FEDERAL UPDATES

FTC/Noncompetes – The FTC’s ban on nearly all noncompete agreements continues to be battled out in the courts.  In a ruling that surprised many, a PA judge declined to issue an injunction.  A Texas court is expected to rule on a summary judgment motion, but likely not until late August.  There is a new lawsuit filed in Florida.  The ban is currently scheduled to take effect September 4, and requires that FTC-compliant notices be sent to all current and past employees who are subject to a noncompete.  Employers may want to start reviewing their files and contracts to create a list of people who may be entitled to notice so they are ready to comply by September 4 if the ban goes into effect.

Increased I-9 Fines – DHS published a final rule that increases fines for failing to comply with I-9 requirements.  Examples include fines ranging from $281 to $2,789 for each Form I-9 error, from $698 to $5,579 for knowingly employing an unauthorized employee (first offense), and from $230-$2,304 for “document abuse” (asking for specific documents or more or different documents after an employee has already presented sufficient documentation).  Fines are often for each form and employee, so they multiply very quickly.  Employers may want to audit their I-9 forms and processes and consider enrolling in E-Verify as added security. The Form I-9 was significantly updated last year – employers should be using the version that says “Edition 08/01/23” in the bottom left-hand corner.

EEOC – Harassment in Construction.  Based on its findings that (i) women and people of color are rare in construction, creating a heightened risk, (ii) preventing harassment may be critical to safety, and (iii) harassment based on race, sex, and national origin is a significant barrier to recruiting and retention, the EEOC recently published best practices specifically for the construction industry.  It lists five key principles for preventing harassment in construction:

• strong and comprehensive anti-harassment policies;
• leaders who are committed to maintaining a culture in which harassment is not acceptable;
• consistent and demonstrated accountability;
• trusted and accessible complaint procedures; and
• regular, interactive anti-harassment training tailored to the audience and the organization.

The EEOC further recommended that project owners require bids to include a plan to prevent and address workplace harassment and that general contractors include corresponding provisions in their agreements with subcontractors and staffing agencies.

The agency further recommended that general contractors:

• provide an anonymous hotline to receive complaints from all onsite workers;
• confirm that every subcontractor has established its own complaint channel;
• conduct anonymous worker surveys on a regular basis to determine whether harassment is occurring;
• provide an anti-harassment policy written “in all languages commonly used by workers at the site,” posted in easy-to-see places; and
• require each onsite employer to notify the general contractor about any harassment complaints they receive.

Employers in the construction industry may want to review the EEOC guidance, their employee handbooks and policies, and their contracts with other entities to prevent harassment and ensure the strongest possible defense to an EEOC harassment claim.

Workplace Violence Prevention – Even if employers aren’t subject to a state requirement to develop a formal workplace violence prevention plan, they still may want to evaluate their workplace and develop a plan to keep employees safe.  OSHA recently cited a Florida behavioral health company under the General Duty clause for failing to take action to ensure employee safety (and failing to report a hospitalization within 24 hours), and imposed a fine of $101,397.

STATE/LOCAL UPDATES

Arizona – Minimum Wage.  Two potential changes may be coming to Arizona minimum wage requirements.  Raise the Wage Arizona recently submitted signatures for a proposed ballot measure to raise the state minimum wage from $14.35 to $18 per hour by 2026, with increases based on CPI thereafter.  If verified, it would be included on the state ballot on Nov. 5.  Also on the ballot (and passed by the legislature but not yet signed or vetoed by the Governor and challenged in court) will be a measure to allow Arizona employers to pay tipped workers $10.76 per hour (or 25 percent less than the minimum wage), as long as they earn at least $2.00 per hour more than the minimum wage with tips included. Under current law, employers may pay a tipped employee $11.35 per hour, if the tipped employee earns at least $14.35 per hour with wages and tips combined.

California

New Whistleblower Poster.  Under existing California law employers are required to post a list of employees’ rights and protections under whistleblower laws, but up until now, there has been little guidance as to exactly what the posting should include.  The Governor just signed AB 2299, which will require the Labor Commissioner to provide a model notice that fulfills employers’ obligations.  Employers can still use their own notice but will lose the certainty of guaranteed compliance. The notice form is expected by the end of the year.

Worker’s Compensation Poster.  The Governor signed AB 1870, which adds a new disclosure to the Worker’s Compensation poster by informing employees that “the injured employee may consult a licensed attorney to advise them of their rights under workers’ compensations laws. In some instances, attorney’s fees may be paid from an injured employee’s recovery.  Employers should be sure to update their posters by January 1, 2025.

New Jersey

Reimbursement of Business Expenses.  In a claim arising from an unemployment insurance case, a New Jersey Appellate Division court indicated for the first time that an employee may have a claim under the New Jersey Wage Payment Law if an employer requires the use of their vehicle without reimbursement for costs associated with that use.  While the case was remanded for further fact-finding, the court explicitly noted that requiring the use of a personal vehicle without reimbursement effectively transfers the employer’s operating expenses to the employee and therefore is an illegal diversion of wages.

Mandatory “Retire Ready” Registration.  New Jersey passed the Secure Choice Act several years ago, and it is now going live. Employers with 25+ employees who have been in business for at least two years and do not offer a qualified retirement plan to employees must register and facilitate contributions for employees who do not opt-out.  Employers with 40+ employees have an implementation deadline of September 15, 2024, and may incur penalties if they fail to register by June 15, 2025.  Employers with 25-39 employees have an implementation deadline of November 15 and may incur penalties if they fail to register before August 15, 2025.  The state is in the process of mailing out notices; employers who receive a notice but believe they are exempt are instructed to go to the website and submit for an exemption.

Massachusetts – Pay Transparency, and Reporting (eff. 2/1/25).  Massachusetts is expected to join the pay transparency movement once the Governor signs recently passed legislation (as expected shortly).  It would require 25+ employers to disclose the salary range on job postings, and provide pay range information to employees offered a promotion or transfer.  Unlike some other states, it would not require disclosure of bonuses or benefits. In addition, it would require private 100+ employers to submit their annual EEO-1 data report to the Secretary of the Commonwealth by February 1 each year.

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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.