Welcome to the latest edition of AlphaStaffHCM’s Compliance Updates!
We are pleased to provide you with this Summer 2 edition of the AlphaAdvisor featuring federal and state legal updates including highlighted resources provided by some of AlphaStaffHCM’s trusted legal partners.
This edition features: the DOL’s formal restoration of 2019 FLSA salary thresholds, a pivotal NLRB ruling limiting Section 7 protection for dress codes, Florida’s revised FCRA statutory filing deadlines and digital privacy rulings, San Francisco’s expanded parental leave, and major compliance updates across Illinois, New York, New Jersey, and Colorado.
Note: The information contained in this Compliance Update is for general informational purposes only and is not legal advice.
Watch the video from Lindsay highlighting key topics in the Summer Part Two update
Federal Law Updates
NLRB Limits Section 7 Protection for Workplace Dress Code Violations
July 31, 2026, the National Labor Relations Board (NLRB) issued a major ruling holding that protection for political or social messaging under Section 7 of the National Labor Relations Act requires an objective connection between the message and the employees’ own working conditions (wages, hours, safety, or workplace treatment). Protesting a dress code rule (e.g., via letters, petitions, or off-duty picketing) is protected conduct. However, violating a valid, content-neutral dress code while working is not protected simply because employees do it together. In this instance, the NLRB found that Whole Foods employees who wore Black Lives Matter pins, masks, buttons, and clothing while at work did so in support of the social movement and lacked an objective link to workplace terms and conditions and thus were not protected under Section 7. Read more here.
DOL Formally Rescinds 2024 Overtime Rule and Restores 2019 Exempt Salary Thresholds
The U.S. Department of Labor (DOL) formally rescinded its 2024 overtime rule via a technical amendment, conformed regulations to federal court decisions that vacated the increases nationwide and officially restored the 2019 Fair Labor Standards Act (FLSA) salary thresholds. Following nationwide vacatur by a Texas federal district court in November 2024—which held that the proposed salary jumps unlawfully displaced the statutory duties test—and the DOL’s subsequent withdrawal of its Fifth Circuit appeals, the standard federal salary threshold for executive, administrative, and professional (“white-collar”) exemptions remains at $684 per week ($35,568 annualized). Concurrently, the highly compensated employee (HCE) exemption threshold remains at $107,432 per year (including at least $684 per week paid on a salary or fee basis), eliminating the previously planned increases to $1,128 per week and $151,164 annually, along with automatic triennial updates. While the Fifth Circuit has affirmed the DOL’s general statutory authority to establish a salary floor—leaving open the possibility of future rulemaking—employers must ensure currently exempt staff satisfy both the reinstated 2019 federal salary levels and applicable job duties tests, while continuing to comply with state and municipal laws that establish higher exempt salary requirements. Read more here.
State Updates
California
San Francisco Shortens Paid Parental Leave Tenure Requirement
San Francisco has enacted Ordinance 162-26, significantly easing eligibility requirements for supplemental parental leave compensation under the San Francisco Paid Parental Leave Ordinance (SF PPLO). Under the SF PPLO, covered employers must provide ‘top-up’ pay to employees receiving California Paid Family Leave for new child bonding to bridge the gap between state benefit levels and normal wages. The new ordinance reduces the required employee tenure threshold from 180 days down to just 90 days before paid parental leave eligibility commences. Other qualifying criteria remain unchanged: employees must work at least eight hours per week in San Francisco, spend at least 40% of their total weekly hours working within city boundaries, and qualify for California child bonding benefits. The ordinance takes effect on January 1, 2027, for employers with 100 or more workers, and on January 1, 2028, for employers with 20 to 99 workers. Employers with 19 or fewer employees remain completely exempt. Covered employers should update parental leave policies, employee handbooks, and leave administration procedures accordingly. California employers can read more here.
Colorado
HB26-1283 Limits Employer Handling of Identity Documents and Adds I-9 Notice Mandate
Colorado has enacted HB26-1283 to curb worker exploitation by establishing stringent restrictions on how employers handle government-issued identification documents. Under the law, employers are strictly prohibited from confiscating, demanding, or holding original identity documents belonging to employees or job applicants, with intentional violations carrying Class 2 misdemeanor criminal penalties. Additionally, the legislation introduces a mandatory administrative compliance step: employers must now provide a state-specific written notice explaining these worker protections and collect a signed acknowledgment during initial Form I-9 employment verification and any subsequent reverification processes. This signed acknowledgment must be kept within the employee’s personnel or I-9 records. Employers with Colorado personnel must immediately integrate the required state disclosure into their standard onboarding workflows, update electronic I-9 management platforms, and train HR personnel on document retention limits. Colorado employers can read more here.
Florida
Appellate Court Upholds Employer Drug-Free Workplace Policy Regarding Medical Marijuana
Florida’s Second District Court of Appeal recently issued a critical decision regarding medical marijuana use and workplace drug policies. In a lawsuit brought under the Florida Civil Rights Act by a Hillsborough County firefighter-paramedic placed on unpaid leave following a failed random drug test, the worker argued that a valid state medical marijuana registry card protected off-duty cannabis use. The appellate court reversed a lower court ruling and held in favor of the employer, concluding that the county was not required to create an accommodation or exception to its established Drug-Free Workplace Policy for medical marijuana. However, employers should note that the court’s holding was narrowly tied to the specific language of the applicable collective bargaining agreement and county drug-free policy and does not establish a blanket rule across all private employment relationships. Employers maintaining drug-free workplace programs should review policy wording with legal counsel to confirm explicit standards regarding medical cannabis. Read more here.
Statutory Deadlines Shortened for Workplace Discrimination Claims (CS/HB 1407)
Effective July 1, 2026, Florida enacted CS/HB 1407, amending the Florida Civil Rights Act (FCRA) to institute clear statutory deadlines for pursuing employment discrimination lawsuits, thereby narrowing an employer’s window of ongoing liability. Under the amended statute, civil actions brought under the FCRA must be commenced no later than one year after the FCHR determines reasonable cause or the EEOC issues a notice of right-to-sue letter, whichever occurs earlier. If neither agency issues a determination within 180 days, the law establishes a strict deadline requiring civil claims to be filed within 18 months of the initial complaint filing. The law takes effect July 1, 2026, and applies to actions filed on or after that date.Florida employers and HR teams should update charge tracking calendars and coordinate closely with counsel when evaluating the timeliness of pending and new civil actions and administrative complaints. Read more here.
Illinois
Illinois has recently enacted two significant employment laws that expand worker protections and create new compliance obligations for employers.
SB 3777 Enacts Civil Rights Safeguard Act Codifying Disparate Impact Claims
Illinois has enacted the Civil Rights Safeguard Act (SB 3777), formally embedding ‘disparate impact’ liability into the Illinois Human Rights Act (IHRA) effective January 1, 2027. Under this statute, facially neutral workplace policies and practices that disproportionately burden protected classes are unlawful, even in the complete absence of intentional discrimination. The law covers standard protected classifications as well as citizenship status, work authorization, family responsibilities, and criminal conviction history. Consequently, employers utilizing criminal background checks or standardized screening algorithms must be prepared to substantiate that criteria are job-related and consistent with business necessity. Employers should audit hiring criteria, background check rubrics, and automated screening tools to mitigate disparate impact exposure.
House Bill 4844 Mandates Paid Jury Duty Leave
Under Illinois House Bill 4844, covered employers with more than 25 employees will be required to provide paid jury duty leave at the employee’s regular rate of pay beginning January 1, 2027. Businesses with 25 or fewer employees remain exempt from the compensation requirement. Because the statute leaves key administrative details undefined—including specific calculation methodologies for tipped or commission-based employees and whether pay applies strictly to scheduled shift hours or total jury service hours—employers face potential operational and compliance ambiguity. Employers should review payroll systems, draft formal jury duty leave policies, and conduct management training well ahead of the 2027 implementation date.
A link to an article addressing both recently enacted Illinois laws can be found here.
Menopause Equity and Care Act Expanding Workplace Protections and Insurance Coverage
On August 7, 2026, Illinois Governor JB Pritzker signed the Illinois Menopause Equity and Care Act, establishing menopause-related conditions as a protected classification under the Illinois Human Rights Act (IHRA) effective January 1, 2027. The law makes Illinois one of the first states to outlaw discrimination and harassment based on perimenopause, menopause, and associated medical symptoms (such as vasomotor disruptions, sleep disturbance, cognitive changes, and mood fluctuations), while requiring covered employers to provide reasonable accommodations including flexible scheduling, modified work hours, and climate- or temperature-adjusted work environments. Employers must also update workplace posters and employee handbooks to advise workers of accommodation rights for pregnancy- and menopause-related conditions.
Additionally, effective January 1, 2028, the statute amends the Illinois Insurance Code to require individual and group health plans to cover specified menopause treatments, including fully covered, zero-cost-sharing annual visits for individuals aged 45 and older in plans with more than 25 employees. Employers with Illinois personnel should review accommodation workflows, update handbooks and postings, and coordinate with health benefit administrators ahead of the 2027 and 2028 effective dates. Read more here.
Massachussetts
PROTECT Act Requires 48-Hour Notice for ICE Audits
On August 5, 2026, Massachusetts enacted the PROTECT Act with immediate effect, imposing strict workforce notification requirements following immigration enforcement inquiries. All Massachusetts employers, regardless of workforce size, who receive a Notice of Inspection from U.S. Immigration and Customs Enforcement (ICE) concerning Form I-9s or other employment records must provide written notice to their entire workforce within 48 hours of receipt. The notice must be distributed to all employees, even if the audit targets only a small subset of workers. Because this 48-hour state notification deadline runs concurrently with the federal three-business-day timeline to produce requested records to ICE, HR teams must act immediately upon service. Employers should establish rapid response protocols, pre-draft workforce notification templates, and designate compliance leads for ICE audit requests. Read more here.
Minnesota
Final Rules Clarifying Earned Sick and Safe Time Requirements Adopted
Effective July 6, 2026, the Minnesota Department of Labor and Industry (MNDOLI) adopted comprehensive final administrative rules interpreting the state’s Earned Sick and Safe Time (ESST) law. The rules clarify that employers must explicitly designate their 12-month accrual year or default to the calendar year, establish that changes to accrual years or methods (such as moving between accrual and frontloading) require advance written notice taking effect on the first day of the subsequent accrual year, and define “good faith” evaluation standards for the anticipated 80-hour annual employee eligibility threshold. The regulations also provide structured calculation options for indeterminate shifts, confirm that accrued ESST must be credited no later than the payday following the earned period, permit employers to advance leave, and clarify that incentive bonuses tied to attendance or production goals may be denied due to ESST use—provided the same standard applies across other leave types.
Crucially, the rules give employers flexibility to request reasonable documentation for suspected leave misuse—such as patterns of absences adjacent to holidays, weekends, or previously denied PTO requests—even if the absence is two or fewer consecutive days, while reaffirming that past misuse cannot justify denying future qualifying leave.
Additionally, MNDOLI clarified that statutory ESST protections extend to more generous employer PTO banks only when time off is actually taken for a statutory ESST-qualifying reason and confirmed that benefits under the separate Minnesota Paid Leave Law are excluded as salary continuation. Employers with Minnesota personnel should review written PTO policies, update manager guidance on suspected leave misuse protocols, and align payroll crediting workflows. Read more here.
New Jersey
Major Overhaul of Family Leave Act
Effective July 17, 2026, New Jersey implemented significant amendments to the New Jersey Family Leave Act (NJFLA), substantially expanding employer coverage and easing employee eligibility rules. The law now applies to employers with 15 or more total employees (lowered from 30+), with out-of-state workers counting toward the 15-employee threshold. Employees now qualify for NJFLA leave after just three months of employment and 250 hours worked (down from 12 months and 1,000 hours) to bond with a new child or care for a family member. The amendments also establish that employees receiving New Jersey Temporary Disability Insurance (NJTDI) or Family Leave Insurance (NJFLI) benefits have job restoration rights to the same or an equivalent position, and grant employees the exclusive right to choose the order in which they use earned sick leave versus state disability/family leave benefits without employer mandate. Employers with New Jersey personnel should audit total company headcounts, update employee handbooks, align FMLA/NJFLA coordination workflows, and train frontline supervisors to immediately route all leave inquiries to HR. Read more here.
Anti-Discrimination Laws Apply to Workplace AI and Automated Tools
The New Jersey Division on Civil Rights (DCR) has reinforced that the New Jersey Law Against Discrimination (LAD) applies fully to employment decisions made or influenced by artificial intelligence (AI), machine learning, or predictive analytics. Under the state guidance, employers remain strictly liable for algorithmic discrimination—including unlawful disparate treatment, disparate impact, or failures to provide reasonable accommodations—even if the discriminatory outcomes stem from third-party vendor software, flawed system design, or biased training datasets. This regulatory scrutiny aligns New Jersey with a growing regional and nationwide trend toward heightened algorithmic accountability, joining statutory frameworks such as New York City’s Local Law 144 bias audits, Connecticut’s Senate Bill 5 employee notice mandates, and emerging rules in Illinois, Colorado, and California. To mitigate legal risk, employers utilizing automated tools in hiring, performance management, or promotions should ensure that third-party vendor algorithms are regularly audited for bias, maintain meaningful human oversight over employment decisions, establish accommodation request workflows for automated screening, and periodically analyze AI-generated outcomes for disparate impacts. Read more here.
Appellate Division Limits Privilege Waivers in Attorney-Led Workplace Investigations
In C.S. v. Brick Recycling Company, the New Jersey Appellate Division clarified discovery rules under the New Jersey Law Against Discrimination (LAD), holding that an employer’s reliance on an attorney-led workplace investigation as an affirmative defense does not trigger an automatic, all-or-nothing waiver of the attorney-client privilege or work-product doctrine. Rejecting the wholesale disclosure of thirty-six pages of attorney notes, internal communications, and draft reports ordered by the trial court, the appellate panel ruled that judges must conduct document-by-document—and, when necessary, line-by-line—in camera reviews to determine whether specific records remain protected because they are only “tenuously related” to the defense. The court explained that materials are sufficiently related only if they demonstrate the thoroughness of the inquiry or suggest the employer improperly compromised or influenced the investigation, while purely legal advice, attorney impressions, and potentially draft investigative reports remain shielded. Additionally, the court clarified that pre-suit timing does not defeat privilege if litigation was reasonably anticipated, and the attorney served a dual legal-advisory role. Employers utilizing outside counsel for sensitive workplace investigations should ensure engagement letters clearly define legal advisory roles, maintain meticulous contemporaneous privilege logs, and structure investigative files to protect mental impressions and draft work product during subsequent litigation. Read more here.
New York
Workplace Violence Prevention Mandates for Hospitals and Nursing Homes
New York has enacted workplace violence prevention mandates requiring general hospitals and nursing homes—defined as facilities providing continuous nursing care and lodging to invalid, infirm, or convalescent individuals—to establish formal violence prevention programs within 12 months, starting September 18, 2026, while excluding outpatient clinics, public health centers, and standalone diagnostic facilities. Beginning January 1, 2027, general hospitals must conduct annual site-specific safety assessments with mandatory employee and union participation, implement tailored security plans, and maintain continuous emergency department security based on local population thresholds. Non-compliance carries civil penalties of up to $2,000 per violation under the New York Public Health Law along with potential state injunctions, prompting healthcare employers to audit existing CMS-aligned policies, establish joint risk assessment workflows, and evaluate facility staffing models. Read more here.
Final Rule Interpreting Earned Safe and Sick Time Act Amendments Adopted
Effective July 23, 2026, the New York City Department of Consumer and Worker Protection (DCWP) adopted its final rule implementing recent amendments to the NYC Earned Safe and Sick Time Act (ESSTA). The final rule confirms that covered employers must provide all employees—including part. -time staff and mid-year hires—with 32 hours of immediately available unpaid safe and sick leave upon hire and on the first day of each calendar year without pro-ration. Covered uses include caring for a minor child or care recipient during school holidays, daycare closures, and babysitter cancellations. Employers may impose usage minimums of up to a four-hour initial increment and 30-minute increments thereafter, and those rehiring separated workers within the same calendar year must reinstate any unused unpaid leave. The rule also clarifies that providing some or all of the 32 hours as paid leave does not reduce an employer’s separate statutory obligation to provide standard accrued paid safe and sick leave (up to 40 or 56 hours depending on employer size).
The final rule also introduces a new post-employment disclosure mandate for employers managing leave records electronically, requiring them to either maintain departing employees’ access to electronic leave portals for six months or issue a written balance statement within one week of the final payday. Additionally, to maintain wage-and-hour compliance and avoid improper salary deductions under state and federal law, the DCWP advises that overtime-exempt salaried employees should be paid for partial-day absences when using “unpaid” safe and sick leave. Employers with New York City personnel should update onboarding and offboarding workflows, leave tracking portals, employee handbooks, and payroll deduction rules. Read more here.
S3460 Proposes Mandatory Employee Personnel Record Access and Negative Information Disclosures
The New York State Legislature has passed Senate Bill S3460, amending the New York Labor Law to create Section 210-b and establish a comprehensive personnel records access framework. If signed by Governor Hochul, the statute will take effect 60 days after enactment, requiring covered employers to furnish complete copies of an employee’s personnel file—broadly defined to include performance evaluations, disciplinary records, compensation histories, and application materials—within five business days of a written request at no cost. Crucially, the legislation introduces an affirmative compliance mandate requiring employers to formally notify employees within 10 days of placing any negative or adverse documentation in their personnel file, while granting workers the statutory right to submit written rebuttal statements that must be permanently maintained alongside the record and disclosed to third parties whenever the file is shared.
The bill also obligates employers to maintain personnel records for at least three years post-termination, codifies strict anti-retaliation protections, and establishes civil penalties ranging from $500 to $2,500 per violation enforceable by the Attorney General. Although the legislation does not override collective bargaining agreements providing equivalent or greater access and awaits formal transmittal to the Governor’s desk, employers with New York personnel should begin auditing internal performance management workflows, standardizing HR document retention practices, and training managers on disciplinary documentation protocols to ensure operational readiness. Read more here.