, it’s worth confirming your obligations. Compliance isn’t optional, and getting it right can save you from future headaches.

How Can WFJ Help?

At Wagner, Falconer & Judd, we’re here to help you through the complexities of the CTA and ensure your business is prepared for the upcoming deadline. Here’s how we can help:

• Assessment and Planning: We’ll help you assess whether your business needs to report under the CTA and create a plan to gather the necessary information.
• Accurate Reporting: We’ll guide you in accurately identifying and documenting your beneficial owners to meet FinCEN’s strict filing standards.
• Ongoing Support: The CTA’s reporting obligations are not a one-time event. As your business evolves, we can provide ongoing support to ensure continued compliance beyond January 1, 2025.

Don’t Wait-Act Now

The January 1, 2025 deadline is fast approaching, and it’s crucial to prepare early. By partnering with WFJ, you can ensure your business is ready to meet its obligations and avoid costly penalties. Our experienced legal team is ready to help you navigate the CTA’s requirements so you can focus on running your business with confidence.

Contact us today to schedule a consultation and take the first step toward compliance. Time is running out-don’t let this deadline sneak up on you!

Ensuring timely and accurate lien filing is a critical part of securing payments and protecting company revenue. However, with the complexities of state-specific lien laws and strict filing deadlines, managing the lien process internally can be fraught with challenges that put even the most organized teams at risk. Outsourcing lien filing to professionals, particularly legal experts, can provide much-needed relief and strategic advantages.

Here’s when you should consider it-and why partnering with a law firm can safeguard your interests.

The Challenges of In-House Lien Management

Credit professionals face numerous obstacles in managing liens, including:

• Complex and Varied State Laws

Each state has unique lien laws governing what qualifies for a lien, notice requirements, filing deadlines, and the duration of the lien’s validity. Missing a step or misunderstanding a state-specific requirement can invalidate your lien, leaving your company unprotected.

• Strict Deadlines 

Many states have short and unforgiving deadlines for filing preliminary notices, liens, and other associated documents. Balancing these deadlines with other pressing financial duties increases the likelihood of errors.

• High Stakes

An improperly filed lien doesn’t just cost your company money; it can strain relationships with clients and business partners, damaging future opportunities.

• Resource Constraints

Even the largest companies are often stretched thin managing accounts receivable, disputes, and other tasks. Taking on lien filing adds an additional layer of responsibility that can overwhelm internal teams.

Key Benefits of Outsourcing Lien Filing to Legal Professionals

Bringing in a law firm with expertise in lien law can alleviate these pain points and position your company for success. 

• State-specific Expertise

Legal professionals stay up-to-date with state-specific lien requirements and legislative changes, ensuring that filings comply with all laws and regulations.

• Deadline Management

A dedicated legal team will ensure that notices and filings are submitted on time, mitigating the risk of losing lien rights due to missed deadlines.

• Accurate Documentation

Attorneys can handle the meticulous preparation of lien documents, reducing the likelihood of disputes over improper filings.

• Strategic Advisory

Beyond filing liens, legal counsel can advise on how to structure contracts to strengthen lien rights and improve your position in case of disputes or non-payment.

• Improved Efficiency

Outsourcing lien management allows your team to focus on core responsibilities without sacrificing lien protection or compliance.

When to Make the Switch

Consider outsource lien filing if:

• Your company operates in multiple states, each with different lien laws.
• Your team struggles to meet the deadlines associated with preliminary notices and lien filings.
• You’ve experienced errors or invalidation in past lien filings.
• You’re expanding into new markets with unfamiliar lien laws.
• Your team has a high workload, and lien filing is becoming a distraction from core financial tasks.

Why Partner with a Law Firm for Lien Filing?

While some companies may consider lien service providers, partnering with a law firm offers an unparalleled advantage: comprehensive legal protection. The attorneys at Wagner, Falconer & Judd don’t just file liens; they provides advice on how to prevent payment disputes and protect your company’s rights under the law.

At WFJ, we specialize in helping you secure your business through effective lien filing and legal counsel. Our team is experienced in state-specific lien laws and deadlines, ensuring your company is always protected.

Don’t let the complexity of lien filing jeopardize your revenue. Contact us today to learn how we can streamline your lien processes, so you can focus on growing your business with confidence.

Take Action

If you’re ready to reduce risk and maximize efficiency, we’re here to help. Reach out to WFJ to schedule a consultation and take the first step toward stronger lien protection.

A recent ruling from a federal judge in Texas has blocked the Department of Labor’s attempt to raise the salary threshold for employees to qualify for exemption from overtime pay under the Fair Labor Standards Act (FLSA). This decision has significant implications for businesses and worker alike, particularly regarding how exempt status is determined for employees in executive, administrative, and professional (EAP) roles.

The FLSA and the EAP Exemption 

The FLSA mandates that covered employers pay employees at least the federal minimum wage and provide overtime pay for hours worked over 40 hours in a week. However, the law includes an important exception for EAP employees, meaning those in executive, administrative, or professional roles may be exempt from these requirements.

For employees to qualify for this exemption, they must meet certain criteria, which the Department of Labor (DOL) defines through regulations. One of these criteria is the salary level. The DOL periodically updates this salary threshold, and in its 2024 Rule, the Department aimed to raise the minimum salary for exempt employees to a higher level.

The 2024 Rule and the Court’s Decision

On November 15, 2024, a Federal Judge in Texas ruled against the DOL’s 2024 Rule, which had raised the salary threshold for EAP employees. The first phase of the rule, which took effect on July 1, 2024, increased the salary level from $684 per week ($35,568 annually) to $844 per week ($43,888 annually). This change would have made approximately one million employees who were previously considered exempt eligible for overtime pay.

The court ruled that the DO exceeded its authority under the FLSA by using a “salary -only” approach to determine whether an employee is exempt. According to the ruling, the FLSA requires the DOL to consider the duties of employees, not just their salary level, when applying the EAP exemption. The judge found that the department’s rule did not properly account for the role and responsibilities of the employee, violating the scope of authority granted by Congress.

What About the Other Phases of the 2024 Rule? 

The 2024 rule included additional phases that had not yet taken effect. The second phase was set to raise the salary threshold to $1,128 per week starting January 1, 2025. The third phase would have implemented automatic increases to the salary threshold starting in 2027 without requiring notice or public comment. The court also found the provisions to be beyond the DOL’s authority, finding that the Department lacked the power to make these changes unilaterally.

What Does This Mean for Employers?

If your company had already raised employee salaries outlined in the 2024 rule, you are not in violation of the law by rolling back those increase. However, it’s important to note that you cannot ask employees to return the additional pay they received, as that could lead to legal and reputational issues.

It’s also worth considering the impact that lowering salaries might have on employee morale. While the legal ruling may allow businesses to revert to the previous salary levels, doing so could cause dissatisfaction and erode trust within the workforce.

Could the Biden Administration Appeal?

While the decision may seem final, the Biden Administration could still choose to appeal the ruling, although a reversal seems unlikely. The court’s decision was notably supported by the Supreme Court’s ruling earlier this year in Loper Bright Enterprises v. Raimondo. In that case, the Supreme Court overturned decades of precedent by overturning what is known as Chevron deference, which had previously allowed agencies like the DOL considerable discretion in interpreting the laws they enforce. Now, courts are required to exercise their own judgement in determining whether an agency has stayed within its statutory authority. Given the court’s reliance on Loper Bright, it seems highly unlikely that the ruling will be overturned.

Conclusion

The Texas federal judge’s decision to strike down the Department of Labor’s 2204 salary threshold increase is a significant development for businesses and employees affected by the FLSA’s overtime and minimum wage exemptions. While the ruling halts the planned increases, employers must be careful about reversing salary adjustments that were already made. moreover, the possibility of an appeal remains, but the likelihood of a reversal is slim in light of recent Supreme Court decisions. Employers should continue to monitor the situation and ensure their compensation practices align with current legal standards.

A well-structured performance management process is a vital tool for employers. Not only does it help align individual contributions with organizational goals, but it also boosts employee engagement, productivity, and long-term success. Here’s a guide for employers on crafting a performance management strategy that not only drives performance but also fosters a fair, supportive workplace.

Key Elements of an Effective Performance Management Process

1. Continuous Performance Development: Performance management is not a one-time event; it’s a continuous cycle of identifying, measuring, and developing employee performance. By consistently communicating expectations and offering opportunities for improvement, employers can create a culture of transparency and fairness.
   • Open Communication: Effective performance management starts from the hiring stage. Clearly communicate job descriptions, work rules, and performance standards. This sets the stage for employees to understand what is expected of them.
   • Timely Feedback: Provide employees with regular, constructive feedback. Don’t wait until a formal review; let them know where they stand and offer guidance on how to meet performance standards.
   • Documentation: Keep detailed notes of all discussions. Document the date, people involved, and a summary of the conversation. For instance, “On May 15, I advised Frank that his error rate for processing claims is 5%, which is above the acceptable range. We discussed strategies for improvement.”
2. Aligning Individual Performance with Organizational Goals: An effective process ensures that each employee’s performance aligns with the larger organizational objectives. This fosters a sense of purpose and accountability, empowering employees to understand how their role contributes to the company’s success.
   • Establish Clear Goals: Set measurable, achievable goals that align with the company’s mission. Employees who understand how their goals impact the organization are more likely to feel engaged and motivated.
   • Reduce Legal Risk: When employees are notified of performance issues before termination, they are less likely to file claims. Should a claim arise, written warnings are invaluable for demonstrating that the employer’s actions were justified.
   • Formal Evaluations and Continuous Review: Human Resources (HR) plays critical role in ensuring consistent and fair treatment. HR can review managerial decisions to confirm that they are aligned with the company’s policies and have been handled consistently across similar situations.

Key Components of a Performance Management System

1. Goal Setting: Setting clear and realistic goals is the first step in aligning performance with expectations. These goals provide a roadmap for employees, offering clarity on what they should achieve. When employees are aware of their targets, they are more likely to contribute effectively.
2. Continuous Feedback: Feedback shouldn’t be reserved for annual reviews. Regular feedback-both positive and corrective- helps employees stay on track and feel valued. It’s essential that this feedback is well-documented and timely.
3. Performance Appraisals: Conduct formal evaluations to assess employee’s achievements and areas for improvement. Performance appraisals provide an opportunity to discuss progress, reinforce goals, and address any concerns. Remember, consistency is crucial-similar performance issues should be addressed in a similar manner.
4. Development Plans: Growth opportunities keep employees engaged and motivated. Creating development plans for employees, including training, skill-building, or career advancement opportunities, can enhance loyalty and performance.

Compliance and Legal Protections

An effective performance management process is also a valuable asset for legal compliance. Regular documentation, written warnings, and clear communication can shield employers from potential legal issues. Here are some tips for maintaining a legally compliant performance management system:

• Keep Records: Ensure all performance-related documentation is securely stored in the employee’s personnel file. Notes from 1:1 meetings should be kept in a manager file, and electronic communications should be professional, as they may be discoverable in a lawsuit.
• Involve HR: HR provides an independent review of disciplinary actions, ensuring that they are fair and consistent with company policy.

Partnering with Legal and HR Professionals

Navigating performance management can be challenging, especially when disciplinary action or termination is involved. To manage this process compliantly, work with trusted legal counsel and HR professionals. These experts can guide you in implementing performance management strategies that not only improve productivity but also help you minimize legal risks, fostering a productive and legally sound work environment.