Biden Administration Announces Three New Labor Regulations

The Biden administration has announced three significant new final rules altering major employer/employee relationships.  MEMA joined with other business groups in opposing these rules and will keep you updated on any developments.  If you have any questions, please contact Carter Salwin

Here is a quick rundown.

FEDERAL TRADE COMMISSION BANS NONCOMPETES

• On April 23, the Federal Trade Commission (FTC) issued a ban on virtually all employee noncompete agreements in a partisan 3-2 vote.  The Noncompete Rule bans noncompete agreements with employees of all ranks and seniorities in virtually all industries across the United States.
• On April 24, the U.S. Chamber, NAM, and others filed a lawsuit in federal court challenging the FTC Final Rule.  The Chamber noted that the FTC does not have the ability to write its own competition rules. “This decision sets a dangerous precedent for government micromanagement of business and can harm employers, workers, and our economy.”  

DOL UPDATES WHITE-COLLAR AND HIGHLY COMPENSATED EXEMPTIONS

• On April 23^rd the Department of Labor published the much-anticipated final rule “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees”.
• Briefly the rule increases the minimum pay threshold for overtime pay requiring:
  • Effective July 1, 2024, the overtime threshold for an exempt, executive, administrative, or professional employee (EAP) will increase to $844 per week and on January 1, 2025, it will increase to $1,128 per week.
  • Effective July 1, 2024, the threshold for a highly compensated employee (HCE) will increase to $132,964 per year, and on January 1, 2025, it will increase to $151,164 per year.
  • For both categories, beginning in 2027 and every 3 years thereafter the Secretary of Labor will recalculate and publish revised levels.

These new minimum compensation levels are higher than those in the 2023 proposed rule.

OSHA RELEASES “WALKAROUND RULE”

• Finally, the Occupational Safety and Health Administration (OSHA) recently announced a significant rule change regarding workplace safety inspections. 
• The rule is set to go into effect May 1, 2024.
• The new "Worker Walkaround Representative Designation Process Rule" clarifies employee rights during inspections and grants them more control over who accompanies the OSHA inspector. 
• For example, under the rule a union representative can “walk around” with an OSHA inspector during an inspection of a non-union facility.