New Year, New Employment Laws - Preparing for Changes in 2024

Connecticut employers should be aware of key new federal and state employment laws that will be effective in 2024, and some other significant developments that are likely to occur. We summarize these new laws and developments below.?

Proposed Changes to Overtime Requirements

The federal Department of Labor (DOL) has proposed increasing the minimum salary level to be exempt from $684 per week ($35,568 annually) to $1,059 per week ($55,068 annually).?The DOL also proposed raising the annual compensation requirement for the highly compensated employee exemption from $107,432 to $143,988. The DOL intends to issue its final rule in April 2024. If enacted, the final rule could go into effect 60 days thereafter. There is a possibility that the DOL will modify its proposed rule, and/or that the final rule will be subject to legal challenge. Employers are well-advised to closely monitor developments and be prepared to make any necessary changes.

Non-Compete Agreements

Non-compete agreements have been under attack at the federal and state level. At the federal level, the Federal Trade Commission (FTC) proposed a new rule that would make it illegal for an employer to: (1) enter, or attempt to enter, into a noncompete with a worker; (2) maintain a noncompete with a worker; or (3) represent to a worker, under certain circumstances, that the worker is subject to a noncompete. Employers would also be required to rescind existing noncompete agreements and actively inform workers that they are no longer in effect. The FTC is expected to vote on the rule in April 2024.

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The General Counsel of the National Labor Relations Board (NLRB)?issued a memorandum?in March 2023 stating that many non-compete and non-solicitation restrictions violate employees’ protected rights under Section 7 of the National Labor Relations Act. States have also taken aim at non-compete agreements. For example, the New York legislature passed legislation that banned non-compete agreements; however, it was vetoed by the Governor. Legislation also has been proposed in Connecticut on numerous occasions that would severely limit the enforceability of non-compete agreements. Such legislation is likely to resurface during the next legislative session.

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Workplace Discrimination Claims

The United States Supreme Court will issue a decision in Muldrow v. City of St. Louis that will have a significant impact on workplace discrimination claims. The Court will decide whether Title VII requires a plaintiff to show a materially adverse employment action to state a discrimination claim. If, as many suspect, the Court does not require a plaintiff to meet this threshold, this could result in significantly more discrimination claims, including reverse discrimination claims arising from DEI initiatives.??

Connecticut Minimum Wage Increases

Connecticut’s minimum wage increased from $15.00 per hour to $15.69 on January 1st, 2024. This increase is based on the percentage change in the federal employment cost index. Future annual increases on January 1st will also be based on the U.S. DOL’s calculation of the employment cost index for the 12-month period ending on June 30th of the preceding year.?

Unemployment Compensation

There are several major changes to Connecticut’s unemployment compensation program that are effective January 1st, 2024. For example, the taxable wage base that is a component of an employer’s unemployment taxes will increase from the first $15,000 per employee to the first $25,000. In addition, the minimum unemployment tax rate will decrease from .5% to 0.1% while the maximum rate will increase from 5.4% to 10%. And, in all cases, a claimant’s receipt of severance pay will now result in disqualification from receiving unemployment compensation benefits for the period of time covered by the payment.?

Sick Leave

Employers should be mindful that as of October 1st, 2023, Connecticut’s sick leave law was expanded to allow the use of sick leave for a “mental health wellness day,”?i.e., a day during which the individual attends to their emotional and psychological well-being instead of working their regularly scheduled shift.

Our Labor & Employment team will continue to monitor this development and is available to answer your questions.

For further information, please contact:

Nick Zaino

Partner

203.578.4270

[email protected]

This information is for educational purposes only to provide general information and a general understanding of the law. It does not constitute legal advice and does not establish any attorney-client relationship.