Released July 17, 2023

Newsletter Highlights

For full stories, please scroll down.

New Laws Enacted

  • Colorado Governor Polis signed the Protecting Opportunities and Workers’ Rights Act (POWR Act), effective August 7, 2023, which expands the legal definition of harassment to include any “unwelcome” conduct. The new law rejects the judicially-created “severe or pervasive” standard of proof, limits employers’ affirmative defenses, adds marital status to the classes protected from discrimination, limits non-disclosure and confidentiality provisions in employment agreements, and more.
  • Nevada, Oregon, the District of Columbia, twelve California cities or counties, and at least six other cities or counties have increased their minimum wage requirements as of July 1, 2023. The Connecticut minimum wage increased as of June 1. Many local jurisdictions and states also adjust minimum wages for inflation annually. Primarily effective January 1 or July

Pending Bills

  • California‘s Senate has passed a bill which would require every California employer with at least one employee to “establish, implement, and maintain … a workplace violence prevention plan” and “record information in a violent incident log about every incident, post-incident response, and workplace violence injury investigation.” The bill also includes a provision requiring regular training for employees regarding preventing and responding to workplace violence, including active shooter training. If approved by the California State Assembly and signed into law by the governor, the measure would take effect on January 1, 2024.
  • The National Salary Transparency Act has been proposed in the US Congress. As states and municipalities are increasingly adopting pay transparency laws, HR 1599 would require disclosure of compensation ranges in an attempt to reduce pay equity concerns. Covered employers would be required to disclose the wage range for open positions in job postings made publicly and internally.
  • Rhode Island bill (S888), which passed the state Senate last month, would see Rhode Island join a growing number of other states including Indiana, New York, Utah, and Connecticut in introducing bills that would ban non-compete agreements with employees except in limited circumstances. Under a separate bill, Rhode Island Governor Daniel McKee has signed a law that prohibits the use of nondisclosure or non-disparagement agreements regarding civil rights abuses “as a condition of employment.”

Court & Agency News

  • On June 29, 2023, the US Supreme Court issued its decision in Groff v. DeJoy, in which it unanimously created a higher standard for employers to measure the burden a worker’s religious accommodation request would impose on its business before it could deny such request. The Court ruled that “Title VII requires an employer denying a religious accommodation to show that the burden of granting it would result in substantial increased cost in relation to the conduct of its particular business.”
  • The EEOC announced the release of additional guidance regarding the Pregnant Workers Fairness Act (PWFA), enacted in December 2022 and effective June 27, 2023. The new guidance includes educational resources and a revised “Know Your Rights” poster required to be posted in most workplaces. The PWFA requires covered employers to provide “reasonable accommodations” to a worker’s known limitations related to pregnancy, childbirth, or related medical conditions, unless the accommodation will cause the employer an “undue hardship.”

For the full stories, keep reading below.

New Laws Enacted

Colorado’s POWR Act Brings Sweeping Changes to Employee Protections and Workplace Standards

Colorado’s new employment law, Protecting Opportunities and Workers’ Rights Act, known as the POWR Act, brings significant changes to the state’s workplace harassment laws, nondisclosure provisions, and overall employment regulations. The act, signed into law by Governor Polis on June 6, 2023, and set to become effective on August 7, 2023, expands the definition of harassment, imposes limitations on an employer’s affirmative defenses, introduces marital status as a protected category, and establishes stringent requirements for nondisclosure agreements.

Under the POWR Act, the definition of harassment in Colorado no longer requires conduct to be “severe or pervasive” to be illegal, but instead focuses on conduct that is subjectively offensive to the individual and objectively offensive to a reasonable person in the same protected class. This change lowers the threshold for viable harassment claims under the Colorado Anti-Discrimination Act (CADA). However, the Act does set specific conditions which must apply for a harassment claim to be actionable, such as situations where the conduct becomes a term or condition of employment, affects employment decisions, or creates an intimidating or offensive working environment.

The POWR Act also limits the ability of employers to assert affirmative defenses to harassment claims, particularly in cases involving harassment by a supervisor. In order for employers to be able to assert affirmative defenses, employers must establish programs designed to prevent and deter harassment, promptly address complaints, and communicate the complaint and investigation process to both supervisors and nonsupervisory employees.

Additionally, the POWR Act expands the protected categories in Colorado employment law to include marital status as a protected class, prohibiting adverse actions based on marital status. However, certain exceptions related to spousal authority, financial responsibilities, and access to confidential information remain in place.

The Act introduces stringent requirements for nondisclosure agreements (NDAs) in the employment context. NDAs that limit an employee’s ability to disclose alleged discriminatory or unfair employment practices are void unless they meet specific conditions. These conditions include equal application to the employer and employee, a provision allowing disclosure of underlying facts of alleged practices, and the prohibition of employer retaliation for disclosures.

Finally, employers will now be subject to new record-keeping obligations under the POWR Act. They must maintain personnel and employment records for at least five years and maintain a designated repository for written and oral complaints of discriminatory or unfair employment practices.

The POWR Act will take effect on August 7, 2023, and applies to employment practices occurring on or after that date.

Wave of Increases to Minimum Wage Effective July 1

As of July 1, 2023, various states, the District of Columbia, and several local jurisdictions have implemented minimum wage increases. Below is an overview of recent minimum wage increases.

State and District Minimum Wage Increases:

Effective July 1, 2023, several states and the District of Columbia have adjusted their minimum wage rates. Here are some key changes:

  • District of Columbia: The minimum wage in the District of Columbia is now $17.00 per hour.
  • Nevada: Nevada’s minimum wage depends on whether employers offer qualifying health plans. If no health plan is provided, the minimum wage is $11.25 per hour. However, if a qualifying health plan is offered, the minimum wage is slightly lower at $10.25 per hour.
  • Oregon: Oregon’s minimum wage differs based on the employer’s location. Non-urban counties will have a minimum wage of $13.20 per hour, while employers in general areas must pay a minimum of $14.20 per hour. For employers located within the metropolitan Portland urban growth boundary, the minimum wage rises to $15.45 per hour.

Additionally, Connecticut increased its minimum wage to $15.00 per hour on June 1, 2023.

Local Minimum Wage Increases:

Numerous cities and counties across the United States are also adjusting their minimum wages. While some jurisdictions are yet to announce their 2023 rates, here are some notable changes:

  • California: Cities such as Alameda, Berkeley, Emeryville, Fremont, Los Angeles, Malibu, Milpitas, Pasadena, San Francisco, Santa Monica, and West Hollywood will see minimum wage rates ranging from $16.52 to $19.08 per hour.
  • Illinois: Chicago and Cook County (unless a municipality has opted out) will implement minimum wage rates of $15.00 and $13.70 per hour, respectively.
  • Maryland: Montgomery County will have different rates based on the number of employees, with rates varying from $14.50 to $16.70 per hour.
  • Minnesota: Minneapolis will set the minimum wage at $14.50 per hour for businesses with 100 or fewer employees. In Saint Paul, the rates range from $11.50 to $15.00 per hour, depending on the number of employees.
  • Washington: Tukwila will implement varying rates based on the number of employees and annual gross revenue, with rates ranging from $16.99 to $18.99 per hour.

Noncompliance with minimum wage laws can lead to fines and penalties against the employer in addition to owing backpay to employees.

Pending Bills

California Senate Passes Workplace Violence Prevention Bill

Following stalled efforts from CalOSHA to pass regulations regarding workplace violence, California’s legislature is taking steps to enhance workplace safety by proposing Senate Bill (SB) No. 553, which aims to establish new workplace violence prevention standards in the state. The bill addresses issues such as employee training, incident documentation, and employee confrontations. If passed into law, SB 553 would introduce measures aimed at preventing workplace violence and ensuring employers have procedures for responding to an incident of workplace violence.

Key points of SB 553 as currently amended:

  • Workplace Violence Prevention Plan: The bill would require all California employers, regardless of size, to establish, implement, and maintain a workplace violence prevention plan. Each plan must include written procedures, engineering controls (e.g., electronic access controls, personal alarm devices), work practice controls (e.g., security guards, employee training), and measures to address active shooter situations.
  • Incident Log and Documentation: Employers would be obligated to record information in a violent incident log, which would include details about each incident, post-incident response, and workplace violence injury investigations. This documentation would enable employers to identify trends, assess risks, and take appropriate preventive measures.
  • Restraining Orders and Union Representation: SB 553 would authorize labor unions to seek temporary restraining orders (TROs) on behalf of employees based on workplace violence or credible threats of violence.
  • Training Requirements: The bill emphasizes the importance of training programs for employees. Employers would be required to provide active shooter training and shoplifter training. This comprehensive training would be aimed at equipping employees with the necessary skills and knowledge to respond effectively in high-risk situations while minimizing potential harm.
  • Prohibition on Employee Confrontation: Employers would be prohibited from maintaining policies that require employees to confront active shooters or suspected shoplifters.

National Salary Transparency Act Proposed in Congress

Pay transparency has been gaining traction across the United States, with several states and municipalities enacting laws to promote salary disclosure. In line with this trend, Congresswoman Eleanor Holmes Norton (D-DC) recently introduced HR 1599, also known as the Salary Transparency Act. This proposed legislation aims to amend the Fair Labor Standards Act (FLSA) and would require covered employers to disclose wage ranges in job postings, provide applicants with wage range information, and grant existing employees access to pay scales.

The main provisions of HR 1599 include:

  • Wage Range Disclosure in Job Postings: HR 1599 would require employers to include the wage range for open positions in both public and internal job postings. The definition of “wage range” encompasses salaries, wages, and other forms of compensation. Employers would have flexibility in determining the range, which can be based on pay scales, existing pay ranges, or budgeted amounts for the position.
  • Providing Wage Range Information to Applicants: If an applicant has not been provided with the wage range for a position, employers must disclose it before discussing compensation. Additionally, employers are obligated to furnish wage range information to applicants upon request.
  • Access to Pay Scales for Existing Employees: Under HR 1599, existing employees have the right to obtain the wage range for their position upon hire and at least once a year thereafter. Employers can determine the pay scale based on applicable pay scales, previously determined wage ranges, or the range for incumbents in equivalent positions.
  • Prohibition of Retaliation: The bill prohibits employers from retaliating against applicants or employees who exercise their rights to wage range disclosure. Retaliation would include refraining from or refusing to interview, hire, employ, or promote individuals based on their pursuit of pay transparency.
  • Penalties and Legal Remedies: Violations of the Salary Transparency Act may result in civil penalties ranging from $5,000 for the first offense to $10,000 for subsequent violations. Employers found in violation may also be liable for statutory damages between $1,000 and $10,000 per affected employee or applicant, along with potential attorney’s fees and injunctive relief. The bill introduces a private right of action, enabling individuals to pursue legal claims on behalf of themselves and others in similar situations.

The introduction of HR 1599, the Salary Transparency Act, signals a federal push for pay transparency in the United States and comes on the heels of several states and municipalities already adopting pay transparency laws.

Rhode Island May Become Latest State to Ban Worker Non-Competes; Adopts Anti-NDA Law

In line with a growing trend, Rhode Island has joined the growing number of states that have introduced bills banning or restricting the use of non-compete agreements. Rhode Island has also recently passed a bill which would prohibit nondisclosure and non-disparagement agreements related to civil rights violations.

Rhode Island’s Senate has passed S0888, which now moves to the House. The bill would ban non-compete agreements with nearly all employees. Under current law, Rhode Island prohibits non-compete agreements with low wage employees. If passed, S0888 would effectively end the practice of binding workers to restrictive agreements that limit their ability to seek employment with competitors or start their own ventures. The stated objective of the new law is to foster a competitive job market and empower workers to utilize their skills and knowledge freely.

Rhode Island’s recent legislation aligns with a broader nationwide trend of states enacting laws to restrict or ban non-compete agreements. Several other states, including Connecticut, Indiana, New York, and Utah, have also taken steps to limit the use of these agreements, recognizing their potential to hinder employee mobility and stifle economic growth. This unified effort signals that legislatures across the country increasingly disfavor non-compete agreements.

At a national level, the US Federal Trade Commission has introduced proposed regulations banning non-competes and Congress is currently considering the Workforce Mobility Act which similarly restricts the use of non-compete agreements in an employment context. The National Labor Relations Board issued a memo on May 30, 2023, arguing that non-compete agreements in a large number of circumstances violate the National Labor Relations Act.

In addition to looking to broaden its ban on non-compete agreements, Rhode Island has enacted a separate law expanding worker protections. Governor McKee signed a bill that prohibits the use of nondisclosure or non-disparagement agreements related to civil rights abuses as a condition of employment. This measure aims to ensure that employees can speak out about civil rights violations or unlawful conduct without fear of reprisal.

Court & Agency News

SCOTUS Issues Decision Regarding Religious Accommodations

In a unanimous decision, the United States Supreme Court recently clarified the standard for religious accommodations in the workplace. The case of Groff v. DeJoy addressed the issue of whether employers can deny religious accommodation requests based on the cost to their business. The Supreme Court’s ruling establishes a higher threshold for employers to demonstrate the burden of granting a religious accommodation than before.

Previously, employers could deny religious accommodations if they imposed more than a de minimis cost. However, the Supreme Court’s decision in Groff v. DeJoy raises the bar, requiring employers to show that granting a religious accommodation would result in “substantial increased costs in relation to the conduct of its particular business.” This new standard places a heavier burden on employers, necessitating a demonstration of excessive or unjustifiable burden rather than minor inconveniences.

The Supreme Court emphasized that determining whether an accommodation presents an undue hardship requires considering all relevant factors in the specific case. Factors such as the nature, size, and operating cost of the employer must be taken into account. While the Court did not provide a bright-line rule, it urged employers and reviewing courts to evaluate the practical impact of accommodations on business operations.

Under the new standard, an employer cannot deny a religious accommodation solely based on inconvenience or displeasure expressed by coworkers. Employee animosity towards a particular religion or religious practice cannot be used as a basis for refusal unless it substantially interferes with business operations. This distinction prevents employers from relying on employee opposition to deny accommodations without demonstratable undue hardship.

EEOC Issues Updated Guidance as PWFA Becomes Effective

As the Pregnant Workers Fairness Act (PWFA) became effective at the end of last month, the EEOC has issued new guidance and resources to assist employers in complying with the changes. The PWFA increases the protections afforded to workers experiencing pregnancy, childbirth, or related medical conditions. Signed into law by President Joe Biden, the PWFA expands on existing protections against pregnancy discrimination under Title VII of the Civil Rights Act. The Equal Employment Opportunity Commission (EEOC), which is tasked with enforcement of the PWFA, has issued the guidance to aid employers in complying with the new law.

Key Provisions of the PWFA:

  • The PWFA requires covered employers with 15 or more employees to provide reasonable accommodations for workers experiencing limitations related to pregnancy, childbirth, or related medical conditions.
  • Employers must engage in an interactive process with the employee to determine suitable accommodations unless the accommodation would pose an undue hardship on the employer. Examples of reasonable accommodations include more frequent breaks, modified workstations, temporary transfers to less strenuous roles, and leave for recovery.
  • Employers cannot force employees to take leave if other reasonable accommodations can be provided to allow them to continue working.
  • In the event of non-compliance, employees and applicants have the right to bring civil actions against employers for PWFA violations. Remedies for violations may include back pay, reinstatement, and reasonable attorney’s fees.

EEOC’s Guidance for Employers:

To assist employers in understanding, implementing, and complying with the PWFA, the EEOC has released several tools and resources:

  • Infographic for Employers: The infographic outlines employer obligations under the PWFA, provides statistics about pregnant employees, and includes examples of potential accommodations. It serves as a reference guide for employers navigating the new requirements.
  • Poster Defining Legal Terms: The informational poster defines key legal terms, such as “reasonable accommodations” and “undue hardship,” as specified in the PWFA. It also offers additional examples of accommodations and highlights other federal laws that may apply to pregnant workers.
  • Infographic for Employees: The employee-focused infographic notifies covered employees of their rights to seek accommodations, provides a three-step plan for discussing accommodation needs with employers, and offers advice on what to do if an accommodation request is declined.

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