Many new employment laws in 2023 have been introduced to reshape the regulations that oversee the safety of US citizens, and companies that want to avoid any complications in the future should ensure they update their regulations and policies to match them as well. The US employment regulations this year have not introduced too many major changes that necessitate significant restructuring but the rules are impactful nonetheless. Employees also need to be aware of the many regulations, such as the pay equity legislation, in order to understand what the government can do to protect their interests if there are ever any violations that disregard their rights and interests in favor of the company’s own profit and well-being.
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New Employment Laws in 2023
A major responsibility for every company, regardless of its size or industry, is keeping up with the US employment regulations that have been introduced this year. Employers need to regularly update their internal policies to suit the climate and interest of their workforce and the legal regulations are a good place to get started.
Employment Law Non-compete Clause
Earlier this year, the Federal Trade Commission proposed an employment law regarding the non-compete clause, proposing to ban its use across the country. The FTC believes that these non-compete agreements represent unfair methods of competition and should not be used to regulate employees once they leave the organization. According to the upcoming employment law, non-compete clauses will no longer be upheld by the courts in case employers do attempt to enter and enforce such restrictions on their employees. The rule would potentially apply to contractors and employees, ensuring that all workers are guaranteed freedom of employment after leaving an organization. This rule will ensure that existing non-compete clauses will no longer be considered valid as well.
Squire Patton Boggs states that at least two National Labor Relation Board regional offices have issued complaints challenging traditional non-competition and non-solicitation agreements between employers and employees. Many US states already have restrictions on non-compete clauses and if this new federal employment law from 2023 is finally upheld, it will enforce a ban on such agreements throughout the US. According to Bloomberg Law, the FTC will vote on the rule in April 2024.
Pay Transparency Legislation
Another one of the US employment regulations under consideration is the pay transparency legislation that requires employers and recruiters to be upfront about the pay scale that job applicants can hope to see for the roles they are interested in. At both the state and federal levels, laws are being passed to ensure that salaries fairly compensate individuals for the work that they do and pay all their workers equally without discrimination. Employers are not allowed to ask employees about the pay at their previous job as they might be prone to underpaying an employee on the basis of a previous job that was also underpaying them.
Instead, the new US employment regulations are attempting to guide employers towards being honest about the budget they have available for a role and matching up pay to what the industry standard for the role is. Currently, different states have different rules regarding pay transparency legislation, both in terms of what details must be shared and who it applies to. In California, the salaries must be disclosed in any job posting and apply to any organization with at least one employee in the state. In Connecticut, the salary scale should be disclosed before an offer is made to the applicant, if the applicant requests the information, or if a current employee requests the information, but there are no rules for including it in the job posting. Federal pay transparency legislation would help create a more standardized form of these laws, but until then, employers need to be aware of the laws in their state and from states where their employees work out of as well.
Pregnant Workers Fairness Act: New Employment Laws in 2023
Unlike the previous two mentioned, the Pregnant Workers Fairness Act 2023 has been legally established across the country already and requires that employers consider reasonable accommodations when it comes to pregnant workers and the limitations faced by them. Enforced by the Equal Employment Opportunity Commission the US employment regulation went into effect on 27 June 2023 and provides additional protections on top of those that are already guaranteed through the Pregnancy Discrimination Act.
The Pregnant Workers Fairness Act does not replace any existing laws that provide greater protection for workers affected by pregnancy, childbirth, or related medical conditions, but only requires employers to consider any reasonable accommodations they can make to assist workers without facing “undue hardship” themselves. Examples of reasonable accommodations include flexible hours, additional breaks for food and rest, the ability to sit and have access to water, permission to opt out of strenuous activities, etc. The new employment laws in 2023 are simple but essential ones that employers need to consider while planning their policies.
Right to Religious Accommodation
While not a new entrant to the US employment regulations, the Supreme Court clarified the right to religious accommodations under Title VII of the Civil Rights Act, stating that employers are required to provide reasonable accommodations for employee’s religious beliefs or practices that do not cause undue hardship to the employer. In order to claim undue hardship, employers will have to prove that they would encounter substantially increased costs in the operation of their business if the requested accommodation is made.
In terms of the hardship affecting coworkers, it would only be relevant to the extent that it affects the actual conduct of the business and not because the coworkers feel animosity towards the particular religion. This law protects the religious interests of workers without seriously impeding the business of any organization, so employers need to reassess what will be done when an employee puts in a request for such reasonable accommodations.
Update to Employee Severance Agreements by the National Labor Relations Board (NLRB)
The NLRB ruled that certain confidentiality and non-disparagement provisions that were mentioned in severance agreements were a violation of an employee’s rights under the National Labor Relations Act. The board stated that such agreements were unlawful as they prevented exiting employees from sharing information regarding the employer’s conduct with other employees or government agencies, preventing them from raising a complaint against the ex-employer. According to White and Case, “The NLRB noted that employees have the right to critique employer policy by publicizing labor disputes subject only to not being disloyal, reckless or maliciously untrue.”
Employers need to be more careful with the contracts they set for employees and the types of agreements that are included. Employees will still be prevented from sharing proprietary information with outsiders so employers can be reassured that sensitive data will remain safe, but anything that interferes with the employee’s rights can be disputed.
The state-based pay transparency legislation and federal employment laws regarding non-compete clauses are examples of rules that government bodies are aiming to enforce to protect workers across the country. Employers need to be more considerate of their employees and ensure their policies and practices reflect these legislations effectively.