IRS – Benefit Plan Limits Increase in 2024: The IRS just announced increases in annual limits and phase-outs of deductions for retirement and other benefit plans for 2024. Some of the highlights include: increasing 401(k) limits from $22,500 to $23,000, increasing HSA maximums from $3,850 to $4,150 for individuals and from $7,750 to $8,300 for families, and increasing Health FSA limits from $3,050 to $3,200. In addition, the Social Security taxable wage base will increase from $160,000 to $168,600.
Artificial Intelligence: The Biden administration recently released an “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence.” The Order covers multiple concerns around the growing influence and use of AI, such as the protection of infrastructure from cyberattacks, the use of AI by public agencies, and employment-related issues. For employment, the Order directs federal agencies to review the effect AI may have on the labor market, consider how to address workforce disruptions through education and re-training and assess potential regulations of employers to minimize adverse effects on workers. The DOL is directed to “develop guidelines” for employers, including steps they should take with regard to “labor standards and job quality” that cover equity, NLRB-protected activity, compensation, health, and safety, and electronic monitoring. When combined with the NLRB’s increased interest in employee monitoring and EEOC’s interest in potential discrimination embedded in algorithms, most experts expect the use of AI in the employment context to come under increasing scrutiny and regulation by federal agencies and state laws. Employers should be tracking and evaluating the use of AI in their employment decisions, exercising caution when using electronic monitoring to assess productivity or make employment-related decisions, and reviewing state and local laws to comply with any notice and consent requirements.
SCOTUS/Employee Transfers: The Supreme Court is expected to hear oral arguments in December on whether the forced lateral transfer of an employee with no loss of pay or status can be considered Title VII discrimination. Circuit Courts are split on this issue. In this case, a female member of the St. Louis police department was forced to transfer to a different division due to new leadership. She claimed that the new role focused on more administrative tasks and lacked several benefits of her prior role, such as not working weekends, not wearing a uniform, and working a consistent schedule. Her salary remained the same. Both lower courts ruled in favor of the police department, finding that a discrimination claim required an adverse employment action that led to a materially significant disadvantage, and because her pay and rank remained the same, she was still in a supervisory role, and her duties were similar, there was no proof of harm or adverse employment action. The Supreme Court’s decision is expected to provide some clarification regarding what types of employment actions can support a discrimination claim.
Minimum Wage Reminder: January 1 is a common date for states and local jurisdictions to increase minimum wage requirements. Those increases often also translate into higher salary basis requirements for exempt employees. This is a good time to review those changes and budget for increases in 2024.
Chicago Paid Leave (eff 12/31/2024) – The City of Chicago has effectively doubled the amount of paid leave an employer must provide to employees working in Chicago. The new Chicago Paid Leave and Paid Sick and Safe Leave Ordinance passed on November 9, leaving employers with very little time to implement the new requirements. It covers all employers and any employee who performs at least two hours of work in a two-week period in Chicago (including employees who work from home in Chicago). The ordinance replaces the current sick leave ordinance, and creates two buckets of leave:
- Five days of “Paid Leave” for any reason, and
- Five days of “Paid Sick Leave” for when the employee, or their family member, is sick, injured, or receiving professional care, or for several other circumstances as defined by the ordinance.
Both types of leave accrue at a rate of one hour per 35 worked (capped at 40 hours), or 40 hours can be frontloaded. For accrued leave, employees can carry over 16 hours of Paid Leave and 80 hours of Paid Sick Leave. After termination of employment, an employee may be entitled to a payout of unused Paid Leave, but not Paid Sick Leave. For Paid Leave, small employers (less than 50 employees) are not required to pay unused Paid Leave. Medium employers (51-100) have a two-year phase-in and must pay out up to 16 hours of unused paid time off until December 31, 2024, and all unused paid time off (maximum of 7 days or 56 hours) starting January 1, 2025. Large employers (100+) are required to pay out any unused Paid Leave starting December 31, 2023. Chicago employers should review their existing sick leave, vacation, and PTO policies to ensure compliance with the many requirements of this new ordinance.
Electronic Distribution of Notices (eff 1/1/24) – Employers with workers “who do not report to the office regularly” will be required to distribute some notices via email or by conspicuously posting them on their website or internal intranet site. Employers should consider delivering all notices electronically to comply with general state and federal notice requirements, but the current covered Illinois notices include:
- The Illinois Minimum Wage notice
- The Illinois Equal Pay Act
- The Illinois Wage Payment and Collection Act
- The Illinois Child Labor Law
Extended Child Bereavement Leave for Large Employers (eff 1/1/24) – Illinois employers with 50+ employees will be required to provide 6 weeks of unpaid, job-protected leave to employees who lose a child to homicide or suicide (12 weeks for 250+ employers). Employees must have worked for the employer for at least two weeks and must take the leave within one year. Leave can be taken intermittently in increments of no less than four hours. Documentation may be required.
Pre-tax Commuter Benefits (eff 1/1/24) – Employers in 38 Illinois counties and townships must allow employees to use pre-tax dollars for the purchase of a transit pass, up to $315/month, or participate in a program offered by the Chicago Transit Authority or the Regional Transit Authority.
Expanded Leave for Family Members Death by Crimes of Violence (eff 1/1/24) – Amendments to the Illinois Victims’ Economic Security and Safety Act (VESSA) expand leave available to Illinois employees grieving a family member’s death arising from a crime of violence. The amount of leave available is technically detailed, and will often overlap or be extended under existing VESSA requirements or the Family Bereavement Act. New reasons for leave under VESSA include (1) to attend the funeral or alternative to the funeral or wake of a family or household member who is killed in a crime of violence; (2) to make arrangements necessitated by the death of a family or household member who is killed in a crime of violence; or (3) to grieve the death of a family or household member who is killed in a crime of violence. For this type of leave, employees may take up to 2 weeks within 60 days of the notice of death. Employees may also be entitled to additional VESSA leave when they or a family member is a victim of domestic violence or crimes of violence to obtain services from a victim services organization, obtain legal assistance, and participate in safety planning. This type of leave is 4 weeks for fewer than 15 employees, 8 weeks for 15+ employers, and 12 weeks for 50+ employers.
Pay Transparency – Although it will not go into effect until January 1, 2025, pay transparency is coming to Illinois. It will require 15+ employers to include a good faith wage or salary range and a general description of benefits and other compensation and will require employers to announce promotional opportunities to current employees within 14 calendar days after an external posting. It also covers remote employees who report to a supervisor, office, or other work site in Illinois.
Genetic Information (GIPA) – Although the Illinois Genetic Information Privacy Act has been in place since 1998 plaintiffs attorneys have been especially focused on it this year, filing more than 50 class action lawsuits. More are expected. GIPA prohibits employers from requesting, requiring, or purchasing genetic testing as a condition of employment, or using this type of information as a basis for an adverse employment action. It also prohibits insurers form using this information for underwriting purposes. The lawsuits focus primary on allegedly illegal pre-employment physicals that request a family history, and insurance requirements (such as life insurance) that require a physical or ask questions about family medical history.
Evanston Fair Workweek – Employers that “exercise control” over 100+ employees and that are primarily engaged in a covered industry (hospitality, retail, warehouse, manufacturing, food service, etc.) must provide schedules in writing at least 14 calendars days in advance and follow additional requirement for new employees or schedule changes. Upon written request, they must provide the schedule electronically.
The Minnesota Department of Labor and Industry released the new Earned Sick and Safe Time sample notice to employees on its website (in multiple languages). Employers are not required to use the sample notice, but any alternative must include all the information provided in the notice, must be provided in the primary language of the employee, and be provided by January 1, 2024. The notice requires substantial customization, so employers should review and complete it well before the new year. Notices may be provided by (1) posting a copy of the notice at each location where employees perform work; (2) providing a paper or electronic copy of the notice to employees; or (3) conspicuously posting in a web-based or app-based platform through which an employee performs work. Employers that select option (1) above must make sure the notice is readily observed and easily reviewed by all employees performing work. Employers must also include an ESST notice in their handbook if they have one. The Bloomington, Minneapolis, and St. Paul local paid sick time ordinances are in addition to the state requirements and also require notice in employee handbooks. Bloomington recently amended its ordinance to align more closely with state requirements, effective January 1, 2024.
NY employers are currently required to provide a Record of Employment form to employees who quit, are laid off, or are discharged. The legislature expanded that requirement this year to require the notice upon a “reduction in hours”, “temporary separation”, or “and other interruption in employment that results in total or partial unemployment”. The NYDOL issued an updated form to include this requirement on its website, so employers should replace their existing form.
Legalized Marijuana (eff 12/7/23): Ohio recently became the 24th state to legalize recreational marijuana. The voter initiative passed with a 57% approval rate and is expected to be modified in some respects in the next legislative session. Under this new law, as it is currently written, employers still have the ability to:
- Prohibit or refuse to accommodate an employee’s use, possession, or distribution of adult-use cannabis.
- Refuse to hire, discharge, discipline, or otherwise take adverse employment action against an individual based on their use, possession, or distribution of cannabis.
- Establish and enforce drug testing policies, drug-free workplace policies, or zero-tolerance drug policies. These policies may prohibit the use of cannabis, including during work hours or while under the influence of cannabis.
- Subject employees to disciplinary action, up to and including termination of employment, who violate workplace policies.
There is currently no private right of action under the new statute, including for actions by the employer based on lawful, off-duty use.
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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.