Akamai HR Solutions | December 2024 Special Update: Laws Taking Effect January 1, 2025

We’ve collected the most important new employment laws going into effect on January 1, 2025. In addition to the laws highlighted below, more than 55 states, cities, and counties will increase their minimum wage on January 1. We’ve included a chart with minimum wage updates following the employment law update. Need a customized, legally compliant employee handbook? Visit our Handbook page to build yours in just a few clicks.

 

HR & Legal Updates

 

Federal

• Exempt/Non-Exempt. A federal court recently struck down the U.S. Department of Labor’s rule that would have increased the salary threshold for white-collar exemptions to $58,656 and for highly compensated employees to $151,164 on January 1, 2025. This means the new thresholds won’t go into effect on January 1, and the thresholds that existed before the new rule ($35,568 for white-collar employees and $107,432 for highly compensated employees) are in effect. We’ll be watching for any appeal of this decision. 

• Financial Reporting. The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a new regulation in 2022 requiring companies to file a report on information about their beneficial ownership. Beneficial Owner Information (BOI) reporting is due on January 1, 2025, for companies created prior to January 1, 2024. That deadline has been extended by six months for certain companies impacted by hurricanes.

California

• Captive Audience. Employers will be prohibited from threatening or penalizing an employee who doesn’t attend a meeting or listen to communication from the employer about their views on political or religious matters.

• Child Labor. Beginning January 1, 2025, employers that have voluntarily submitted to a social compliance audit to determine if child labor is involved in their operations must post a link on their website to a report about their compliance with child labor laws.

• Crime Victim Leave. A new California law will expand the state’s paid sick leave law by (a) allowing leave if an employee’s family member is a crime victim, (b) extending the types of crimes covered, and (c) adding additional reasons for which employees can take leave if the employee or their family member is a crime victim. Unpaid protections for crime victims have largely remained the same, although they have been moved to a section of the law now enforced by California’s Department of Civil Rights. Employers who must provide crime victim leave (those with 25 or more employees) can now place limits on the amount of unpaid leave for crime victims and their families. The law also requires employers to notify employees of these rights at the time of hire, annually, and upon request. The state’s Civil Rights Department has not yet released this notice, which they will do by July 1, 2025. 

• Exempt/Non-Exempt. California’s salary threshold for exempt employees under state law will increase to $68,640 per year, $5,720 per month, or $1,320 per week.

• Job Postings. Employers will no longer be allowed to say in a job posting or application that a driver’s license is required for employment unless (a) the employer reasonably expects driving to be a job function and (b) the employer reasonably believes an alternative form of transportation wouldn’t be comparable in travel time or cost to the employer. 

• Paid Family and Medical Leave. Starting next year, employers can no longer require employees to use up to two weeks of vacation time before they start receiving paid family and medical leave insurance benefits through the state-run program. 
  • Also, employees’ wage replacement benefits will increase from between 60% and 70% to between 70% and 90%, with employee contribution rates increasing from 1.1% to 1.2%. 

• Sick Leave. California passed additional safe time uses for its statewide sick leave for agricultural employees who work outdoors. Agricultural employees will be allowed to use their sick time in case of smoke, heat, or flooding conditions caused by a local or state emergency. 

• Whistleblower Protection. Employers who post a newly-developed whistleblower poster will be deemed in compliance with the whistleblower statute’s notice requirements. The law doesn’t require employers to use the new poster, as long as they still post notice of employee rights, but the new poster is guaranteed to be compliant. As of the date of this publication, the Labor Commissioner has not published the new poster. 

Colorado

• COMPS Order. Colorado recently released the 2025 Colorado Overtime and Minimum Pay Standards (COMPS) Order, effective January 1. Employers should update their posters and handbook entries.
• Non-Compete Agreements. On January 1, 2025, the salary thresholds in Colorado will increase to $127,091 for non-compete agreements and $76,254.60 for non-solicit agreements.

Connecticut

• Pay Stubs. With each wage payment, employers will be required to include: (a) the number of paid sick leave hours that the employee has accrued or that the employer provided the employee, and (b) the number of paid sick leave hours the employee has used during the calendar year. Employers will need to keep these records for three years. 

• Sick Leave. Connecticut’s paid sick leave law is expanding. Currently, employers are subject to the law if they have 50 or more employees in the state. On January 1, 2025, that number will drop to 25 employees. It will reduce again to 11 employees in 2026, and once more to one employee in 2027. The new law also expands the type of employees who are eligible for leave. Currently, only service workers who are paid hourly or who are non-exempt under the FLSA are entitled to paid sick leave. Beginning January 1, 2025, employers will need to provide paid sick leave to all employees.

• Sick Leave Poster. Employers must put up a new Paid Sick Leave poster reflecting the requirements of the state’s updated sick leave law when it becomes effective. 

Delaware

• Paid Family and Medical Leave. Delaware’s Healthy Delaware Families Act creates a statewide paid family and medical leave insurance program. Employers will need to begin withholding contributions beginning January 1, 2025. Leave and benefits will be available to employees beginning January 1, 2026. The state has also published the notice (which includes a workplace poster) that employees can use to comply with the law’s notice and posting requirements. 

District of Columbia

• Non-Compete Agreements. We don’t know the exact number yet, but D.C. will increase the salary thresholds for non-compete agreements on January 1, 2025, based on the Consumer Price Index for All Urban Consumers in the Washington Metropolitan Statistical Area.

Illinois

• Captive Audience. Starting January 1, employers may no longer require employees to attend employer-sponsored meetings whose primary purpose is to communicate the employer’s opinion on religious or political matters. Employers also may not punish employees for refusing to attend those meetings.

• Child Labor. Illinois’ Child Labor Law of 2024 changes the hours minors can work, sets out new occupations in which minors are prohibited from working, imposes new notice and posting requirements, and sets new discrimination and retaliation prohibitions. 

• Employee Verification. A new Illinois law discourages Illinois employers from using E-Verify unless federal law requires the employer to use it. Employers also can’t use work authorization verification or reverification requirements greater than those that federal law requires. 

• Military Leave. Illinois law has expanded its definition of “armed forces” to include the United States Space Force. 

• Non-Compete. A new law clarifies the non-compete protections for construction workers. Previously, the law invalidated non-compete agreements with workers “covered by a collective bargaining agreement under the Illinois Public Labor Relations Act or the Illinois Educational Labor Relations Act and individuals employed in construction.” Beginning January 1, 2025, the new amendment clarifies that these protections don’t just apply to construction workers covered by a collective bargaining agreement, but all construction workers except those “who primarily perform management, engineering or architectural, design, or sales functions for the employer or who are shareholders, partners, or owners in any capacity of the employer.” 
  • Also, new non-competes with licensed mental health professionals will be unenforceable if those agreements would be “likely to result in an increase in cost or difficulty” to veterans or first responders who seek mental health services. 

• Pay Stubs. Each pay period, employers have to give employees a pay stub showing their hours worked, pay rate, overtime pay and overtime hours worked, gross wages earned, deductions, and total year-to-date wages and deductions. Employers can provide pay stubs electronically and must keep pay stub records for at least 3 years. 

• Pay Transparency. Employers with at least 15 employees need to begin including in their job postings the pay scale and benefits information for the position, starting January 1. The law applies to jobs performed at least partly in the state as well as jobs where the employee will report to a supervisor, office, or other work site in Illinois. 

• Protected Characteristics. Illinois added two new categories of protected characteristics to its anti-discrimination law, effective January 1. 
  • First, employers can’t discriminate against employees for actual or perceived decisions about reproductive health, meaning a person’s decisions regarding the use of contraception; fertility or sterilization care; assisted reproductive technologies; miscarriage management care; healthcare related to the continuation or termination of pregnancy; or prenatal, intranatal, or postnatal care.
  • Second, employers can’t discriminate against employees for their “family responsibilities,” which means an employee’s actual or perceived care of a family member in the past, present, or future. 
• Whistleblower Protections. Illinois updated its whistleblower protections this year. Effective January 1, 2025, employers may not retaliate against employees for disclosing or threatening to disclose information about a policy or practice that they believe, in good faith, violates the law or poses a real danger to employees or others.

Indiana

• Child Labor. Indiana revised its child labor laws to remove some labor protections for minors between 14 and 17 and remove restrictions that limit work hours for minors 16 and older. 

Kentucky

• Drug Testing. Medical marijuana will be legal in Kentucky starting next year, although the law doesn’t require employers to accommodate the use or presence of medical marijuana in the workplace. Employers will be free to have a drug testing policy, maintain a drug-free workplace, or have a zero-tolerance drug policy. 

Louisiana

• Non-Compete. Beginning January 1, 2025, non-competes with primary care physicians can only be used during the first 3 years of their employment relationship, and can’t be used at all after their employment ends. Post-employment non-competes are also prohibited for other types of physicians, but they can be used during the first 5 years of employment, rather than just 3. Additionally, non-competes can only be signed at the beginning of employment and can’t be entered after the employee has started work.

Maine

• Exempt/Non-Exempt. Maine’s salary threshold for exempt employees under state law will increase to $43,950 per year or $845.20 per week. 
• Non-Compete Agreements. Maine does not allow non-compete agreements with employees who earn less than 400% of the federal poverty level. That number is set to increase in January, though it hasn’t been released yet.

• Paid Family and Medical Leave. Contributions to Maine’s paid family and medical leave insurance program begin on January 1, 2025, although employees won’t be able to access paid benefits until May 1, 2026. 

Maryland

• Non-Compete Agreements. The salary threshold for non-compete agreements in Maryland will increase on January 1, to $24 per hour, or $49,920 per year.

Massachusetts

• Paid Family and Medical Leave. Employees’ maximum weekly benefit through the state’s paid family and medical leave insurance program will increase to $1,760.64. 

• Poster and Notice Requirements. The state has published its 2025 required paid family and medical leave poster, as well as the 2025 updated individual notice for employers with 25 or more Massachusetts employees and for employers with less than 25 Massachusetts employees. 

Minnesota

• Drug Testing. The state’s Drug and Alcohol Testing in the Workplace Act now allows “oral fluid testing” for drug, alcohol, and cannabis testing. All drug testing requirements currently imposed by law apply equally to any oral fluid testing the employer uses. 
• Employee Notice (St. Paul). Employers with 1 or more employees in St. Paul must provide new St. Paul employees with a notice at the time of hire of their rights under the city’s wage theft law upon hire and annually thereafter, starting January 1, 2025. This notice must contain all the information required by Minn. Stat. § 181.032(d), the employee’s start date, notice of the city’s minimum wage, a statement that sharing tips is voluntary, and any overtime policy applicable to the employee’s position. Employees must sign the notice and return it to the employer, who is then required to copy it, note the date it was received by the employee, and maintain the notice for 3 years after termination of that employee’s employment. Finally, employers will need to include a notice of employee rights under this wage theft ordinance in their employee handbook, if they have one.
• Wage Theft Poster (St. Paul). Effective January 1, St. Paul employers will need to begin posting the city’s wage theft flyer in a place where employees will see it.

• Pay Transparency. Employers with 30 or more employees in Minnesota must include the starting salary range and a general description of all of the benefits and other compensation an employee can expect in all job postings. 
• Pay Stubs (St. Paul). Beginning next year, employers must provide their St. Paul employees with pay stubs each pay period. The pay stubs may be provided electronically but must be provided physically if requested by the employee at least 24 hours in advance. The pay stubs must include all the same information required by Minnesota state law, plus any amount of an employee’s wages deducted by the employer.

Missouri

• Criminal History. Starting in January, a person with an expunged arrest can answer “no” if the employer asks whether the person has ever been arrested or charged with a crime, as long as there’s no public record of a crime after the expungement. 

New Hampshire

• Weapons in the Workplace. Beginning January 1, certain employers can’t ask employees whether they have firearms or ammunition in their vehicles, nor may they search vehicles for them. Employers that receive public funds of any kind can’t prohibit employees from keeping lawfully owned firearms or ammunition out of view in locked vehicles in an employer parking lot. 

New York

• Sick Leave. Employers must begin providing employees with an additional 20 hours of paid sick leave for prenatal care. This is leave taken for healthcare services for an employee during their pregnancy, including physical exams, medical procedures, monitoring and testing, and meeting with healthcare providers to talk about the pregnancy.

Oregon

• Employee Notice. Warehouse distribution center employers with 100 or more employees at a single warehouse distribution center or 1,000 or more employees at 1 or more warehouse distribution centers in Oregon must provide written notice to employees of any quota they have. The notice must include the quantified number of things to be done within a set time and a description of the consequences if an employee doesn’t meet the quota. This notice must be provided upon hire, within 2 business days of any change, and when an employer takes action against an employee for failing to meet the quota.
• Non-Compete Agreements. We don’t know the exact number yet, but Oregon will increase the salary thresholds for non-compete agreements on January 1, 2025, based on the Consumer Price Index for All Urban Consumers in the West Region.

• Paid Family and Medical Leave. Leave for going through the legal process to foster or adopt a child will now be covered under Oregon’s paid family and medical leave insurance program (“Paid Leave Oregon”) and is no longer an allowable reason for leave under Oregon’s unpaid family and medical leave law (“Oregon Family Leave Act”). 

Pennsylvania

• Non-Compete. Non-compete agreements will be unenforceable against medical doctors, doctors of osteopathy, certified registered nurse anesthetists, certified registered nurse practitioners, and physician assistants unless the agreement lasts no longer than 1 year and the worker was not terminated (meaning they’re only enforceable if the employee left voluntarily). The definition of a non-compete will also be updated. The current definition states that a non-compete agreement is one that is “designed to impede” the worker’s ability to practice. The new definition clarifies that a non-compete is any agreement that “has the effect of impeding” that ability, regardless of whether that was the agreement’s original intent.

Rhode Island

• Employee Notice. In the new year, employers with over 50 full-time employees will need to display a veterans benefits poster. The poster is not yet available.
• Non-Compete Agreements. Rhode Island does not allow non-compete agreements with employees who earn less than 250% of the federal poverty level. That number is set to increase in January, though it hasn’t been released yet.
• Temporary Caregiver Insurance. Employees will be allowed to take 7 weeks (up from 6) of leave under the state’s temporary caregiver insurance program. 

Virginia

• Non-Compete Agreements. Virginia doesn’t allow non-competes with employees who earn less than the average weekly wage. That number is set to increase in January, though it hasn’t been released yet.

Washington

• Exempt/Non-Exempt. Washington’s salary threshold for exempt employees under state law will increase to $69,305.60 per year for employers with 1-50 employees and to $77,968.80 per year for all other employers. 
• Non-Compete Agreements. Starting on January 1, 2025, the salary thresholds for non-competes in Washington will increase to $123,394.17 for employees and $308,485.43 for contractors.

• Overtime. Washington law already prohibits healthcare facilities from requiring certain employees to work overtime. Beginning January 1, 2025, the state is changing the definition of what employees are covered by that law. Employees covered by the new law are healthcare facility workers who are involved in direct patient care or clinical services and receive an hourly wage or are covered by a collective bargaining agreement. It will no longer be required that the employee also be a nurse or technologist, cardiovascular invasive specialist, respiratory care practitioner, or nursing assistant. 

• Sick Leave. Starting next year, employees can take leave after a declared emergency under the state’s paid sick leave law. The law’s definition of “family member” will also be updated to: (a) include a child’s spouse, (b) clarify that “spouse” includes a husband, wife, or state-registered domestic partner, and (c) include someone who regularly lives in the employee’s home or whose relationship creates an expectation that the employee will care for that person.

 

January 1, 2025 Minimum Wage Updates

Disclaimer: The information in this HR & Legal Update is provided for general educational purposes only and does not constitute legal advice. Akamai HR Solutions, LLC is not a law firm, and no attorney–client relationship is created by your use of this content. Laws may change or apply differently to your business. For legal guidance tailored to your specific circumstances, please consult a qualified attorney.