Washington Lawmakers Pass ‘Mini-WARN Act’ to Require Notice of Site Closings and Mass Reductions in Force
Washington is close to being the latest state to enact a “mini-WARN Act” that would require employers with fifty or more full-time employees to provide at least sixty days’ notice to the state, any union, and/or employees affected by a business site closing or mass reduction in force.
Quick Hits
Washington State is on track to enact a “mini-WARN Act” requiring employers with fifty or more employees to provide at least sixty days’ notice before business closures or mass reductions in force.
The Washington bill’s notice requirements would go beyond the federal WARN Act.
The legislation includes protections for employees on paid family or medical leave, preventing them from being included in mass reductions, except in limited situations.
Employers that fail to comply with the notice requirement could face significant financial penalties, including back pay plus the cost of benefits for affected employees and civil penalties for violations.
On April 27, 2025, the Washington State Legislature delivered Senate Bill (SB) 5525 to Governor Bob Ferguson’s desk for signature. The bill, titled the “Securing Timely Notification and Benefits for Laid-Off Employees Act,” would provide employee protections in the context of business closings and mass reductions in force (RIF) similar to the federal Worker Adjustment and Retraining Notification (WARN) Act.
The legislation would require most covered employers to provide notice and information beyond what is required by the WARN Act before closing a business location or undertaking a “mass layoff” and protect employees from being included in a reduction while they are taking Washington’s paid family or medical leave. The bill would also grant the Washington State Employment Security Department (ESD), aggrieved employees, or the employees’ union bargaining representative a private right of action to enforce.
‘WARN-Plus’ Notice
SB 5525 tracks the federal WARN Act and would prohibit employers with fifty or more full-time employees from ordering the closing of a business location or “mass layoff” without after a sixty-day period following written notice of such action to the ESD and the affected employees or the employees’ union.
The bill also would require employers to provide a notice, which would contain what the federal WARN Act notice requires, plus:
the name/address of the impacted site and the company contact person;
whether the action is permanent or temporary (and, if temporary, whether it lasts longer or less than three months);
the anticipated date of first employment loss and schedule of losses;
the impacted job titles and names of employees in jobs (the ESD notice must also include the employees’ addresses); and
whether the action “is the result of, or will result in, the relocation or contracting out of the employers’ operations or employees’ positions.”
Employers would be required to provide additional notice if the closure or RIF goes beyond the scheduled dates in the original notice.
Exceptions
The bill would excuse notice in certain circumstances:
the employer is “actively seeking capital or business” at the time the notice is required that could enable the employer to avoid a business closing or mass reduction, and the employer “reasonably and in good faith believe[s]” that providing notice would prevent it from obtaining the capital or business;
the business closing or reduction in force is based on reasons “not reasonably foreseeable at the time the notice would have been required”;
the business closing or reduction in force is due to “a natural disaster,” such as a flood, earthquake, or tornado; and
the mass reduction in force is at certain construction projects in which the employer informed the affected employees that their job was limited to the duration of a particular portion of the project or all affected employees are on a union referral or dispatch system on a “multiemployer construction project.”
Paid Family and Medical Leave Protection
Unless notification is excused, employers would not be permitted to include in a mass reduction in force any employee currently taking paid family or medical leave under the Washington Paid Family and Medical Leave law. Lawmakers passed SB 5525 after considering a similar bill, HB 1313, that did not contain the paid family or medical leave protection.
Separately passed legislation, House Bill (HB) 1213, also on the governor’s desk, would expand the job restoration rights and insurance protection under Washington’s Paid Family and Medical Leave Act (WPFML), adding to the protections provided by SB 5525.
Damages, Penalties, and Right of Action
Under SB 5525, employers that fail to provide the required notice to each aggrieved employee would be liable for various damage including back pay (calculated as the higher of the final rate of compensation or the average regular rate over their last three years, whichever is higher) to each aggrieved employee for each day of violation up to sixty days.
In addition, damages would also include “[t]he value of the cost of any benefits to which the employee would have been entitled had their employment not been lost, including the cost of any medical expenses incurred by the employee that would have been covered under an employee benefit plan.”
However, employers would get credit for payments during the violation period to the employee for wages, voluntary and unconditional payments, and the WARN Act and payments to third parties, such as health insurance premiums or contributions to a defined contribution pension plan.
Employers that fail to provide requisite notice to ESD would also face civil penalties of not more than $500 for each day of the violation.
Also, SB 5525 would allow ESD, aggrieved employees, or the aggrieved employees’ bargaining representative to file a civil lawsuit on behalf of the aggrieved employees, “other persons similarly situated, or both,” within three years of alleged violations. Courts would be able to award reasonable attorneys’ fees and costs to prevailing parties. Courts would also be able to reduce a civil penalty, if they find the employer “conducted a reasonable investigation in good faith and had reasonable grounds to believe its conduct was not a violation.”
Next Steps
Unless Governor Ferguson vetoes SB 5525 before May 17, it will go into effect on July 26, 2025, or ninety days after the close of the legislative session.
EEO-1 Reporting (Maybe) — Get Ready Nonetheless!!
On April 15, 2025, the Equal Employment Opportunity Commission (EEOC) sought approval of its 2024 EEO-1 Component 1 data collection. The EEOC’s new proposed 2024 EEO Component 1 Instruction Booklet (the “Booklet”) changes some reporting obligations for employers. If approved, employers will have from May 20, 2025, to June 24, 2025, to file their reports. Private employers with at least 100 employees must file the EEO-1 report annually. In addition, federal government contractors with 50 employees previously were required to file EEO-1 reports. What is less clear is whether government contractors with less than 100 employees will have to file their EEO-1 report. The EEOC’s proposed Instruction Booklet still requires federal contractors to file. The Booklet does not address whether President Trump’s Executive Order 14173, eliminating Executive Order 11246, changes these reporting obligations.
One major proposed change to the EEO-1 report is the removal of the option for employers to report employees who identify as nonbinary. Employers previously could report nonbinary employees in a separate comment box. If approved, that option would not be available. The instruction booklet does not require employers to collect or report pay data.
Next Steps
We will monitor whether the 2024 Instruction Booklet is approved. In the meantime, employers should collect data by employee job category, as well as by sex and race/ethnicity, now so they are ready to report in May or June.
Physician and Health Care Noncompete Law: New Legislation in 2025
It has been a busy year for health care noncompete legislation. Multiple states have enacted legislation, set to take effect in 2025, banning or limiting noncompete agreements for physicians and other health care workers. Although this post only covers enacted legislation, many other states have proposed legislation pending.
Arkansas: On March 4, 2025, Arkansas enacted a law amending the state’s noncompete statute to ban physician noncompetition agreements. The term “physician” is defined to include any person authorized or licensed to practice medicine under the Arkansas Medical Practice Act and any person licensed to practice osteopathy in Arkansas. The law takes effect in the summer of 2025.
Louisiana: Louisiana enacted a law, effective January 1, 2025, limiting noncompetition agreements for physicians. Effectively, employers cannot have a noncompetition agreement with primary care physicians once they have been employed for three years or with any other type of physician after they have been employed for five years.
The law defines primary care physicians as those who predominantly practice “general family medicine, general internal medicine, general pediatrics, general obstetrics, or general gynecology.” For primary care physicians, the law prohibits a noncompetition provision longer than three years “from the effective date of the initial contract or agreement.” It also prohibits employers from including a noncompetition provision in “[a]ny subsequent contract or agreement between the employer and primary care physician executed after the initial three-year terms.” In the event a primary care physician terminates their employment during the initial three-year term, an employer may enforce a noncompete covenant that prevents the physician from carrying on or engaging in a business similar to that of the employer in the parish in which the primary care physician’s principal practice is located and no more than two contiguous parishes in which the employer carries on a like business. The parishes must be specified in the agreement, and the agreement cannot exceed a period of two years from the date of the physician’s termination.
The same limitations apply for all other types of physicians, except an employer may enforce a noncompetition agreement against a non-primary care physician if the employer terminates the physician’s employment within the first five years (as opposed to three for primary care physicians).
The law explicitly excludes certain physicians: specifically, physicians employed or under contract with a rural hospital or physicians employed or under contract with a federally qualified health care center. Furthermore, the law only applies to employment-based agreements. Louisiana’s statute specifically permits noncompetition and nonsolicitation agreements in the sale-of-business context. Louisiana Rev. Stat. § 23:921(C).
Maryland: Maryland enacted a law, which takes effect July 1, 2025, limiting noncompetition agreements for employees who (1) earn less than $350,000 per year, and (2) are either (i) required to be licensed under Maryland’s Health Occupations Article or (ii) are employed in a position that provides direct patient care. For such employees, a noncompete agreement must be limited to one year and cannot exceed ten miles from the primary place of employment.
Pennsylvania: Last summer, Pennsylvania enacted the Fair Contracting for Health Care Practitioners Act (the “Act”), which became effective January 1, 2025. The Act, which is not retroactive, limits certain noncompetition provisions entered by licensed medical doctors, osteopaths, nurse anesthetists, registered nurse practitioners, and physician assistants. Specifically, outside the sale-of-business context, the Act only permits noncompete provisions for health care practitioners if (1) the provision does not exceed one-year post-employment, and (2) the employer seeking to enforce the provision notifies certain patients within 90 days of the health care practitioner’s termination.
Utah: Utah passed a law on March 26, 2025, effective May 7, 2025, that prohibits a “health care services platform” from requiring a health care worker to enter into a noncompetition agreement. The law defines “health care services platform” as “a person that operates or offers for use” an “electronic program, system, or application through which a health care worker may accept a shift to perform a health care service or role, as an independent contractor, at a health care facility.”
Arkansas, Louisiana, Maryland, Pennsylvania, and Utah are not the only states that impose heath care-specific limitations on noncompetition agreements. For instance, Texas, Florida, Colorado, Tennessee, and Washington, D.C., among other states, have long-standing limitations on physician-based noncompetition agreements. Most states impose some form of restrictions, ranging from very minor limitations to outright bans. Employers expecting to enter noncompetition agreements with health care employees should work with counsel to understand the state-specific limitations and requirements. We will continue to monitor and report on developments in this highly dynamic area of law.
Illinois Broadens Scope of Whistleblower Act, Strengthening Protections for Whistleblowers in the State
The Illinois Whistleblower Act (the “Act”) provides protections to employees who make reports of certain fraudulent and illegal conduct occurring in their workplaces. In the past legislative session, the Illinois General Assembly broadened and expanded these protections with the enactment of Public Act 103-0687 (the “Amendments”). The Amendments, which became effective on January 1, 2025, redefine key terms in the Act, expand the scope of conduct that is protected, and enhance the penalties and enforcement actions available for violations of the Act.
Redefinition of Employee
Most notably, the Amendments clarify the definition of an “employee” to which the Act applies. Specifically, “employees” covered by the Act exclude independent contractors. The Amendments adopt the stringent ABC test to determine whether a worker is an employee covered by the Act or is an independent contractor who is not covered.
The ABC test looks to whether (1) the worker is free from the control of the employer; (2) the worker performs work in the usual course of business of the employer; and (3) the worker is in an independently established trade or occupation.
The Amendments also redefine “employee” to include licensed physicians working at facilities that receive state funds.
Increased Scope of Protections
The Amendments increase protections related to employee disclosures. Employers may not take retaliatory action against an employee who discloses or threatens to disclose:
During an investigation, court proceeding, or an administrative proceeding, information related to the conduct of the employer if the employee has a good faith belief the employer has violated a law or regulation or poses a substantial and specific danger to employees, public health, or safety;
To a government or law enforcement agency, information related to the conduct of the employer if the employee had a good faith belief the employer has violated a law or regulation or poses a substantial and specific danger to employees, health, or safety; and
To a supervisor, principal officer, board member, or supervisor in an organization with a contractual relationship with the employer, information related to the conduct of the employer if the employee has a good faith belief that the employer has violated a law or regulation or poses a substantial and specific danger to employees, public health, or safety.
The Amendments similarly increase protections for employee refusals. To that end, employers may not take retaliatory action against an employee for refusing to participate in an activity that the employee has a good faith belief would result in a violation of law or regulations.
The Amendments further clarify what constitutes retaliatory action by an employer. Retaliatory action is defined as adverse action by an employer that would dissuade a reasonable worker from making a protected disclosure or refusal under the Act. Retaliatory action specifically includes, but is not limited to, action that would interfere with the employee’s future employment or action that constitutes an immigration-related practice prohibited by the Illinois Human Rights Act, as well as contacting or threatening to contact immigration authorities.
Heightened Penalties and Additional Enforcement
The Amendments impose heightened penalties for violations of the Act.
Specific additional penalties include the ability for employees to obtain injunctive relief; 9% yearly interest on their back pay; front pay; liquidated damages of up to $10,000; and a civil penalty of $10,000 payable to the employee. The Amendments also include a provision that allows the Illinois Attorney General to initiate civil actions against employers for violations of the Act.
Conclusion
Following enactment of these Amendments, employers who operate in Illinois must now navigate a broader scope of protected activities and ensure compliance with these enhanced protections against retaliation.
Illinois employers would be wise to review and revise their internal policies, training programs, and reporting mechanisms to align with these new protections. Employers should consult with counsel if they have questions as to the implications of these Amendments as well as their compliance with the Illinois Whistleblower Act.
Multistate Monday: Employment Verification and Immigration Inspections, Part II [Podcast]
In this episode of our Multistate Monday podcast series, Dee Anna Hays (co-chair of the firm’s Multistate Advice and Counseling Practice Group), Susan Gorey, and Stephanie Generotti continue their discussion on E-Verify, I-9 requirements, and state-specific mandates. In part two of their conversation, they focus on three types of warrant-based scenarios—administrative, judicial, and operational search—and explain the purpose and scope of each type of warrant. They also emphasize the importance of employers being prepared to respond appropriately to each scenario by designating a point of contact and training frontline employees who may be the first to encounter a U.S. Immigration and Customs Enforcement (ICE) agent.
Find part one of this series here
Proportional Fault Indemnification Provisions Held Enforceable in Alabama
The Alabama Supreme Court found that an indemnification provision was enforceable that required a subcontractor to indemnify a general contractor on a proportional-fault basis against liability for death or personal injury.
JohnsonKreis Construction Company, Inc. subcontracted with Howard Painting, Inc. to perform work on a hotel project in Birmingham, Alabama. The subcontract included an indemnification provision that required Howard to indemnify JohnsonKreis for “personal injury, death […] and/or property damage arising out of or related to Subcontractor’s […] negligence or fault […] but only to the proportional extent of Subcontractor’s responsibility for same.” The subcontract also required Howard to name JohnsonKreis as an additional insured. During the project, an employee of one of Howard’s subcontractors died after falling from a window on an upper floor of the hotel. The deceased employee’s estate filed a lawsuit against JohnsonKreis and Howard.
Disputes arose between Howard and JohnsonKreis regarding the scope of indemnity and coverage. JohnsonKreis and its insurer sued Howard and its insurer for breach of the subcontract for various claims, including (a) failing to comply with safety protocols, (b) failing to comply with stated insurance requirements (which included naming JohnsonKreis as an additional insured), (c) bad faith against Howard’s insurer, and (d) subrogation/contribution.
Howard argued in its motion for summary judgment that JohnsonKreis was not entitled to indemnification because Alabama does not permit the apportionment of damages among joint and several tortfeasors. The trial court agreed with Howard’s argument and entered summary judgment in its favor.
JohnsonKreis and its insurers appealed. The Alabama Supreme Court held that the subcontract’s proportional indemnification provision was valid and enforceable and reversed the trial court. Specifically, the court explained:
It is true, as [Howard] argues, that the damages available on a wrongful-death claim under Alabama law are punitive in nature and that a wrongful-death plaintiff is entitled to a single recovery that “cannot be apportioned [by a jury] among joint tort-feasors,” i.e., neither Alabama’s wrongful-death statute, see § 6-5-410, Ala. Code 1975, nor our common law provides for indemnity or contribution in a wrongful-death case. Tatum v. Schering Corp., 523 So. 2d 1042, 1045 (Ala. 1988). However, this is not a wrongful-death case — it is a contractual dispute based on the language of a particular subcontract agreement — and that general rule may be altered by an indemnification agreement between the parties. See Holcim (US), Inc. v. Ohio Cas. Ins. Co., 38 So. 3d 722, 728 n.1 (Ala. 2009) (“Here, the indemnity agreement is part of a contractual relationship between two parties, and the dispute between them is not one of a claimant and a tortfeasor.”). Specifically, as we most recently reiterated in Mobile Infirmary Ass’n v. Quest Diagnostics Clinical Laboratories, Inc., 381 So. 3d 1133 (Ala. 2023), this Court has recognized that “parties may enter into agreements that allow an indemnitee to recover from the indemnitor even for claims resulting solely from the negligence of the indemnitee,” i.e., this Court has recognized that parties may freely reach “a contractual agreement providing a form of otherwise barred joint-tortfeasor contribution.” 381 So. 3d at 1141. See also Holcim, 38 So. 3d at 729 (“[I]f two parties agree that the respective liability of the parties will be determined by some type of agreed-upon formula, then Alabama law will permit the enforcement of that agreement as written.”), and Parker Towing Co. v. Triangle Aggregates, Inc., 143 So. 3d 159, 167 (Ala. 2013) (“The general rule in Alabama is that, in the absence of a statutory or contractual basis otherwise, there is no contribution or indemnity among joint tortfeasors.” (emphasis added)). Cf. Industrial Tile, Inc. v. Stewart, 388 So. 2d 171, 176 (Ala. 1980) (“[I]f the parties enter into an agreement whereby one party agrees to indemnify the other, including indemnity against the indemnitee’s own wrongs, if expressed in clear and unequivocal language, then such agreements will be upheld.”). In fact, in Mobile Infirmary, supra, the main opinion specifically referenced the legality and the enforceability of an agreement requiring “that each party was required to indemnify the other for any proportional share of fault in the case of potential joint liability” — almost the exact language included in the subcontract agreement at issue in this case. 381 So. 3d at 1143.
Thus, the subcontract agreement, to the extent that it required Howard to indemnify JohnsonKreis against liability for personal injury or death occurring on the project site to the proportional extent of Howard’s responsibility for such injury and death, appears, contrary to the trial court’s sole finding, to have been valid and enforceable under Alabama law. Accordingly, the trial court’s decision is due to be reversed.
The Alabama Supreme Court remanded the case to the trial court for further proceedings. A copy of the court’s entire decision can be found here.
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Navigating California’s New Regulations on Automated Decision-Making Tools
The California Civil Rights Department (CRD) has recently approved regulations under the Fair Employment and Housing Act (FEHA) to address discrimination in employment resulting from the use of automated decision-making systems, including artificial intelligence (AI) and algorithms. These regulations apply to all employers covered by the FEHA and will likely take effect in July, once they complete the final administrative process of approval by the Office of Administrative Law.
Definition of Automated Decision Systems
An automated decision system (ADS) is defined as a computational process that makes or assists in making decisions regarding employment benefits such as hiring, promotion, selection for training programs, or similar activities. An ADS can result from AI, machine learning, algorithms, statistics, or other data processing techniques. The definition of ADS does not include word processing software, spreadsheet software, or other commonly used software for day-to-day work.
Regulations Against Discrimination
Under these regulations, it is unlawful for an employer to use ADS or selection criteria that discriminate against applicants or employees based on protected categories defined under FEHA. Evidence of anti-bias testing of ADS or similar practices may support defenses against discrimination claims. Anti-bias testing involves evaluating automated decision-making systems to identify and mitigate biases that may lead to unfair or discriminatory outcomes, ensuring the system operates equitably across different demographic groups. However, methods of conducting anti-bias testing may vary depending on the ADS used.
Recordkeeping
The regulations require preserving ADS data and related records for four years from either the date of the data’s creation or the personnel action involved, whichever occurs later, similar to other types of personnel records and selection criteria. Other revisions include adding ADS to regulations in the definition of “application” or included in “recruitment activity.” Additionally, the regulations specify that using ADS for certain skill testing may necessitate providing reasonable accommodations for religious beliefs or disabilities, ensuring non-discriminatory practices.
Compliance for Employers
For employers in California, the regulations clarify that when using ADS for any aspect of employment, caution should be applied to avoid discrimination.
The Northern District of Illinois Endorses “But For” Causation Standard for AKS-Premised False Claims Act Cases
A circuit split over the causation standard under the federal Anti-Kickback Statute (AKS) could grow wider after a recent Northern District of Illinois (NDIL) decision. In United States ex rel. Jeffrey Wilkerson & Larry Jackson v. Allergan Ltd., Case No. 22-CV-30130, Judge Lindsay C. Jenkins weighed in on the standard, ruling that “resulting from” in a 2010 amendment to the AKS requires “but for” causation in AKS-False Claims Act (FCA) cases. This opinion aligns with the First (2025), Sixth (2023), and Eighth (2022) Circuits, which deviated from the Third Circuit’s (2018) interpretation that “resulting from” requires some “link” between a kickback and the false claim short of but-for causation.
The Allergan opinion highlights circuit court disagreement regarding the AKS “but for” causation standard and the potential expansion of that split. The opinion also underscores the importance of this issue, as the Court provided detailed guidance as to the types of allegations it viewed as sufficient to show causation.
But-For Causation in the Seventh Circuit
In 2010, Congress amended the AKS to provide that “a claim that includes items or services resulting from [an AKS violation] constitutes a false or fraudulent claim for purposes of [the FCA].” The meaning of that simple phrase, “resulting from,” remains a divisive issue in courts across the country. While the Seventh Circuit has yet to address the 2010 amendment with respect to FCA cases, in 2024 the Court opined on the meaning of “resulting from” in Stop Illinois Health Care Fraud, LLC v. Sayeed. The Court concluded it requires “some causal nexus between the allegedly false claims and the underlying kickback violation.” Although the Seventh Circuit did not rule on what specific level of causation the AKS requires — whether “but-for causality or something less” — Sayeed proved instructive to Judge Jenkins’ decision in Allergan.
Holding in Allergan
The Relators in Allergan are former employees who allege that, during their employment at Allergan, the company “devised a scheme” to provide illegal kickbacks. These kickbacks, according to the Relators, were payments made to physicians across the country, who were hired to educate others about Allergan pharmaceutical products.
The Relators argued that because the physicians were being paid to speak about Allergan products, subsequent claims paid for those prescriptions violated the FCA. The court disagreed, noting the argument “is nothing more than the causation-less temporal standard rejected by the Seventh Circuit in Sayeed.” The court further ruled that “all that matters” for an AKS violation is a defendant’s “intent in paying the kickbacks,” not “whether any prescriptions were written as [a] result of the kickbacks.” Further referencing Sayeed, the court noted the Seventh Circuit was clear that “resulting from” requires some level of “actual causality” and agreed with the First, Sixth, and Eighth Circuits that it requires but-for causation rather than a mere link between payments and claims (as endorsed by the Third Circuit).
The court also explicitly discounted a differing Third Circuit opinion, Greenfield v. Medco Health Solutions, finding the concerns “animating the Greenfield court decision … not persuasive.” In doing so, the court highlighted that “all the other Circuits to directly address the question point in one direction — holding that ‘resulting from’ requires but-for causation for claims made under the 2010 Amendment.” After examining the text of the statute and the Seventh Circuit’s guidance in Sayeed, the Court agreed that but-for causation is the appropriate standard.
Applying that standard, the Court held that for all but a few physicians, the Relators’ claims failed because the Relators alleged only a mere correlation of “an uptick in prescriptions” and the speaker program payments. The Court explained that “Relators should present data that controls for other variables such that an increased number of prescriptions by” physicians who participated in the program “is likely attributable to Allergan’s payments.” The Court gave examples of allegations that would suffice, such as “identifying specific quid pro quos” or “comparing Speaker Bureau physicians’ prescription rates against prescription rates of doctors not receiving” Allegan payments.
Looking Ahead
Because some of the Relators’ allegations in Allergan survived the motion to dismiss, the case likely will not yet be appealed to the Seventh Circuit. However, Allergan provides a potential roadmap for arguments in the NDIL and sets the stage for another appellate decision on this issue. While Allergan falls in line with other circuit courts ruling in favor of but-for causation for AKS-premised FCA cases, a circuit split remains.
The Supreme Court declined to review the issue in 2023, but as more cases like Allergan progress, lower courts are likely to reach differing conclusions until the Supreme Court weighs in. Foley will continue to monitor developing case law and provide updates on this issue.
Florida Legislature Passes Restrictive Covenants Bill
On April 24, 2025, the Florida Legislature passed legislation to create two new forms of noncompetes for employers and businesses: a covered garden leave provision and a provision limiting noncompetes to a specific geographic area and time period.
Quick Hits
On April 24, 2025, the Florida Legislature passed legislation (HB 1219) to permit two new forms of allowed noncompete provisions under Florida law.
The new provisions include a covered garden leave provision and a provision limiting a noncompete to a specific geographic area and time period, both of which would be enforceable through injunctive and other relief.
If enacted, HB 1219 will become effective on July 1, 2025.
House Bill (HB) 1219, titled, the “Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act,” does not amend Florida’s current noncompete statute, Florida Statute 542.335, or Florida’s trade secret statute, Florida Statute 688.001, et seq. These newly allowed noncompete provisions are over and above existing allowed noncompete provisions under Florida law.
The covered garden leave provision allows an employer to retain an employee or contractor during a post-employment “notice period,” during which the employer continues to pay the employee’s salary and benefits while the employee sits out of work, restricting the employee from engaging in competitive employment. The employee can work with another employer during the notice period, but only with the permission of the current employer. Under a covered garden leave provision, the notice period can last up to four years but can be reduced with at least thirty days’ advance notice in writing to the employee.
The second noncompete provision is similar to F.S. 542.335, which restricts an employee or contractor from competing in a specified geographic area for a specified time. Like the covered garden leave provision, this restricted period can last up to four years. In order to enforce this provision:
the employer must advise the employee, in writing, of the employee’s right to seek counsel at least seven days before the employee is required to sign any agreement containing a covered noncompete provision;
the agreement containing the covered noncompete provision must include an acknowledgement that the employee will receive “confidential information or customer relationships”; and
the covered noncompete provision must provide that it is “reduced day-for-day by any nonworking portion of the notice period, pursuant to a garden leave [provision] between the employee and the covered employer.”
Both newly allowed noncompete provisions will be enforceable through injunctive and other relief. If an employer seeks to enjoin an employee under either provision, the court must grant preliminary injunctive relief. The injunction may only be modified or dissolved if the employee establishes, by clear and convincing evidence, based on nonconfidential information, that:
the covered employee will not perform, during the noncompete period, any work similar to the services provided to the employer or use confidential information or customer relationships of the employer; or
the employer has failed to either pay or provide (a) the salary and benefits provided for in the covered garden leave provision during the notice period and has had a reasonable opportunity to cure the failure, or (b) pay the consideration provided for in the noncompete provision and the employer has had a reasonable opportunity to cure the failure; or
for agreements containing covered noncompete provisions, the business, entity, or individual seeking to employ or engage the employee is not engaged in, and is not planning or preparing to engage in, any business activity similar to those of the employer during the noncompete period and in the geographic area described in the agreement.
There are several other conditions that apply to one or both of these new forms of noncompete provisions. For example, a covered garden leave provision applies to either a covered employee who maintains a primary place of work in Florida or a covered employer whose principal place of business is in Florida. If HB 1219 becomes law, employers should confirm they are following the notice requirements and other requirements to ensure compliance.
If HB 1219 is signed into law by the governor, it will become effective on July 1, 2025.
2026 Inflation-Adjusted Health and Welfare Plan Limits
On May 1, 2025, the IRS released Rev Proc 2025-19 which updated for 2026 the limits applicable to certain health and welfare plans, including the following key limits:
2026 Limit
2025 Limit
Health FSA – Maximum contributions
$4,400 (self-only)
$8,750 (family)
$4,300 (self-only)
$8,550 (family)
HDHP – Minimum Deductible
$1,700 (self-only)
$3,400 (family)
$1,650 (self-only)
$3,300 (family)
HDHP – Maximum Out of Pocket
$8,500 (self-only)
$17,000 (family)
$8,300 (self-only)
$16,600 (family)
Maximum employer excepted benefit HRA contribution
$2,200
$2,150
These 2026 limits are effective for HSAs for calendar year 2026, and for excepted benefit HRAs for plan years beginning in 2026.
The Courts Weigh in on OCR’s Title VI Guidance and the U.S. Department of Education’s Certification Requirements
On April 24, 2025, federal courts in New Hampshire, Maryland, and the District of Columbia weighed in on three separate challenges brought against the U.S. Department of Education’s February 14, 2025 Dear Colleague Letter (“DCL”), the March 1, 2025 Frequently Asked Questions (“FAQs”), and the April 24, 2025 Certification Requirement for states and public school districts (the “Certification”).
Hunton previously discussed the key takeaways from the DCL and the FAQs for institutions of higher education in our March 27, 2025 client alert, available here.
In three different challenges heard by three different federal courts, the courts overall found in favor of the organizational plaintiffs based on Fifth Amendment vagueness claims, First Amendment claims, and Administrative Procedure Act claims. The result is that the U.S. Department of Education’s enforcement of compliance with Title VI based on the DCL, FAQs, and the Certification is currently halted across the United States.
The individual cases are summarized as follows:
In National Education Association v. U.S. Department of Education (D.N.H.) (1:25-cv-00091-LM), the named plaintiffs included the National Education Association (NEA) and NEA’s affiliate in New Hampshire (NEA-NH) and the Center for Black Educator. In this case, the Court granted a preliminary injunction halting enforcement of the DCL – but not a nationwide injunction. Rather, the preliminary injunction applies to the named plaintiffs and “entities receiving federal funding that employee or contract with plaintiffs or plaintiffs’ members.” The NEA, according to its website has more than 3 million members, in school districts across the country,
In American Federation of Teachers v. U.S. Department of Education (D. Md.) (Case No. 1:25-cv-00628-SAG), the American Federation of Teachers (AFT) and AFT’s affiliate in Maryland (AFT-MD), the American Sociological Association, and Eugene School District 4J brought suit against the U.S. Department of Education. In this case, Court stayed the enforcement of the DCL pending further court resolution, but did not enjoin the FAQs. The court explained that the U.S. Department of Education can only pursue Title VI enforcement actions “consistent with long-standing principles and the dictates of SFFA” (referring to the Supreme Court’s decision prohibiting considerations of race in college admissions in Supreme Court v. Harvard, 600 U.S. 181 (2023)). The Court further explained that assuming the Certification is considered “an implementation of the [Dear Colleague] Letter, it would of course be improper for the government to initiate enforcement based on a stayed policy, through [this] certification or otherwise.” The Court was clear that these remedies were not limited to just the parties in this case, but apply nationwide.
In NAACP v. U.S. Department of Education (D.D.C.) (Case No. 1:25-cv-01120), the Court enjoined the U.S. Department of Education from implementing and enforcing the Certification on a nationwide basis. Specifically, the Court prohibited the U.S. Department of Education from:
“requir[ing] any entity or individual subject to the Certification to make any ‘certification’ or other representation or assurance pursuant to the Certification.”
“impos[ing] any consequences on any entity or individual subject to the Certification for failing to submit a Certification.”
“initiat[ing] any enforcement action, including, but not limited to, a False Claims Act suit, against any entity or individual which has already submitted a Certification, arising out of any representation made or assurance given by such entity or individual in complying with the Certification.”
The combined effect of these three decisions limits – at least for now – U.S. Department of Education’s ability to enforce any reading of Title VI and its implementing regulations beyond established law. This includes enforcement related to DEI programs and initiatives.
However, as of April 28, 2025, all of these enjoined or stayed documents remain on OCR’s Policy Guidance webpage, available here.
Beltway Buzz, May 2, 2025
The Beltway Buzz™ is a weekly update summarizing labor and employment news from inside the Beltway and clarifying how what’s happening in Washington, D.C., could impact your business.
100 Days of the Trump Administration 2.0. April 29, 2025, marked the one hundredth day of President Trump’s second term of office. Set forth below are the key labor and employment policy changes that have occurred thus far.
Diversity, Equity, and Inclusion
Through various executive orders, the Trump administration has upended the diversity, equity, and inclusion (DEI) landscape, both within the federal government and for private-sector employers. These directives are still subject to multiple legal challenges and expected further action from U.S. Attorney General Pam Bondi. As noted in further detail below, the U.S. Equal Employment Opportunity Commission (EEOC) and the Office of Federal Contract Compliance Programs (OFCCP) will be focusing on this issue as well. In Congress, the Buzz is monitoring the status of the Dismantle DEI Act. Additionally, President Trump issued an executive order instructing all federal agencies to “deprioritize enforcement of all statutes and regulations to the extent they include disparate-impact liability,” which allows for a finding of discrimination if an otherwise neutral employment policy or practice results in an adverse impact on a protected class.
Other Executive Orders
Nondisplacement of federal contractor employees. President Trump rescinded Executive Order 14055, which obligated successor federal contractors to make job offers to workers employed under predecessor contracts. As the Buzz has noted, this is a policy shift that has been ping-ponging across administrations for thirty years.
Minimum wage. President Trump rescinded an executive order issued by President Biden in 2021 that increased the minimum wage for employees of federal contractors to $15 per hour (which was set at $17.75 per hour at the beginning of 2025 as a result of annual increase provisions contained in the Biden executive order).
“Good Jobs” executive order. President Trump rescinded President Biden’s “Good Jobs” executive order, which encouraged federal agencies to require potential contractors to adhere to certain labor and employment standards, such as project labor agreements, prevailing wages, and paid leave.
Changes to Rulemaking Processes
State Department extends “foreign affairs” rulemaking exemption governmentwide. Secretary of State Marco Rubio issued a notice concluding that any federal agency rulemaking addressing “the status, entry, and exit of people, and the transfer of goods, services, data, technology, and other items across the borders of the United States” is subject to the “foreign affairs” exemption of the Administrative Procedure Act (APA), meaning that the rule does not have to go through the public notice and comment process.
Directing the repeal of unlawful regulations. President Trump has instructed all federal agencies to repeal any regulation “that clearly exceeds the agency’s statutory authority or is otherwise unlawful” by proceeding under the “good cause” exemption of the APA, which also avoids the public notice and comment process.
U.S. Department of Labor (DOL)
Personnel. The confirmations of Secretary of Labor Lori Chavez-DeRemer and Deputy Secretary of Labor Keith Sonderling are important steps towards reversing the Biden-era DOL enforcement and regulatory agendas. Though without confirmed leaders of the Wage and Hour Division and the Occupational Safety and Health Administration (OSHA), it remains unclear as to how the administration will handle the overtime, independent contractor, and walkaround regulations (which are all subject to legal challenges), as well as OSHA’s heat illness prevention proposal.
OFCCP gutted. President Trump revoked President Lyndon Johnson’s Executive Order 11246 (a nearly sixty-year-old order that established affirmative action requirements for federal contractors), thus gutting OFCCP (though contractors still have ongoing obligations regarding the recruitment and hiring of veterans and individuals with disabilities). Although it is being reported that OFCCP will reduce its staff by approximately 90 percent, a new director has been appointed, and she has indicated that the agency will review data that has already been submitted by federal contractors for evidence of discrimination related to employer DEI efforts.
National Labor Relations Board (NLRB)
Personnel. As expected, President Trump fired NLRB General Counsel Jennifer Abruzzo shortly into his administration. What was perhaps not expected was that President Trump dismissed NLRB Member Gwynne Wilcox (while allowing Wilcox’s fellow Democratic member of the Board, David Prouty, to remain). Trump’s ouster of Wilcox—which she subsequently challenged in federal court—will test his theory that the National Labor Relations Act’s restrictions on removing Board members are unconstitutional. Ultimately, the Supreme Court of the United States will rule on this issue, which will likely have ramifications, not just for the Board, but for other independent federal commissions and boards.
The Board lacks a quorum. While we wait for the confirmation of a new general counsel and new Board members, the Board cannot operate with just Prouty and Chair Marvin Kaplan. Thus, the employer community is still operating under policies established by the Board over the last four years, which include card-check organizing, limitations on employer speech, expanded remedies, and ambush elections, among others.
Federal Mediation and Conciliation Service (FMCS)
Like OFCCP, FMCS—which was reportedly involved in several spending scandals in recent years—is now down to a skeleton crew of employees. Many labor practitioners found the agency helpful in resolving labor disputes.
U.S. Equal Employment Opportunity Commission
Personnel. President Trump dismissed commissioners Jocelyn Samuels and Charlotte Burrows, and he appointed Republican commissioner Andrea Lucas to serve as the EEOC’s acting chair. President Trump also fired the EEOC’s general counsel, Karla Gilbride. Andrew Rogers is currently serving as acting general counsel of the EEOC. President Trump has nominated Rogers to lead the DOL’s Wage and Hour Division.
DEI. Acting Chair Lucas is operating the Commission in conjunction with the administration’s focus on DEI. To that end, the Commission has issued two technical assistance documents addressing what the Commission—and the administration—believe to be unlawful DEI practices.
No quorum, no votes. With only Commissioner Andrea Lucas and Commissioner Kalpana Kotagal remaining on the EEOC, the Commission lacks a functioning quorum. This means that Acting Chair Lucas will not be able to make changes to the regulations implementing the Pregnant Workers Fairness Act, as well as the Commission’s guidance on sexual harassment. Further, with Lucas at the helm, employers can feel confident that the Commission will not pursue any effort to collect salary data from employers.
Immigration
Immigration has clearly been a top priority for the administration, with much of the focus on the southern border, deportation, and attempts to limit or terminate humanitarian parole programs (such as Temporary Protected Status for Venezuela and the Cuba, Haiti, Nicaragua, and Venezuela (CHNV) parole program). There is also the administration’s effort to eliminate birthright citizenship and the implementation of a registration requirement for non-citizens. While these actions certainly have an impact on the workplace, at least thus far, employment-based immigration policy changes have largely been pushed to the back burner. For example, H-1B “cap season” proceeded without any significant changes, and no travel bans have been implemented.
Zachary V. Zagger and Leah J. Shepherd have a full recap of the first one hundred days of the Trump administration. Be sure to keep an eye open for the Spring Regulatory Agenda, which will provide a forecast of where the administration wants to go on the regulatory front. In his first administration, President Trump’s first Regulatory Agenda was issued on July 17, 2017.
Republican Lawmakers Introduce Joint-Employer Legislation. The legislative proposal to provide employers with a clear joint-employer standard based on direct and immediate control has been on our radar for many years now. The bill is unlikely to clear the sixty-vote legislative filibuster hurdle in the U.S. Senate.
Remaining OSHRC Commissioner Retires. Cynthia Attwood, chair and sole remaining commissioner of the Occupational Safety and Health Review Commission (OSHRC), retired upon the expiration of her term on April 27, 2025. This means that there are no confirmed commissioners at OSHRC, which hears appeals of the workplace safety citations OSHA issues to employers. As the Buzz has discussed, OSHRC has been without a quorum since April 2023. Now, two commissioners will need to be confirmed in order for OSHRC to get up and running. In March 2025, President Trump nominated DOL veteran Jonathan Snare to serve as commissioner.
RIP, Secretary of Labor Herman. Alexis M. Herman, the first African American to serve as U.S. secretary of labor, died on April 25, 2025, at the age of seventy-seven. Herman served as labor secretary from 1997 to 2001 during President Clinton’s second term of office. Prior to her service as secretary of labor, Herman served as the director of the DOL’s Women’s Bureau (at just twenty-nine years old, she was the youngest person to serve in the role) and director of the White House Office of Public Liaison during President Clinton’s first term. As secretary of labor, Herman is remembered, in part, for having played a substantial role in settling a nationwide strike of a package-delivery company.