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Special thanks to co-presenters Maria Cecilia Reyes, Victor Estanislao Marina and Katherine Ninanya.

Many employers have made getting their arms around their remote work populations a new year’s resolution for 2024. Simultaneously, a growing number of jurisdictions are offering Digital Nomad Visas to attract foreign nationals — and some countries are actually shifting their rules because they became such a hotspot in recent years. Employers must be aware of the changing landscape, and how new laws might not only impact their Immigration compliance but also how such policies may open them up to tax and benefits ramifications.

In our latest Global Immigration and Mobility Video chat, our on-the-ground immigration and mobility attorneys in the US, Colombia, Argentina and Peru explore the latest options, specific requirements, and legal “gotchas” that employers should watch out for.

Click here to view the video.

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Tracking and complying with federal, state, and local wage and hour requirements has long been top of mind for employer as wage and hour liability continues to be one of the most expense employment law risks. Indeed, in 2022, the 10 largest reported settlements for wage and hour actions totaled $574 million.

Currently, in addition to federal rulemaking and enforcement activities, state and local legislatures and administrative agencies remain extremely active in the wage and hour space, resulting in an increasingly complex compliance environment. Given the intricacies here, we help companies identify the areas of wage and hour law that are most likely to trigger liability.

In 2024, among other things, we recommend that companies invest in compliance related to:

  • Minimum wage changes | Over 20 state and local jurisdictions increased minimum wage requirements effective January 1, 2024, with more to follow. Some states are also eliminating tip credits (e.g. Alaska, California, DC, Minnesota, Montana, Nevada, Oregon and Washington) and subminimum wage categories and imposing new or increased salary thresholds.
  • A tsunami of pay transparency laws | As pay disclosure in job postings requirements continue to gain traction (e.g. in California, Colorado, Connecticut, DC, Hawaii, Illinois, Maryland, Nevada, New York, Rhode Island and Washington) employers should understand how this impacts their compensation and recruitment policies, including how to address employee questions when pay information is disclosed for open roles. Towards the end of 2023, a flurry of class actions were filed in Washington alleging violations of the state’s new pay transparency law. We’re tracking this litigation and will report significant updates.
    • On a related note, we always recommend that companies conduct periodic pay equity audits with counsel to protect against unexplained disparities that may encourage discrimination suits.
    • Also, for a quick and easy way to stay on top of pay transparency obligations globally, we offer a fixed fee Global Pay Equity Compliance Compendium that monitors the legal pay equity requirements and forthcoming developments across 70+ jurisdictions (of which over 40 currently have transparency or reporting requirements). Please contact a member of our team for more information.
  • Comparable pay for temporary workers | In some jurisdictions (e.g. Illinois and New Jersey), day and temporary workers have significant new rights and protections, including comparable pay requirements. It’s important for companies to keep tabs on their temporary worker utilization and the compliance obligations of employers and temporary labor service providers.
  • DOL enforcement and rulemaking | Employers should continue to monitor federal DOL priorities, including:
    • Investigation and prosecution of off-the-clock claims and child labor violations and
    • Rulemaking regarding minimum wage and overtime pay exemptions for executive, administrative, and professional employees.

For wage and hour guidance or defense, please contact a member of our team.

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DC is the first jurisdiction in 2024 to join the likes of many states (including California, Colorado, Connecticut, DC, Hawaii, Illinois, Maryland, Nevada, New York, Rhode Island and Washington) in requiring pay transparency in job postings. 

On January 12, 2024, Mayor Muriel Bowser signed the Wage Transparency Omnibus Amendment Act of 2023. If the Act survives the 30-day period of review by Congress (as required under the District of Columbia Home Rule Act), it will go into effect June 30, 2024. 

The Act will apply to employers with at least one employee in DC.

New Requirements

Covered employers must provide the minimum and maximum projected hourly or salary pay in all job listings, as well as a description of the position. Employers will also be required to disclose the existence of healthcare benefits to prospective employees before the first interview. Further, in line with several states that have passed salary history ban laws, employers will be prohibited from screening applicants based on their wage history, or seeking the wage history of a candidate from a former employer.  Finally, employers will also be required to post a notice in their workplaces notifying employees of their rights under the Act. This notice must be posted in a conspicuous place, in at least one location where employees congregate.  

Continue Reading New Year, New Rules in DC: This January the District of Columbia Joins the Pay Transparency Club
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Illinois employers navigated an avalanche of new laws in 2023, with more on the horizon in 2024 (and even 2025). New paid leave obligations for Illinois (and Chicago and Cook County) employers are a significant change, and additional developments expand employer liability in some circumstances where individuals are victims of gender-related violence. There are also new obligations for employers who use temporary employees, and increased protections for striking workers–not to mention a soon-to-be requirement for employers to include pay scale and benefits information in job postings starting January 1, 2025.

Here are key updates that Illinois employers should be aware of for 2024–and beyond.

1. New paid leave laws in Illinois, Chicago and Cook County

Employers in Illinois, Chicago and Cook County have new paid leave obligations for 2024 under three new laws:

  • The Illinois Paid Leave for All Workers Act (PLAWA) (effective January 1, 2024) requires Illinois employers to provide most employees with a minimum of 40 hours of paid leave per year to be used for any reason at all–not just for sick leave.
  • The Cook County Paid Leave Ordinance (effective December 31, 2023, the sunset date of the prior Cook County Earned Sick Leave Ordinance) covers employees who work in Cook County and largely mirrors the PLAWA. The Cook County Commission on Human Rights will begin enforcement of the paid leave Ordinance on February 1, 2024.
  • The Chicago Paid Leave and Paid Sick and Safe Leave Ordinance (effective July 1, 2024) will require covered employers to provide eligible employees 40 hours of paid sick leave and 40 hours of paid leave (the latter usable for any reason) per 12-month accrual period, for a total entitlement of up to 80 hours of PTO per 12-month period.

Importantly, under both the PLAWA and the Cook County Paid Leave Ordinance:

  • Eligible employees earn 1 hour of paid leave for every 40 hours worked, up to a minimum of 40 hours in a 12-month period (with exempt employees presumed to work 40 hours per workweek for accrual purposes, but leave accrues based on their regular workweek if their regular workweek is less than 40 hours)
  • Though unused accrued paid leave from one 12-month period can be carried over to the next, employers can cap the use of paid leave in one 12-month period to 40 hours
  • Frontloading is permitted, and employers who frontload 40 hours at the beginning of the 12-month period are not required to carry over unused accrued paid leave
  • Employers cannot require employees to provide a reason they are using paid leave, or any documentation or certification as proof or in support of paid leave

The Chicago Paid Leave Ordinance diverges from the PLAWA and the Cook County Ordinance in several ways, including:

  • Covered employees will accrue one hour of paid sick leave and one hour of paid leave for every 35 hours worked-five hours less than what is required to accrue an hour of paid leave under the PLAWA or Cook County Ordinance
  • Employees may carryover up to 80 hours of paid sick leave and up to 16 hours of paid leave from one 12-month accrual period to the next
  • Employers may frontload 40 hours of paid sick leave and 40 hours of paid leave on the first day of the 12-month accrual period. Frontloaded paid leave does not carry over from one 12-month period to the next (unless the employer prevents the employee from having meaningful access to their PTO), but up to 80 hours of unused paid sick leave does
  • Employers with more than 50 employees in Chicago are required to pay the employee the monetary equivalent of unused accrued paid leave when an employee separates from the employer or transfers outside of the City of Chicago (see chart below for specifics)
  • Unlike in the PLAWA or Cook County Ordinance, unlimited PTO is specifically addressed in the Chicago Paid Leave Ordinance (so employers with unlimited PTO policies should review the Ordinance closely)
Continue Reading A Legislative Snowstorm: Key 2024 Updates for Illinois Employers Include a Number of New Leave Obligations and More
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Join us for our virtual New York 2023-2024 Employment Law Update on Tuesday, February 13, 2024 at 1 pm ET.

In this 60-minute session, our team will highlight what employers in New York and the surrounding areas need to know to effectively navigate 2024, with practical tips to handle the latest developments including:

  • The shifting legal landscape impacting employee noncompetes in the US and globally, with a focused update on New York, New Jersey, and Massachusetts (plus important considerations when including noncompetes in equity awards)
  • Best practices for using AI in the workplace, with a look at how New York City’s Local Law 144 is impacting employers, and pending legislation in New York State, New Jersey, and other states
  • A “quick hits” roundup of the most impactful changes for US employers this year, including the status of pay equity / pay transparency requirements and the NLRB‘s recent employee-friendly wave of decisions

Click here to register.

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Baker McKenzie is pleased to invite you to an afternoon exploring strategy and risk in the year of the dragon.

Alongside industry leaders from Meta and Dayforce, this will be an interactive discussion exploring how businesses can harness the power and auspiciousness of the mythical dragon in building a comprehensive data, AI and cyber governance program, folding in audits and risk assessments and staying ahead of the growth in litigation, government scrutiny, and liability in the digital world.

After our substantive discussion, we invite you to stay for cocktails and networking.

Agenda

Building a Comprehensive AI and Data Governance Program

  • Guidelines for determining your company’s risk appetite, understanding your role, forging enterprise relationships to build the program, and leveraging external providers and resources
  • Fundamentals of holistic AI and data governance programs, and how to fold cyber, privacy and AI into your existing framework
  • Understanding new technologies, developing risk and impact assessments and practical steps for mitigating risk and unlocking power of your data

The Growth of Personal and Enterprise Liability in the Digital World

  • Litigation trends from 2023 cyber, privacy and AI cases and lessons learned
  • Criminal and regulatory enforcement trends and risks in the AI space
  • Individual criminal liability for CISOs and beyond (SEC v. Yahoo (Altaba) and SEC v. Solarwinds) and what to do in light of the ever-present risk of an internal or government investigations
Tuesday, February 6, 2024
Program 4:00 to 6:00 pm, Reception to follow
El Prado Hotel, 520 Cowper Street, Palo Alto
Click here to register.
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In late breaking news out of New York, Governor Kathy Hochul has vetoed legislation that would have imposed the most restrictive state-level ban on employee non-competes in the United States. Last June, the New York State Assembly passed S3100, which if signed by Governor Hochul, would have voided any contract restraining anyone from engaging in a lawful profession, trade or business of any kind. It also would have given employees a private right of action and, significantly, did not contain an exception for the sale of businesses, making it more restrictive than even California’s draconian non-compete laws.

The bill faced fierce opposition by Wall Street and other industries that heavily rely on non-competes. As reported by the New York Times, Governor Hochul attempted to negotiate with the bill’s supporters to narrow its scope so that it applied only to lower-wage workers. However, when negotiations broke down, Governor Hochul vetoed the bill.

What’s Next

The bill’s sponsor promises to reintroduce the legislation this year. We don’t claim to be fortune tellers, but the odds of a watered-down restriction on non-competes in New York seem likely in 2024, continuing the hostility states across the country are showing to employee non-competes. However, Governor Hochul’s decision to veto S3100 is an encouraging sign because it recognizes that non-competes play an important role in protecting legitimate business interests. We are watching this space closely and will continue to report developments on our blog.

For a closer look at non-compete developments in the US and the implications in a deal context, tune in to our webinar on January 25. Click here to register.
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Special thanks to co-presenters Teresa Michaud and Bradford Newman.

California’s CLE Compliance Deadline Is Approaching…    
We can help!

If your last name starts with H-M, you are probably well aware that your CLE compliance deadline is right around the corner – February 1, 2024. In addition to the general credit requirement, the state of California requires all attorneys to complete:

  • At least four hours of legal ethics
  • At least one hour on competence issues
  • At least two hours on the elimination of bias in the legal profession and society. Of the two hours, at least one hour must focus on implicit bias and the promotion of bias-reducing strategies.

Our lawyers will offer three virtual sessions, focused on key considerations for AI development and utilization, to help you meet your CLE requirements. These sessions will also offer CLE credit in the states of Illinois, Texas, and New York. Participants requesting CLE for other states will receive uniform CLE certificates. 

Please register and let us know which individual session(s) you plan to attend. We look forward to your participation!

Promoting Unity: Overcoming the Risks of Bias and Prejudice in the Workplace

Tuesday, January 16, 2024 | 1:00 – 2:00 pm Pacific
1 hour Elimination of Bias credit (pending approval)

Continue Reading California AI CLE Series
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Special thanks to co-authors Glenn Fox and Paul DePasquale.

One of the biggest sleeper issues (in my opinion) for US companies when granting equity awards to non-US employees or other service providers is the fact that their heirs may be assessed with US estate tax and be required to file an estate tax return in the US if the individual dies while holding equity awards or shares.

US Estate Tax Exemptions

Individual US taxpayers (i.e., US citizens and non-US citizens who are domiciled in the US) can currently benefit from a significant estate tax exemption: no estate tax is due unless the value of the estate exceeds US$13,610,000 (this is the inflation-adjusted amount for 2024), reduced for taxable lifetime gifts, but doubled for married couples if both spouses’ estates qualify for the exemption. Accordingly, relatively few US estates currently are subject to estate tax. In any event, US employees and their heirs will most likely be well aware of possible estate tax consequences for their assets, including equity awards and shares acquired under a company share plan.

Continue Reading A Cautionary Tale: US Estate Tax May be Due on Equity Awards/Shares Held by Non-US Residents
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Roses are red,
Violets are blue,
You signed a noncompete,
That may not be true.

Last year, California lawmakers double-downed on the state’s hostility to noncompete agreements. One of the new provisions requires written notice to current and former employees that their noncompete is void – unless an exception applies – by Valentine’s Day (February 14, 2024).

Two New Bills Restricting Noncompetes in California

First, as covered in our Legislative Reference Guide, SB 699 extends the reach of the state’s ban on noncompetes to contracts signed out of state; creates a private right of action for employees whose agreements include restrictive covenants and provides for attorney fees for any current, former, or even prospective employee who successfully brings suit against an employer’s use of those restrictive covenants.

Second, AB 1076, codifies the 2008 Edward v. Arthur Andersen decision that invalidated all employment noncompetes, including narrowly tailored ones, unless they satisfy a statutory exception. In addition, impacting your Valentine’s Day plans, the legislation requires California employers to individually notify current and former employees employed since January 1, 2022 in writing by February 14, 2024 that their noncompete clauses are void. Individualized notice is required to the employee’s last known mailing and email addresses.

Continue Reading No Love Lost: California’s Continued Crackdown on Noncompetes Requires Breakup Letters Sent Before Valentine’s Day