The only resolutions HR and compliance heroes care about are those inked in the lawbooks.
HR pros are ringing in the new year in style…by updating internal policies and ensuring their organizations are compliant with new laws and regulations or big changes to old ones.
“It’s really a great time to be thinking about bigger questions, like what those new compliance requirements mean for your organization and how can you use those to your advantage?” said Helena Almeida, VP and managing counsel at ADP, who oversees its HR and benefits team.
Wage and leave. Nearly half of US states and dozens of local jurisdictions will increase their minimum wage on Jan. 1. Employers in more than a half dozen states will also see changes to sick leave laws. New York employers must offer 20 hours of paid prenatal leave to employees.
“There’s a lot of activity that’s going to happen at the state level when it comes to minimum wage, but also when it comes to things like worker classification, independent contractor status, and maybe some independent contractor rights that are going to require employers to really stay diligent,” Almeida said.
In November 2024, a DOL rule that would have increased the minimum salary threshold for exempt employees to qualify for overtime pay was blocked in the courts, suggesting the previous threshold, set in 2019, is likely to go back into effect.
Pay transparency and reporting. Employers in Illinois, Massachusetts, Minnesota, New Jersey, and Vermont will soon be required to comply with new pay transparency laws, HR Brew recently reported.
“Illinois has passed a job transparency bill that goes into effect January 1. Within that bill, they now require that employers with 15 or more employees include a pay scale as well as benefits for position in any job posting, and they have a series of requirements…in addition to the regular pay scale like wage or salary,” said Jocelyn King, founder and CEO of VirgilHR, a compliance software startup that helps HR pros stay compliant.
The activity will continue in 2025.
“It’s progressively becoming more and more common, and I think it’s also something that’s continuing to be refined by states…to make them a bit more holistic and higher scope, like including benefits in job descriptions, for example,” she said.
Almeida told HR Brew the expected activity in the new year will be focused on state legislatures rather than Washington D.C., adding that absent efforts at the federal level, some states may look to include pay reporting requirements in their transparency laws.
Quick-to-read HR news & insights
From recruiting and retention to company culture and the latest in HR tech, HR Brew delivers up-to-date industry news and tips to help HR pros stay nimble in today’s fast-changing business environment.
“You really need to start looking at your pay strategy and looking at your data so that you can communicate effectively what that strategy is,” she said.
AI. New York City spearheaded its Local Law 144 of 2021 that regulates the use of “automated employment decision tools.” The EU passed sweeping AI regulations this summer. Colorado became the first state to regulate AI technology to protect against “algorithmic discrimination.” Almeida predicts others to explore protections in 2025.
“We’re getting into the meat of the AI legislation-regulatory revolution, both in the United States and abroad,” Almeida said. “Legislators are really trying to grapple with how to deal with this technology and how to make sure it’s used in a way that’s fair to employees, fair to job applicants. I think that scrutiny is particularly high in the HCM industry because HR technology really deals with vital aspects of a person’s livelihood.”
King expects the federal government to eventually develop its own governing law, but it remains unclear if that will be accomplished in 2025.
Some thematic trends appear in the developing corpus of AI legislation: a focus on notice and transparency, a focus on bias mitigation, and human oversight, according to Ameida.
“While I think it can be daunting to companies who try to comply with laws of many different countries or many different states at the same time, these themes that are carrying through all the laws are really going to be where companies are going to want to focus their compliance attention,” Ameida said.
What’s HR to do? “Sign up for an email distribution list through SHRM, for example, where you’d be getting emails with all of these changes. There are some law firms that have a similar email distribution,” King said.
The VirgilHR platform notifies users when regulations or laws change or take effect, and features a compliance calendar in the platform, which includes summaries of all the coming changes, searchable by state or keyword, and sample language for customers to use to update their employee handbooks.
“There are technology products out there that help you with this as well, VirgilHR being one of them, and they help you stay a little more organized, because all of these laws changing all the time make it really difficult to track,” she said.
