Congressional Workplace Compliance News & Resources
The United States Congress is always working to write and pass legislation that will impact every aspect of American life. In particular, KPA keeps an eye on the bills and laws that will impact workplace compliance and labor.
Below you’ll find the summaries and action items of new laws that will impact your business and your employees.
Keep up with safety and compliance the right way with this information but seek out your legal counsel when you’re seeking further guidance and more information on how this news directly impacts your business.
Past Congressional Workplace Compliance News
When: Effective June 27, 2023
On May 14, 2021, the U.S. House of Representatives passed the Pregnant Workers Fairness Act (PWFA), and President Biden signed the bill on December 29, 2022. The law becomes effective on June 27, 2023. The U.S. Equal Employment Opportunity Commission and the U.S. Attorney General’s Office are responsible for enforcing the act.
The law requires private employers with 15 or more employees to provide reasonable accommodations to job applicants and employees with medical conditions related to pregnancy or childbirth. It applies to “qualified employees,” which is defined as an employee or applicant “who, with or without reasonable accommodation, can perform the essential functions of the position, with specified exceptions.”
Under the law, a covered employer must:
- Reasonably accommodate the known limitations of the affected employee unless the accommodation would impose an undue hardship on the business;
- Not require the employee to accept an accommodation other than a reasonable accommodation they arrived by participating in an interactive process;
- Not require an employee to take paid or unpaid leave if the employer can make a reasonable accommodation; and
- Not discriminate or retaliate against workers who request pregnancy-related accommodation or exert their rights under the law.
Some cities and states already have existing laws related to accommodation for pregnancy-related conditions, so employers in those regions may not have to change their policies and procedures in order to comply with the new federal law.
- Review your policies, procedures, and accommodation-review process and update them as needed to comply with the law.
- Train HR personnel, managers, and supervisors on the law.
When: Effective April 28, 2023
The Providing Urgent Maternal Protections for Nursing Mothers Act (PUMP Act) was signed into law on December 29, 2022, and becomes effective April 28, 2023. It requires employers to provide reasonable break times to express milk for one year after the child’s birth. The employer must provide a place other than a bathroom that is shielded from view and free from intrusion by coworkers and the public. Break time may be unpaid except where otherwise required by federal, state, or local law, or in cases where the employee is not fully relieved of job responsibilities.
Employers with less than 50 employees may apply for an exemption if they have proof that accommodation would cause them undue hardship.
Employees may file a complaint against an employer for violating the law, but they must notify the employer of the violation and give them up to 10 days to comply before filing suit.
The law covers exempt and non-exempt employees. Air carrier employees are not covered by the PUMP Act. There are some exceptions and delayed effective dates for employees in the railway industry and motorcoach services operators.
- Train HR personnel, managers, and supervisors on the provisions of the law.
- Review your policies to ensure compliance with the law.
When: Effective immediately
President Biden signed the 2023 Consolidated Appropriations Act into law on December 29, 2022, which contains the SECURE Act 2.0 of 2022. The SECURE Act greatly impacts retirement savings plans. Some provisions go into effect immediately or over the next 12 months, while others will go into effect over the following several years.
The provisions that went into effect January 2023 include:
- Employers with 50 or fewer employees creating new plans on January 1, 2023, or later will be able to take advantage of increased tax credits to offset the start-up costs of implementing a new retirement plan. There are also additional credits for employer contributions to the plan over the first five years.
- The Employee Retirement Income Security Act (ERISA) and Internal Revenue Code were amended to mandate automatic enrollment in Section 401(k) and 403(b) plans. Effective for new plans adopted after December 29, 2022, automatic enrollment is required of most major employers. Automatic deferrals will range from 3% to 10% of income. Employees can opt out. There is also a requirement for automatic escalation that increases a participant’s deferrals by one percentage point per year to at least 10% with a ceiling of 15%. These provisions will not become effective until January 1, 2025.
- Effective 2023, employees can elect to have their employer direct matching contributions to their Roth workplace account. Those matches will be taxable income in the year of the distribution.
- Effective 2023, employers may create Roth accounts for SIMPLE and SEP plans that allow after-tax contributions as well as pre-tax contributions.
- Effective 2023, those with a terminal illness or a condition that could reasonably result in death in 84 months or less may take penalty-free early withdrawals from their retirement plan. To avoid the penalty, the person must repay distributions within three years.
- Effective for plan years beginning after December 29, 2022, employers can offer de minimis financial incentives to employees that make salary deferral contributions under a 401(k) or 403(b) plan.
- The age for Required Minimum Distributions increases to 73 effective January 1, 2023.
- If a person does not take the minimum distributions on time, the tax penalty is reduced from 50% to 25% of the amount not taken for tax years beginning after December 29, 2022.
- Beginning in 2023, people aged 70½ and older may elect a one-time $50,000 gift as part of their qualified charitable deduction. This amount will be adjusted annually for inflation. The gift must be made to a charitable remainder unitrust, a charitable remainder annuity trust, or a charitable gift annuity. The amount counts toward the annual RMD where applicable. The gift must come directly from the IRA by the end of the calendar year.
- Starting January 1, 2023, the dollar limitation for qualified longevity annuity contracts (QLACs) premiums increases from $145,000 to $200,000. The law also eliminates a previous requirement that limited premiums to 25% of an individual’s retirement account balance.
- For plan years starting January 1, 2023, plan sponsors no longer have to provide certain notices to employees who have elected not to participate in the retirement plan. Instead, the sponsor must send an annual notice of the employee’s eligibility and the enrollment deadlines.
- Effective 2023, certain RMD barriers affecting the availability of lifetime annuities in qualified plans and IRAs are eliminated.
- Consult with your service providers and legal counsel to make the necessary changes that will bring you into compliance.
- Update your retirement plan documents to reflect the new rules.
- Inform employees about the changes to your retirement plan(s).
When: Effective immediately
President Biden signed the Speak Out Act into law on December 7, 2022. The law went into effect immediately and limits the enforceability of nondisclosure and nondisparagement clauses related to sexual assault and sexual harassment allegations. The purpose is to prevent employers from silencing workers who want to speak out about sexual misconduct in their workplace. The law applies only to agreements entered into with current, former, and prospective employees, and independent contractors before a sexual assault or sexual harassment dispute has arisen.
A nondisclosure clause is one that requires the parties not to disclose or discuss conduct, the existence of a settlement involving conduct, or information covered by the agreement. A nondisparagement clause is one that requires one or more parties not to make a negative statement about another party that relates to the agreement, claim, or case. Under the Act, if the parties sign an agreement containing such clauses pre-dispute, the clauses are not enforceable.
A sexual assault dispute is one “involving a nonconsensual sexual act or sexual contact, as such terms are defined in section 2246 of title 18, United States Code, or similar applicable Tribal or State law, including when the victim lacks capacity to consent.” A sexual harassment dispute is one that relates to “conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.”
The Speak Out Act law does apply to agreements signed before December 7, 2022, but not in cases where the parties agreed to the clauses AND the dispute was active before December 7, 2022. Effectively, this means the law applies to agreements entered into before its effective date, but only when the sexual misconduct claim was filed after that date.
An employer may include such clauses in an agreement in connection with the settlement of a claim or dispute related to alleged sexual misconduct. Employers may continue to use nondisclosure clauses to protect their trade secrets and proprietary information.
Employers need to be mindful of local and state laws that impact these types of clauses in pre-dispute agreements.
- With the assistance of competent counsel, review your employment handbook, policies, and pre-hire and employment agreements that contain arbitration, confidentiality, nondisclosure, or nondisparagement terms and update them as needed to comply with the law.