2024 will be a big year for workplace legislation.
Last year, there was notable legislation enacted around artificial intelligence in New York City and more states hopped on the regulatory bandwagon to pass salary transparency laws, as examples. But 2024 is set to hold even more legislative updates that will have a direct impact on the way we work. And employers will need to ensure they’re on top of the changes, to stay compliant.
“It’s crucial that employers are not only aware of the upcoming legislative changes, but they take effective preparative action as soon as possible,” said Antonio Fletcher, head of employment at the law firm Whitehead Monckton. “Company policies and procedures must be updated in advance to reflect these statutory changes, ideally with the assistance of professional HR consultants or by obtaining legal advice to make sure all changes are fully compliant.”
We created a roundup of what’s on the horizon this year and talked to experts to better understand why these laws matter for work life.
Increased minimum wage
Kicking the year off with a bang, almost 10 million workers in 22 states got raises on Jan. 1. A report from the Economic Policy Institute estimated that in total, workers will receive $6.95 billion in additional wages from state minimum wage increases. In addition, 38 cities and counties will increase their minimum wages on Jan. 1 above their state’s wage floors, adding to the number of workers likely to see increased earnings.
“The economy is also helping take care of that on its own,” said Paul Glover, a former federal trial lawyer for over 20 years, specializing in employee law. “So as long as the labor market remains tight, the economy will force wage increases. This legislation passed, but if the marketplace says you’re only going to hire people if you pay them even more, then you have to do that.”
Why it matters: According to EPI’s analysis, the minimum wage continues to be a vital policy for creating a more equitable economy. Women make up more than half (57.9%) of workers who got an increase on Jan. 1. Black workers make up 9.0% of the wage-earning workforce in the states with increases, but are 11.1% of the affected workers. Similarly, Hispanic workers are 19.6% of the workforce in these states, but 37.9% of the workers who received wage increases. More than a quarter (25.8%) of affected workers are parents, or more than 2.5 million people.
Several states, including California, Oklahoma and North Dakota, have already taken steps to prohibit or significantly restrict the use of noncompete agreements. But the issue drew more attention when the Federal Trade Commission proposed a new rule that would effectively ban companies from using noncompete clauses in employment contracts. In May, NLRB general counsel Jennifer Abruzzo also argued in a memo that enforcing noncompete clauses in employment contracts and severance agreements violated the National Labor Relations Act in most instances. Due to an overwhelming response during the public comment period, the FTC has pushed its final vote to April 2024.
States like Minnesota and California have continued to enact laws this year that take aim at noncompete agreements. The state of New York has also passed legislation that would ban noncompete clauses, but the governor has yet to sign it.
Why it matters: A non-compete agreement is a clause in an employment contract that prevents employees from working for competitors after leaving a company. It ultimately can restrict employees through time, industry or even geography. These agreements are commonplace in industries like finance and media. It protects companies’ confidential information but leads to the individual having less job mobility and lower wages for workers.
“Some of these non-compete clauses have been too broad,” said Emily M. Dickens, chief of staff and head of public affairs at Society for Human Resource Management. “There is a need for them, but some of them tie in people who are not making lots of money and would be restricted in finding their next opportunities. There’s no need to include everyone and make them sign it.”
Paid family and sick leave
Workers in Colorado will have access to paid family leave in 2024, more than three years after residents voted in a ballot measure securing the benefit. In Minnesota, the state passed family leave which will go into effect in 2026. But starting Jan. 1, workers will have access to paid sick leave. Illinois also enacted a law that grants most workers in the state one week of paid leave to be used for any purpose, which will go into effect in 2024. Specifically, in Chicago, the Blood and Organ Donation Leave Act went into effect in the new year, which allows workers to take time off to give blood or donate an organ.
While unpaid, Illinois also now entitles employees to an additional amount of job-protected leave when they lose a job because of homicide or suicide. The amount of additional leave depends on the size of the employer. Illinois also increased the amount of unpaid leave for employees whose family or household member was killed in a violent crime.
In California, a new law that went into effect Jan. 1 increases the number of job-protected paid leave hours employees can receive and use each year. Also in California, a new law provides a leave of absence for a reproductive loss event, including the final day of a failed adoption, failed surrogacy, miscarriage, stillbirth or unsuccessful assisted reproduction.
Why it matters: Businesses benefit when their employees have access to paid sick days. It provides better financial security and stability for the employee while also offering retention benefits to the employer.
Pay history and salary transparency
While there has been an increase in salary transparency laws that require employers to list salary bands in job descriptions, there is other salary-related legislation happening too. Effective Mar. 1, 2024, in Columbus, Ohio, an ordinance will prohibit employers with 15 or more employees from asking about or screening job applicants based on their current or prior wages, benefits, other compensation or salary histories.
The city joins a growing number of municipalities banning inquiries about wage or salary history, including places like New York, Pennsylvania, Rhode Island, South Carolina, Philadelphia and Salt Lake City.
Why it matters: Salary history bans can help eliminate pay discrimination. A job applicant’s previous salary may not reflect their current qualifications or capacity to perform work. For example, an applicant’s salary may not reflect their qualifications if they have experienced pay discrimination or have needed to work fewer hours to accommodate caregiving responsibilities.
“People feel like it’s a barrier to getting an equitable salary,” said Dickens. “For example, if you work for a small non-profit there is a much smaller pay range. Even if you’re at the top, and you leave there and work for a large for-profit organization, with a higher pay range, and you tell them your previous salary, it is easier for them to pay you less.”
While that person might be getting paid $20,000 more than at their previous job, they might not be making anywhere near the salary of someone else who has worked in large for-profits their entire career.
On the note of pay equity, Hawaii has three big changes to its efforts that went into effect Jan. 1. Equal pay will be required across all protected categories covered by Hawaii’s employment discrimination statute, not just between the sexes. That includes race, sex, sexual orientation, age, religion, ancestry, disability, and more. Additionally, instead of requiring that employees or groups of employees be the same if they do “equal” work, the standard for equal pay will now be “substantially similar work.” That opens the door to more comparisons across departments or job types. And in another push for pay transparency, Hawaii will require employers with 50 or more employees to include the hourly rate or salary range in job postings.
“The salary and compensation discussion is the responsibility of both parties,” said Dickens, who encourages candidates to do their market research as well.