BOP NEWSLETTER • December 2024
New Department of Labor Salary Threshold Requirement for Exemptions Has Been Struck Down by Texas Federal Judge
On November 15, 2024, U.S. District Judge Sean Jordan for the Eastern District of Texas granted summary judgment in Texas v. Department of Labor to the state of Texas and a group of more than a dozen business organizations, striking down the U.S. Department of Labor’s (DOL) April 2024 rule to raise the minimum salary for the Fair Labor Standards Act’s executive, administrative, and professional employee overtime exemption.
The DOL’s April 2024 overtime rule had made three key changes: (1) it had raised the minimum weekly salary to qualify for the exemption to $844 per week or the equivalent salary of $43,888 per year, on July 1, 2024; (2) the rule would have further increased that threshold to $1,128 per week, the equivalent of a $58,656 annual salary on January 1, 2025; and (3) it would have adjusted the salary thresholds every three years based on up-to-date wage data.
The Texas ruling vacates the DOL’s rule in its entirety nationwide, including the increase that went into effect on July 1, 2024. As a result, the salary threshold exempt status reverts back to the DOL’s 2019 rule, which set the exemption at $684 per week, or $35,568 annually. However, the DOL did appeal the decision to the Fifth Circuit, though that could be impacted by the incoming DOL under the new Trump administration.
Several New Changes Coming to California January 1, 2025
“Captive Audience” Meetings Banned: “Captive audience” meetings are employer-sponsored mandatory meetings that discuss religious or political matters, including union-representation discussions. Senate Bill 399, referred to as the “California Worker Freedom from Employer Intimidation Act,” will subject most employers to a civil penalty or civil action starting the first of the year, if they require employee attendance at such meetings under threat of discharge, discipline, or some other adverse employment action.
Driver’s License Requirements in Job Postings Restricted: Senate Bill 1100 makes it an unlawful employment practice to include statements that an applicant must have a driver’s license in job advertisements, postings, applications, and similar employment material unless the following conditions are satisfied:
- The employer reasonably expects driving to be one of the job functions of the position.
- The employer reasonably believes that using an alternative form of transportation would not be comparable in travel time or cost to the employer.
Managing Employee Leave under Paid Family Leave: Assembly Bill 2123 eliminates an employer’s ability to require employees to use accrued vacation leave before accessing California’s Paid Family Leave Program (PFL). Previously, employers could require employees to take up to 2 weeks of accrued vacation before employees could access PFL benefits.
Protection for Combinations of Protected Characteristics: Senate Bill 1137 clarifies that the California Fair Employment and Housing Act prohibits discrimination on the basis not just of individual protected traits, but also on the basis of the intersectionality (e.g., combination) of two or more protected traits.
The California Legislature described the concept of intersectionality as follows:
- Intersectionality is an analytical framework that sets forth that different forms of inequality operate together, exacerbate each other, and can result in amplified forms of prejudice and harm. The framework and term “intersectionality,” coined and popularized by legal scholar Professor Kimberlé Williams Crenshaw, captures the unique, interlocking forms of discrimination and harassment experienced by individuals in the workplace and throughout society . . .
Through Senate Bill 1137, California’s Legislature affirms the decision of Lam v. University of Hawai’i (9th Cir. 1994) 40 F.3d 1551, where the Ninth Circuit found that when an individual claims multiple bases for discrimination or harassment, it may be necessary to establish whether the discrimination or harassment occurred on the basis of a combination of these factors, not just one protected characteristic alone.
Alaska, Missouri, and Nebraska Voted “Yes” to Paid Sick Leave Mandates
Bent Ericksen & Associates’ clients can expect more information to come in 2025, particularly a compliant sick leave policy for each state.
Alaska: As a result of passing Ballot Measure 1, effective July 1, 2025, the new Alaska sick leave law will require the accrual of 1 hour of sick leave for every 30 hours worked. Employers with fewer than 15 employees can cap annual accrual and usage at 40 hours per year, while employers with 15 or more employees may cap annual accrual and usage at 56 hours. All unused sick leave must carry over from year to year — with no cap on the amount that carries over. Sick leave can be used for a multitude of reasons and family members.
Missouri: Voters passed Proposition A, which will take effect on May 1, 2025. Similar to Alaska, Missouri employees will accrue 1 hour of paid sick leave for every 30 hours worked. While an annual accrual cap is not contained within the law, yearly usage of sick leave can be capped at 40 hours for employers with fewer than 15 employees and 56 hours for those with over 15 employees. Up to 80 hours of unused sick leave can carry over at the end of the year. Sick leave can be used for a multitude of reasons and family members.
Nebraska: Becoming law after Nebraska voters passed Ballot Initiative 436, the new sick leave requirement is set to take effect October 1, 2025. Nebraska’s law also shares some similarities with the Alaska and Missouri laws. Employees will accrue sick leave at a rate of 1 hour of sick leave for every 30 hours worked. An employer with 19 or fewer employees may limit accrual and use to 40 hours per year, while employers with 20 or more employees may limit accrual and use to 56 hours per year. All accrued paid sick time is carried over from year to year. Sick leave can be used for a multitude of reasons and family members.
Pay Transparency Requirements Coming Soon to New Jersey
Beginning June 2025, Senate Bill 2310, signed earlier this year by the NJ governor, will require most employers operating in the state to include pay and benefits information in job postings.
The new law will apply to any employer with 10 or more employees that does business, employs workers, or takes job applications within New Jersey. Covered employers must include a pay range and general description of benefits and other compensation in any external or internal job posting.
In addition, before making a promotion decision, employers must make reasonable efforts to inform current employees in the affected department of the opening. The law defines a promotion as a change in job title and an increase in compensation.
Promotions based on years of experience or job performance are not subject to the notification requirement, and employers may still make promotion decisions on an emergent basis due to unforeseen events.
A first violation of the law carries a civil penalty of $300, and each subsequent violation will be subject to a $600 penalty.