Released October 22, 2024

NEW LAWS ENACTED

  • California Governor Gavin Newsom has signed Senate Bill (SB) No. 1100, legislation that makes it an unlawful employment practice for an employer “to include a statement in a job advertisement, posting, application, or other material that an applicant must have a driver’s license” unless the employer meets certain conditions. The law will take effect January 1, 2025.
  • New Jersey is preparing to adopt final regulations for the Temporary Workers Bill of Rights (TWBR), a law aimed at increasing protections for temporary workers whose primary residences are in New Jersey (regardless of whether they work inside or outside of the state) and ensuring their wages and benefits are aligned with those of non-temporary employees.

PENDING LEGISLATION

  • On Election Day, November 5, 2024, Missouri voters will have the opportunity to vote on Proposition A and decide whether Missouri will become the next state to require employers to provide earned paid sick time (PST) to eligible employees.

COURT & AGENCY NEWS

  • The Fifth Circuit Court of Appeals holds that theS. Department of Labor has the statutory authority to set a minimum salary level for the executive, administrative, and professional (EAP) exemption under the FLSA.
  • The Supreme Court of the United States has agreed to hear a case that will decide whether retirees can sue for disability discrimination because of changes to retiree benefit plans.
  • Following the Michigan Supreme Court’s July 31, 2024 ruling that the state legislature’s December 2018 “adopt and amend” action was unconstitutional, and that the state’s minimum wage will increase in 2025, the court has now clarified what those minimum wage increases will be when the law takes effect on February 21, 2025.

New Laws Enacted

California Passes Law Prohibiting Driver’s License Requirements in Job Postings

On September 28, 2024, California Governor Gavin Newsom signed Senate Bill (SB) 1100 into law, which prohibits employers from including a driver’s license requirement in job advertisements, postings, applications, or other materials unless certain conditions are met. Under the law, an employer may only require a driver’s license if they reasonably expect driving to be one of the job’s functions, and they believe that alternative transportation methods (such as ride-hailing services, taxis, carpooling, bicycling, or walking) would not be comparable in terms of travel time or cost.

The legislative intent behind SB 1100 is to address the disproportionate impact that such requirements have on various groups, including people with disabilities, low-income individuals, and those living in areas with access to public transportation who may not need or want to drive. The law takes effect on January 1, 2025.

New Jersey Finalizes Temporary Workers Bill of Rights (TWBR) Regulations

New Jersey is preparing to release new regulations for the Temporary Workers Bill of Rights (TWBR), a law that increased protections for temporary workers residing in the state and sought to ensure their compensation is aligned with non-temporary employees. Effective since August 2023, the TWBR mandates that temporary workers assigned to third-party employers must receive pay and benefits comparable to those provided to regular employees performing similar work at the same location. This measure aims to prevent wage disparities between temporary laborers and permanent staff performing equivalent tasks under similar conditions. 

The TWBR applies to temporary help service firms operating in New Jersey, even if they place workers with employers outside the state. Under the proposed regulations, workers are covered if their primary residence is in New Jersey, regardless of the location of the third-party client. The New Jersey Department of Labor (NJDOL) dismissed concerns that extending the TWBR’s protections beyond state borders would hinder interstate commerce or reduce job opportunities for temporary workers. It emphasized the state’s interest in safeguarding both individuals living and working within New Jersey.

However, the NJDOL clarified that the TWBR’s requirements do not apply solely based on residency. Temporary help firms must have a business presence or operations within New Jersey for the law to apply. Firms without operations, transactions, or offices in the state will not trigger the TWBR, even if the laborer resides in New Jersey.

Pending Legislation

Missouri Voters to Decide on Paid Sick Time (PST) with Proposition A

On November 5, 2024, Missouri voters will determine the fate of Proposition A, which could make Missouri the next state to require employers to provide earned paid sick time (PST) to employees. If approved, PST will accrue at a rate of one hour for every 30 hours worked, beginning May 1, 2025, for current employees and on the first day of employment for new hires. Employers with 15 or more employees may limit PST use to 56 hours per year, while those with fewer employees may cap use at 40 hours annually. Employees will also be able to carry over up to 80 hours of unused PST from year to year.

Proposition A permits employers to meet the PST requirement through an existing paid time-off (PTO) policy if it satisfies the accrual and usage conditions outlined by the new law. Employees can use PST for their own or a family member’s illness, preventive care, public health emergencies, or for safe leave in cases of domestic violence, sexual assault, or stalking. The law expands the definition of “family member” beyond the federal Family and Medical Leave Act (FMLA), including individuals with whom the employee shares close personal relationships. Employers may require documentation for absences exceeding three consecutive workdays but cannot demand specific details about medical or personal conditions.

Employers will be obligated to provide written notice of PST rights to employees by April 15, 2025, or within 14 days of hiring, and display a poster with the same information. Employers are prohibited from retaliating against employees for using PST or interfering with their rights under the law. Violations of the PST law could result in civil actions, fines, and even criminal liability. The Missouri Department of Labor and Industrial Relations (DOLIR) will oversee compliance, and employees may pursue legal claims directly within three years without first filing an administrative complaint.

Court & Agency News

Fifth Circuit Upholds DOL’s Authority on White-Collar Overtime Exemptions

On September 11, 2024, the U.S. Court of Appeals for the Fifth Circuit upheld the Department of Labor’s (DOL) authority to use a salary basis to define white-collar overtime exemptions. In Mayfield v. U.S. Department of Labor, the court ruled that the 2019 DOL rule, which raised the minimum salary threshold for executive, administrative, or professional (EAP) employees from $455 to $684 per week, was within the DOL’s statutory authority. This decision is a win for the DOL as it defends its new April 2024 rule, which further raises the minimum salary thresholds for EAP exemptions and faces legal challenges from business groups.

In those legal challenges, business groups argue that the new 2024 rule improperly focuses on salary instead of job duties to determine EAP status. That rule raised the minimum salary to $844 per week ($43,888 annually) on July 1, 2024, with a scheduled increase to $1,128 per week ($58,656 annually) on January 1, 2025, and automatic adjustments every three years. A preliminary injunction in the Eastern District of Texas temporarily blocked the rule’s application to the State of Texas, citing a June 2024 Supreme Court ruling that courts must independently assess agency actions. Additional challenges to the rule are currently pending in Texas courts.

The Fifth Circuit emphasized that setting a minimum salary aligns with the Fair Labor Standards Act’s (FLSA) intent, noting that salary distinctions reflect the “white-collar” nature of EAP exemptions. The court concluded that the DOL’s authority to establish salary thresholds has been consistent for over 80 years and fits within the broader FLSA framework, which provides wage protections primarily for lower-paid workers. The ruling affirms the DOL’s regulatory power, despite ongoing legal scrutiny, and underscores the significant compliance challenges the 2024 rule presents for employers, potentially affecting four million employees who would gain overtime eligibility under the new salary thresholds.

Supreme Court to Decide Whether Retirees Can Sue for Disability Discrimination

The U.S. Supreme Court has agreed to hear a case that will determine whether retirees can pursue disability discrimination claims under the Americans with Disabilities Act (ADA) in response to changes in retiree benefit plans. This case involves a former firefighter from Sanford, Florida, who retired in 2018 due to Parkinson’s disease. When she joined the fire department, disabled retirees were eligible for employer-paid health insurance until age 65. However, a 2003 policy change limited the coverage to 24 months for those retiring with less than 25 years of service. The firefighter, who retired after 15 years of service, claims the benefit change violated the ADA.

In October 2023, the U.S. Court of Appeals for the Eleventh Circuit upheld the city’s policy, ruling that the ADA only protects “qualified individuals” capable of performing essential job functions, even with accommodations. The court reasoned that since the firefighter was unable to perform her duties upon retirement, she did not qualify as a “qualified individual” under the ADA and therefore could not pursue the lawsuit. However, the Eleventh Circuit noted a split among federal appellate courts, with some circuits allowing former employees to pursue ADA claims even after leaving employment, while others align with the Eleventh Circuit’s interpretation.

The Supreme Court’s decision will resolve this circuit split and provide clarity for employers and HR professionals regarding whether post-employment benefits fall under ADA scrutiny. Oral arguments for the case have yet to be scheduled, and a final decision is expected by June 2025.

Michigan Supreme Court Clarifies Minimum Wage Increases and Tip Credit Elimination

Following its July 31, 2024, ruling that the Michigan legislature’s 2018 “adopt and amend” action was unconstitutional, the Michigan Supreme Court has issued further guidance on the upcoming changes to the state’s minimum wage. In a September 18, 2024, order in Mothering Justice v. Attorney General, the court confirmed that the law increasing the minimum wage and phasing out the tip credit will take effect on February 21, 2025. The court also adjusted the timeline for the tip credit elimination, setting the final phase-out for 2030 instead of 2029.

With the implementation date approaching, a bill has been introduced in the Michigan legislature, Senate Bill No. 991, which aims to scale back the planned wage increases while retaining the tip credit. The bill was referred to the Senate Committee on Labor on September 11, 2024, for further consideration. If passed, the legislation would alter the minimum wage structure outlined in the court’s ruling.

Disclaimer: this information is not intended as legal advice. Please consult with legal counsel to ensure your organization’s compliance with applicable legal requirements.