We are half-way through 2024 and it has already been a busy and fast-paced year. The ever-evolving employment law landscape can feel daunting. New regulations and legal interpretations develop regularly, making it challenging for employers to stay informed and remain compliant.
This summer, at the state and local levels, employers have new requirements related to discrimination, leaves of absence, and child labor as examples. Around July 1st, there are more than 20 minimum wage increases in seven states and the District of Columbia. There have also been key developments at the federal level which increase employers’ obligations.
Let’s look at what’s been going on with regards to employment law with a few of the federal agencies.
U.S. Department of Labor (DOL)
Wage and Hour Division
One of the biggest requirements for employers this year, has been the new rule raising the Fair Labor Standards Act’s (FLSA) minimum annual salary threshold for overtime pay eligibility in a two-step process. On July 1, 2024, the minimum standard salary level increased to $844 per week (equivalent to $43,888 per year), and on January 1, 2025 will increase to $1,128 per week (equivalent to $58,656 per year). The rule has had a few legal challenges but as of this writing has not been blocked for private employers.
On March 11, 2024, the DOL's final rule revising the Department’s guidance on how to analyze who is an employee or independent contractor under the FLSA took effect. Under the new rule, the DOL considers six factors when examining the relationship between a potential employer and worker. These factors are the degree of permanence of the work relationship; the nature and degree of control over the performance of the work; the worker’s opportunity for profit or loss; the use of the worker’s skill and initiative; investments made by the worker and the employer; and the extent to which the work performed is an integral part of the employer’s business.
U.S. Department of Labor (DOL)
Occupational Safety and Health Administration (OSHA)
On July 2nd, the DOL released a proposed rule to help protect millions of indoor and outdoor workers from extreme heat. The proposed rule would require employers to develop a Heat Injury and Illness Prevention Plan to mitigate hazards in the workplace impacted by excessive heat. Once the rule is published in the Federal Register, the public will be able to submit written comments.
Effective July 19, 2024, OSHA updates its Hazard Communication (HazCom) Standard to improve the amount and quality of information on labels and safety data sheets (SDSs).
In an effort to promote workers’ involvement in its workplace inspections, as of May 31, 2024, OSHA is allowing employees to designate third parties – including union representatives or community organizers – to accompany the agency during its inspections.
National Labor Relations Board (NLRB)
While ultimately struck down this spring by a U.S. District Court judge, the joint employer threshold would have been expanded to have made even indirect or unexercised control over essential terms and conditions of employment part of joint employer status. Even when only one of the joint employers had exercised sole and complete control over each aspect of its employees’ essential terms and conditions, the other joint employer, would have been required to participate in the collective bargaining process.
The NLRB continues their high caseload. During the 1st six months of Fiscal Year 2024 (October 1- March 31), union election petitions filed at NLRB field offices rose 35% over the same period the previous fiscal year. Information on petitions and the election process can be found on the NLRB’s website here.
Federal Trade Commission (FTC)
Under a new Federal Trade Commission (FTC) rule, for-profit employers will soon be prohibited from entering or enforcing noncompete clauses in their restrictive agreements. The rule is planned to take effect on September 4, 2024.
According to the new prohibition, it will be considered an unfair method of competition for an employer to: enter into or attempt to enter into a noncompete agreement with any employee; maintain a noncompete agreement with an employee; or represent to an employee, other than a senior executive with an existing noncompete, that the employee is subject to a noncompete agreement.
The new rule has been challenged. A Texas federal judge on July 3rd blocked the FTC from enforcing its rule banning noncompete agreements against the plaintiffs in the case only - tax preparation company Ryan LLC and the U.S. Chamber of Commerce - and suggested the regulation should be shot down. The court did not issue a nationwide injunction. Even if the national rule is eventually disallowed, employers still face restrictions at the state level.
On June 28th, the U.S. Supreme Court overruled the Chevron Doctrine that has been in place for over 40 years. The Chevron Doctrine afforded federal agencies a degree of discretion in interpreting ambiguous laws in their areas of expertise. Due to the reversal, courts may not defer to an agency’s interpretation of the law because it is ambiguous. Instead, they “must exercise their independent judgment when deciding whether an agency has acted within its statutory authority.” The decision does not change anything regarding prior cases that relied on the Chevron framework, but it does open the door for new challenges to agency actions. Judges in different jurisdictions will hand down decisions on the same issue, which can cause huge compliance headaches for a multistate employer.
A proactive approach to compliance can save your organization time, money, and legal headaches down the road. Clients of FrankCrum have access to a team of experts. Click here to learn how FrankCrum can help you.
