For HR professionals, compliance is never static. Employment and labor laws shift constantly, and many changes take effect in the second half of the year. With fall approaching, now is the time to review your policies, train your managers and ensure your organization is ready.
Failing to act early can mean more than a missed deadline. It can result in costly penalties, legal exposure and damaged employee trust. This guide outlines the major labor law updates to watch, strategies for adjusting your policies and actionable compliance tips to keep you ahead of the curve.
Top 3 Key Labor Law Updates Coming This Fall
As summer winds down, HR and compliance teams face a new wave of employment law changes that can impact payroll, benefits and workforce policies. From wage increases to expanded leave protections and new worker classification standards, these updates can require swift action to stay compliant.
Below are the top three significant labor law changes taking effect this fall and what your organization should do now to prepare.
1. Wages
- What’s Changing: Florida, Oregon, Alaska and several California cities are raising their minimum wage in the coming months—some by more than $1 per hour. For some jurisdictions, this is part of a multi-year increase plan; for others, it’s a one-time adjustment.
- Why It Matters: In certain industries, minimum wage non-compliance is estimated at a staggering 85%.
Compliance Tip:
- Maintain a real-time, jurisdiction-by-jurisdiction wage chart.
- Configure payroll alerts to flag subminimum payments.
- In multi-jurisdictional contexts, always apply the highest relevant wage.
2. Paid Leave
- What’s Changing: In 2025, Alaska, Missouri and Nebraska will require employers to provide (or allow accrual of) paid sick leave. California is expanding the list of “qualifying acts of violence” for which employees may take paid leave.
- Why It Matters: Even small changes to leave eligibility can trigger updates to your approval processes and recordkeeping requirements.
Compliance Tip:
- Review your leave policies and remove “one-size-fits-all” attendance rules that could conflict with new laws.
- Update your HRIS to track leave accruals automatically and ensure employees can view balances in real time.
- Provide scenario-based training for managers so they know what documentation they can and cannot request.
3 . Employee Classification
- What’s Changing: The U.S. Department of Labor will reinstate the “economic realities” test in 2025 to determine independent contractor status under the Fair Labor Standards Act. Factors include the permanence of the work relationship, the nature and degree of control, required skills, and business initiative.
- Why It Matters: Misclassification can result in large back-pay obligations, unpaid overtime claims, and tax penalties.
Compliance Tip:
- Audit all contractor relationships annually.
- Keep written justifications for each classification decision.
- When in doubt, seek legal review before finalizing contractor agreements.
Three Steps for Fair, Compliant Policy Updates
Updating workplace policies isn’t just a matter of keeping documents current, it’s a legal and ethical responsibility. Clear, compliant policies help prevent misunderstandings, protect employee rights and safeguard your organization from costly disputes. By following a structured approach, HR leaders can ensure every update is fair, transparent and aligned with evolving laws.
1. Audit Your Current Policies
Review pay, leave and classification policies line-by-line. Watch for outdated or overly broad rules, like “no-fault” attendance policies that penalize legally protected absences.
Extra Tip: Document your audit process. A compliance log can help prove good faith if you’re ever investigated.
2. Train Managers and Supervisors
Your leadership team is the front line of compliance. Make sure they understand policy changes, the limits of their authority and the correct approval workflows.
Extra Tip: Use role-play exercises to test decision-making in tricky compliance scenarios.
3. Update Employee Handbooks
Formalize changes in writing and require signed acknowledgment from employees. Update sections on pay and benefits, leave, accommodations and classification.
Extra Tip: Store all handbook versions in a version-controlled archive so you can easily reference past policies if needed.
Proactive Compliance Approach
In HR, change isn’t the exception — it’s the norm. Staying ahead of labor law updates is essential to protecting both your employees and your organization. Make it a habit to monitor announcements from government agencies and reputable HR associations so you can anticipate and prepare for new requirements before they take effect.
Equally important, cultivate strong relationships with trusted legal counsel. Their expertise can help you interpret changes, assess their impact, and adjust policies proactively — reducing the risk of costly missteps.
A practical way to put this into action is by following the 3P Compliance Framework:
- Prepare: Stay ahead of law changes with proactive monitoring and early policy updates.
- Protect: Safeguard your organization through proper training and clear procedures.
- Prove: Document your compliance efforts to demonstrate good faith in any investigation.
When you Prepare early, Protect through training, and Prove with documentation, you transform compliance from a reactive scramble into a strategic advantage.
Simplify Compliance with VirgilHR
VirgilHR’s automated platform makes it effortless to identify which laws apply to your organization and walk you through step-by-step compliance actions. Our intuitive handbook builder ensures clear, user-friendly and legally sound policy documents.
Schedule a demo today to future-proof your policies and minimize compliance risks.
