FEDERAL UPDATES

Federal Contractors

• Pay Transparency:  The Biden administration just released a notice of proposed rulemaking that would prohibit federal contractors from using a job applicant’s prior salary history when setting pay and, like a growing number of states and localities, require them to include the salary range and a general description of benefits and other compensation in job postings. The rule also currently requires that contractors “ensure” that applicants are provided with a specific notice of the requirements as part of the job announcement or application process. The proposed rule was published in the Federal Register on January 30, and the public comment period runs through April 1.  No immediate action is required but federal contractors and subcontractors should anticipate a final rule later this year and begin preparing by reviewing their compensation structure and pay bands.
• Successor Hiring Obligations:  The Department of Labor just published a Final Rule implementing Executive Order 14055, Nondisplacement of Qualified Workers Under Service Contracts, effective February 12, 2024.  It is intended to prevent disruption to federal services by requiring a successor contractor covered by the Service Contract Act to hire or offer a right of first refusal to the predecessor’s employees when a government contract expires and a follow-on contract is awarded.

ADA Lawsuits 2023:  According to a recent Seyfarth Shaw analysis, federal ADA lawsuits in 2023 significantly declined from a record high in 2021, but still exceeded 8,200 for the second year in a row.  The overall decline may be due to more plaintiffs filing in state courts (which were not included in the study), more settlements with EEOC, or the demise of a few law firms known to aggressively pursue ADA cases.  New York (2,759) and California (2,380) were the most active states for federal ADA litigation, with Florida (1,415) coming in third.  Other states with significant cases (but fewer than 225) were Texas, Illinois, Pennsylvania, Tennessee, Missouri, Georgia, and New Jersey.

STATE/LOCAL UPDATES

California – Pay Data Reporting:  The California pay data portal opened on February 1, and reports must be submitted by May 8.  Since early 2020, employers with at least 100 employees have been required to submit annual pay data reports to the Civil Rights Department as part of the state’s efforts to enforce equal pay.  The requirements were expanded in 2022 to include “labor contractor employees” and to also require reporting of median and mean hourly rates within each job category for each combination of race, ethnicity, and sex.  This year CRD expanded the requirements even more by issuing a new template that includes a section for data showing the number of employees in each group who work onsite, remotely from California, and remotely outside of California.  Updated FAQs were just released on February 1 on CRD’s website: PDR FAQs – 2023 Reporting Year | CRD (ca.gov).  Employers should be gathering their data for both payroll employees and labor contractors and should be sure to use the CRD’s updated template and guidance when submitting reports this year.

Maryland – FAMLI:  The 2022 legislature passed a Paid Family and Medical Leave law in 2022, with contributions set to begin in October 2023 and benefits beginning in January 2025. The 2023 legislature delayed implementation, moving contributions to October 2024 and benefits to January 2026. The current legislature is proposing an additional delay to July 1, 2025, for contributions and July 1, 2026, for benefits, as well as some additional changes and amendments.  Nonetheless, the Maryland Department of Labor is proactively preparing for the day FAMLI does finally arrive by moving forward with draft regulations and opening the comment period for anyone interested in weighing in on the eventual final regulations.

New York:  The last state in the country still requiring employers to provide additional Covid paid sick leave may finally be on the way to ending it effective July 31.  Governor Hochul’s FY25 budget proposes legislation that would sunset the law based on its unclear effect on new businesses and recognition that quarantine requirements have changed since it was initially enacted in early 2020.  Ideally, the legislature will be on board and will pass the repeal in this year’s session.

The proposed budget also includes (i) an expansion of the NY Paid Family Leave to include up to 40 hours of additional paid leave for prenatal appointments, (ii) a “mini-FMLA” leave law to require job protection and benefits continuation for employees eligible for disability benefits, (iii) paid lactation breaks of up to 20 minutes.  While Governor Hochul is responsible for proposing a comprehensive budget, there is no guarantee that the legislature will approve it in its current form.

Oregon – OFLA/PLO Leave Year Alignment:  Beginning July 1, 2024, Oregon employers will be required to align their OFLA leave year with their Paid Leave Oregon leave year if they haven’t already done so.  In many ways, this is a beneficial change as it means both types of leave will run concurrently (in most cases), but it also eliminates the option to elect a different year.  Both will require the “benefit year” to be a rolling forward year beginning on the Sunday before an employee’s first day of leave.  This is a great reason to review and update Oregon employee handbooks to ensure they incorporate the many changes that have been enacted this year to align both types of Oregon leave

Employers may want to consider also changing their FMLA leave year to align with the required Oregon leave year to ensure that they all run concurrently to the extent they overlap.  Otherwise, employees may qualify for Oregon OFLA/PLO for part of the year, and then FMLA for another part of the year.  Changing the FMLA leave year requires 60 days’ notice to employees, so to meet the July 1 Oregon leave alignment deadline employers should be prepared to provide notice to employees by May 1, 2024.  Employers will need to allow employees to use the most beneficial method during the 60 transition period and should be cautious about adverse impacts around this time.

As a reminder, there are several options for calculating the 12 months under FMLA, each with its benefits and pitfalls regarding the potential for stacking, indefinite intermittent leave, and ease of administration:

• Calendar year, or other fixed 12 months period
• Looking forward to the first day of leave
• Looking backward from the first day of leave

Failing to select a method at all generally results in using the most beneficial outcome for the employee.

Washington D.C. – Pay Transparency (eff 6/30/24): D.C. will soon join several other states (and federal contractors) by requiring all employers with at least one employee in D.C. to provide the minimum and maximum wage range in all job listings and position descriptions (including promotions and transfers), disclose healthcare benefits before the first interview, eliminate inquiries into wage history, and post a notice disclosing these rights to employees.  Fines start at $1,000 for the first violation, move up to $5,000 for the second violation, and can be as high as $20,000 for subsequent violations.

If you’d like to speak to an Asure HR expert about your business, connect with us.

Asure Software provides this information for general information purposes only.  We are not attorneys, and the information in this update should not be relied upon or regarded as legal advice.  This information may not be accurate or complete as it relates to a particular company or situation, and does not reflect all developments or laws in all jurisdictions.