Hartford, Connecticut – Employers in Connecticut should be aware of new federal and state employment laws set to take effect in 2024, as well as other significant developments on the horizon. These changes will have implications for various aspects of the workplace, including overtime requirements, noncompete agreements, workplace discrimination claims, minimum wage increases, unemployment compensation, and sick leave policies.
The federal Department of Labor (DOL) has proposed raising the minimum salary level for overtime exemption from $684 per week ($35,568 annually) to $1,059 per week ($55,068 annually). Additionally, the DOL aims to increase the annual compensation requirement for the highly compensated employee exemption from $107,432 to $143,988. The final rule is expected to be issued in April 2024 and could go into effect 60 days thereafter. It is worth noting that the proposed rule could be modified, and the final rule may face legal challenges.
Noncompete agreements are facing scrutiny at both the federal and state levels. The Federal Trade Commission (FTC) is considering a new rule that would prohibit employers from entering or maintaining noncompete agreements with workers, under certain circumstances. The FTC also plans to require employers to rescind existing noncompete agreements and inform workers of their nullification. The vote on this rule is expected to take place in April 2024. Additionally, the General Counsel of the National Labor Relations Board released a memorandum stating that many noncompete and non-solicitation restrictions violate employees’ protected rights.
States have also taken action against noncompete agreements. For example, the New York legislature passed a bill banning such agreements, although it was subsequently vetoed by the governor. In Connecticut, legislation has been proposed to limit the enforceability of noncompete agreements, and it is likely to resurface during the next legislative session.
The U.S. Supreme Court is set to issue a decision in the Muldrow v. City of St. Louis case, which will have significant implications for workplace discrimination claims. The court will determine whether a plaintiff needs to show a materially adverse employment action to establish a discrimination claim under Title VII. If the court does not require this threshold, it could result in more discrimination claims, including reverse discrimination claims related to diversity, equity, and inclusion initiatives.
Connecticut’s minimum wage increased from $15.00 per hour to $15.69 on January 1, 2024. Future annual increases will be based on the U.S. DOL’s calculation of the employment cost index for the 12-month period ending on June 30 of the preceding year.
There are several major changes to Connecticut’s unemployment compensation program that went into effect on January 1, 2024. The taxable wage base, which influences an employer’s unemployment taxes, increased from the first $15,000 per employee to the first $25,000. Additionally, the minimum unemployment tax rate decreased from 0.5% to 0.1%, while the maximum rate increased from 5.4% to 10%. Moreover, individuals who receive severance pay will now be disqualified from receiving unemployment compensation benefits for the corresponding period covered by the payment.
Lastly, employers should be aware that Connecticut’s sick leave law was expanded to allow the use of sick leave for “mental health wellness days” starting October 1, 2023. This expansion enables individuals to prioritize their emotional and psychological well-being by taking time off work.
These new laws and developments indicate the evolving landscape of employment regulations in Connecticut. Employers are encouraged to closely monitor these changes and make necessary adjustments to ensure compliance.