Welcome to the latest edition of AlphaStaff’s Monthly Compliance Updates!
We are pleased to provide you with this special Summer Edition – Part 2 of the AlphaAdvisor featuring federal and state legal updates including highlighted resources provided by some of AlphaStaff’s trusted legal partners, to guide and help keep you in compliance.
Note: The information contained in this Compliance Update should not be relied upon as legal advice.
Federal Law Updates
Employers and the One Big Beautiful Bill Act (OBBBA)
On July 4, 2025, the OBBBA became law. The well known “big” bill has various impacts on employers in benefits, hiring of non-citizen workers, and payroll tax changes. The OBBBA includes new fees and stricter requirements that will make it harder for employers to hire non-citizen workers, including longer wait times on renewals for expiring work authorizations. Employers can expect to see immediate impact on their non-citizen labor force due to a large increase in budget for Immigration and Customs Enforcement (ICE) and Border Protection (CBP) operations, dramatically expanding enforcement resources and capabilities.
Most of the OBBBA benefits impacts on employers will occur as soon as 2026, such as increased limit of dependent care Flexible Spending Account contribution, and more offerings for high-deductible plans and Health Savings Accounts, offering employers and employees flexibility in how they use pre-tax health dollars.
For the new tax year starting in December 2025, OBBBA allows for temporary federal tax deductions for overtime work and tips, which could bring greater recruitment to the hospitality sector. The accounting method for both deductions will impact employers in preparing W2s. The IRS is expected to provide guidance likely in October regarding the deductions and how to handle the withholding for W2s. Read here for a more broad overview of the OBBBA laws.
Action Item: AlphaStaff plans to track additional guidance on the OBBBA as the roughly 1,127 page bill is unpacked by legal experts. In October, AlphaStaff plans to offer additional OBBBA guidance via a Webinar series on OBBBA compliance alongside the anticipated IRS guidance. If employers would like to review OBBBA compliance details or review more information on a particular section of OBBBA, additional insights from Jackson Lewis are located here.
Landmark Ruling on ADA Application to Retirees
On June 20, 2025, SCOTUS ruled that former employees do not have the right to sue their previous employer under Title I of the Americans with Disabilities Act (ADA) for discrimination in the administration of post-employment fringe benefits. The Court clarified that the ADA does not extend protection to retirees who neither hold nor seek employment at the time of the alleged discrimination. Read more about this decision here.
OSHA Immediately Enacts Penalty Reductions for Employers
OSHA has immediately increased the number of employees allowed for an employer to qualify for small business reductions in penalties which range from 70%-10%. The new guidance also expands the penalty reductions for employers that have no history of repeated violations and those that take steps to immediately correct a hazard. Read more here.
OSHA Proposes Rule that Will Limit Citations in Risky Jobs
On July 1, 2025, OSHA proposed a rule to limit enforcement of the General Duty Clause for inherently risky activities that are the basis of certain industries and jobs, such as live entertainment, professional sports, and high-risk recreation. The rule would prevent citations for hazards that cannot be removed without essentially changing the nature of the job, if employers take reasonable steps to reduce risk. Learn more about the proposed rule here.
State Law Updates
Employment Law Roundup: Laws Effective July 1, 2025
Here is a brief overview of state specific laws effective July 1, 2025:
- Alaska increases the minimum wage to $13.00 per hour, establishes paid sick leave, and prohibits employers from holding mandatory meetings to share political or religious opinions.
- California, Los Angeles County passed an ordinance that applies to retail companies with over 300 employees worldwide regarding scheduling protections. In addition, Los Angeles’ minimum wage will increase to $17.87 per hour. In Los Angeles County’s unincorporated areas, it will be $17.81 per hour.
- Indiana requires employers to allow time off for parenting-related meetings.
- Kansas updates laws on non-solicitation agreements.
- New Hampshire provides new protections for breastfeeding mothers.
- Oregon will increase its minimum wage to $15.05 per hour. In the Portland metro area, the minimum wage will be $16.30 per hour, and in nonurban counties, it will be $14.05 per hour.
- Vermont requires wage ranges in job advertisements.
- Vermont requires security plans in hospitals for preventing workplace violence and requires a workplace violence incident reporting system.
- Virginia Employers are prohibited from noncompete agreements where employees earn less than $76,081 annually.
- Washington, D.C., will raise its minimum wage to $17.95 per hour. The minimum wage for tipped employees will increase to $12.00 per hour.
- Washington paid sick leave has been amended, to include immigration-related proceedings starting on July 27, 2025.
- West Virginia now requires an age certificate issued by state Division of Labor for teenage employment, as well as written consent of the child’s parent or guardian.
Read more about each state’s new laws here.
California Publishes Notice to Employees on Victim Rights
Per the requirements of previously passed California expanded victims’ leave provisions (Assembly Bill 2499), the California Civil Rights Department (CRD), which is responsible for enforcement of these laws, has published a written notice of employee rights under the expanded law. The new law required the CRD to publish the notice for employers to use by July 1, 2025. Access the required notice and read more here.
Iowa Law Gives Rights to Adoptive Parents
As of May 19, 2025, if an Iowa employee adopts a child up to six years of age, an employer must treat the employee in the same manner as an employee who is the biological parent of a newborn child for purposes of employment policies, benefits, and protections for the first year of adoption. More details regarding how Iowa employers should consider updating their policies here.
Changes to New York’s Leave Laws, Updates on Prenatal Leave
New York has made changes to its prenatal leave laws effective July 2, 2025. Employers must distribute their written sick time and paid prenatal leave policies to employees personally upon hire, within 14 days of the effective date of any policy changes, and upon an employee’s request. Employers can learn about what steps to take in order to comply with the new laws here.