HR Updates: Major EEOC and FTC Rulings
The Equal Employment Opportunity Commission (EEOC), Department of Labor’s Fair Labor Standards Act (DOL-FLSA) and the Federal Trade Commission (FTC) have put forth some profound final rulings that require employers to swiftly adapt their current Human Resource strategies. Among the most salient rulings within the last few weeks are as follows:
EEOC – Pregnant Workers Fairness Act (PWFA) to include provisions for abortion care
The final ruling and regulations for implementing the PWFA cover lactation support in addition to accommodations for workers that seek an abortion. Naturally, given the politically contentious nature of the topic of abortion, this ruling has been met with both criticism and praise alike. At this time, seventeen state attorney generals (Arkansas, Alabama, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Missouri, Nebraska, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Utah and West Virginia) have sued the EEOC ruling accordingly. One interesting element is that a federal district court in Texas ruled that the law cannot be enforced in Texas due to Congress lacking the required quorum to pass the PFWA.
DOL-FLSA – Overtime and Salary Thresholds to increase
The FLSA’s final overtime rule has many employers scrambling to adjust their payroll strategies for salaried employees. In essence, this final ruling states that beginning July 1st, the salary threshold will increase to $43,888, meaning that employees making less than this threshold, such as hourly workers, can be eligible for overtime if they work enough hours. Beginning January 1st 2025, this threshold will increase further to $58,656. The current salary threshold for exempt salaried employees is $35,568 for reference. It is worth noting that these thresholds changes exclude certain executive, administration, and professional roles.
FTC: Noncompete Bans
The FTC has issues a new rule that effectively bans noncompete agreements under the vast majority of circumstances (senior executives are excluded). This leaves employers with a few options with regard to responsive strategies for this new ruling. One option would be to simply wait and see what occurs in the legal landscape as the legal challenges to this new rule inevitably playout. On the other hand, employees could begin to revisit their existing strategies and purposes behind their current noncompete agreements to determine alternative solutions to protecting their internal proprietary information and strategies. Regardless, it is highly recommended that organizations audit their existing agreements and determine the potential impact that this ruling could have on them.
Rauhul Chauhan
McCray Professor of Business and Associate professor of Management
