TIP SHEET
5 Employment Law Predictions for 2025
As businesses prepare for the evolving landscape of employment law, staying informed is key to navigating upcoming challenges.
Our tip sheet, 5 Employment Law Predictions for 2025, explores critical developments expected in the year ahead.
1. FLSA Overtime Rule
The 2024 Final Rule raising the exempt salary threshold level nationwide, was vacated in November 2024 by a federal court in Texas. As a result, both the July 1, 2024, and Jan. 1, 2025, increases are no longer in effect, nor will any future increase scheduled under the Final Rule take effect. The federal exempt salary threshold level reverts to the pre-2024 level of $35,568 annually ($684 per week). We don’t expect this to change in 2025, although it’s possible we may see some compromise and potentially an increase to the exempt salary threshold somewhere between the July 1 amount of $43,888 and the Jan. 1 amount of $58,656 in the coming years.
2. Paid Leave
The U.S. is the only industrialized country that does not provide paid family medical leave for all workers. It’s unlikely that there will be any movement to develop a paid family leave plan for all workers at the federal level in 2025. We expect this issue to remain active at the state level for the next few years. Employers should keep an eye on local and state paid leave law requirements and changes.
3. Immigration Reform and the Workforce
Expect immigration reform to be a major issue in the next few years. Trump has indicated an intent to carry out largescale deportation in the U.S. If this occurs, it will have a significant impact on the available workers in the U.S. and will affect hiring and employment practices. Employers should take measures to ensure their employment eligibility verification process is airtight, especially in industries heavily reliant on unskilled labor or H-1B labor.
4. Independent Contractors
Just prior to Biden taking office in 2021, the DOL under Trump finalized a new rule which would have made it easier for businesses to classify workers as independent contractors. Biden’s DOL froze the rule, and it never took effect. We expect Trump’s administration to act on this issue in the next few years making things easier for employers to classify workers as independent contractors.
5. Non-Compete Agreements
We do not expect to see major changes to restrictive covenant laws in the next few years at the federal level under the Trump administration. It’s expected that the majority of activity limiting noncompete clauses in agreements is more likely to occur at the state level in the near future.
WEBINAR
More Expert Predictions and Analysis
What should employers keep an eye on in 2025?
View A Look Back, A Look Ahead: 2024 Employment Law Trends, as a panel of experts unravels the major developments from the past year and examines what may lie ahead in 2025. Topics include:
- Captive audience bans, including the NLRB ruling in the Amazon.com Services LLC case
- AI in the workplace, including EEOC guidance, best practices, and AI and wiretapping class actions in CA
- 2025 predictions in employment law under the second Trump administration
Copyright © 2024 GovDocs, Inc. GovDocs is a registered trademark of GovDocs, Inc. This content is intended for market awareness only. It is not to be used for legal advice or counsel.