Lynch Dallas, P.C.

LYNCH DALLAS LEGAL UPDATE | DEPARTMENT OF LABOR RULING: A REPRIEVE FOR EMPLOYERS Employers no longer need concern themselves with the January 1, 2025, U.S. Department of Labor (“DOL”) rule raising the salary threshold for overtime compensation. On November 15, 2024, the U.S. District Court for the Eastern District of Texas issued a ruling invalidating and vacating the Dol’s 2024 rules nationwide, in their entirety. The Court found that the agency exceeded its authority under the Fair Labor Standards Act (FLSA). The 2024 rule implemented three changes to the exemptions for executive, administrative, and professional employees’ salary-basis test, which were: 1. An increase in the minimum salary level from $684 per week, or $35,568 annually, to $844 per week, or $43,888 annually, starting on July 1, 2024. 2. A second increase to $1,128 a week, or $58,656 annually, starting on January 1, 2025. 3. An automated mechanism by which the salary minimum would increase every three years based on contemporary earnings data. An estimated 1 million employees were reclassified as non-exempt (or overtime eligible) effective July 1, 2024. As a result, the Dol’s 2024 rule is no longer enforceable (the January 1, 2025 increase will not go into effect and the July 1, 2024 increase is void.) Additionally, the highly compensated executive salary minimum reverts to $2,066 a week (or $107,432 annually). The DOL could appeal, but it seems futile given the upcoming change in administrations. What should employers do? It would be a blow to workplace morale for you to “roll back” any raises already given, but you can reassess whether to change back any employees who had been exempt and were made “non-exempt” due to DOL 2024 rule. This legal update was prepared by Attorneys Amy L. Reasner and Holly A. Corkery.

Are non-compete agreements still valid in Iowa? In May of this year, the Federal Trade Commission issued a rule banning most non-compete agreements in the United States except for senior leadership earning more than $151,000 a year and win policymaker positions, and non-compete agreements in the sale of a business. Non-compete agreements prevent workers from competing with their employer after their employment ends. The agreements are believed to ensure that the employee will not use information learned during employment to start a business to compete with his or her former employer. However, a Texas federal court issued a permanent preliminary injunction in August 2024, blocking the rule from taking effect in certain cases, arguing that the FTC may have overstepped its authority in creating this rule. Read full article here: https://lnkd.in/gSEB5yjN

The Law: 32- or 48-hour workweeks? 1938 law set the standard at 40 hours, but that could change. Greece recently passed a law that went into effect July 1 allowing some companies to enforce a six-day work week, or 48 hours per week. Workers can choose between working an extra two hours a day or another full eight-hour day. The extra day apparently will address urgent operational demands, given the current supply of workers in that country. The Greek law apparently requires employers to pay an additional 40 percent on all hours over 40 per week, which rises to 150 percent if that date falls on a Sunday or a public holiday. Read full article here: https://lnkd.in/gQEAqj2d

Madison P. Huntzinger has joined the Lynch Dallas, P.C. law firm in Cedar Rapids as an Associate Attorney. Ms. Huntzinger received her J.D. from the University of Iowa College of Law in 2024. Ms. Huntzinger’s practice will focus on employment law (both public and private sector), municipal law, and insurance defense. 

Today, we honor the incredible Human Resources professionals who play a vital role in shaping our workplaces, including the many that Lynch Dallas, P.C. attorneys are lucky to work with every day. Your dedication to fostering a positive culture, supporting employee growth, and driving organizational success is truly commendable. Thank you for being the bridge between leadership and employees, for championing diversity and inclusion, and for your unwavering commitment to creating a supportive environment where everyone can thrive. Your efforts do not go unnoticed! Let’s take a moment to appreciate the hard work, empathy, and innovation that Human Resources professionals bring to the table every day. Happy Human Resources Professionals Day—here’s to you! 

Lynch Dallas Attorneys Samantha Kuntz and Maddie Huntzinger are getting groovy at the Iowa League of Cities Conference! Stop by the Lynch Dallas booth to meet our Attorneys!

The Law: What about politics in the workplace? The November general election is rapidly approaching, and discussion of political issues is beginning to intensify. Since any workplace is a community in which its members hold a variety of political views, free speech and tolerance will certainly be tested. Occasionally office political discussions erupt into heated arguments, which can impact productivity, employee morale and working relationships. Read full article here: https://lnkd.in/ghrk-2mP

LYNCH DALLAS LEGAL UPDATE | NATIONWIDE INJUNCTION ALLOWS NON-COMPETE AGREEMENTS Earlier this year, the Federal Trade Commission (FTC) announced a rule banning employers from using non-compete agreements. The rule was set to be implemented on September 4, 2024. However, on August 20, a federal court in Texas placed a nationwide injunction prohibiting the FTC from enforcing its non-compete ban. The judge found that the FTC acted outside of its authority in creating such a ban and that the ban itself was too broad for enforcement. For more details about the case, you can read the opinion here: https://lnkd.in/dDwhJ8_K. Because the injunction is in place nationwide, employers may continue the use of non-compete agreements as allowed under state law. We do, however, anticipate that the Texas decision will be appealed, and the outcome of that appeal is uncertain. Because the injunction could be lifted, we recommend that employers using noncompete agreements start gathering data on which employees have such agreements. If the injunction is lifted, employers must: 1. Stop including non-competes in future employment contracts, paperwork, or websites; 2. Give notice to current and former employees that their non-compete agreements are unenforceable; and 3. Stop enforcing non-competes going forward for employees other than for senior executives. The FTC has provided model language for providing notice, which you can access here: https://lnkd.in/dBAvvBFF. We will continue to monitor the FTC’s non-compete ban issue and will provide updates as the challenges in court continue. Employers with questions about the nationwide injunction should speak with their employment and labor attorneys. This legal update was prepared by Attorneys Amy L. Reasner and Holly A. Corkery.

LYNCH DALLAS LEGAL UPDATE | NEW GUIDANCE ON THE PREGNANT WORKERS FAIRNESS ACT The Pregnant Workers Fairness Act (PWFA) requires employers of 15 employees or more to provide reasonable accommodations to employees or applicants with known limitations that arise from childbirth unless the accommodations create undue hardship for the employer. The Equal Employment Opportunities Commission (EEOC) has now published its guidance on how the PWFA will be implemented. The final rule became effective on June 18, 2024. Under the new regulation, reasonable accommodations are “modifications or adjustments” to the application process or to the work environment that allows the employee to perform the essential functions—meaning duties that are fundamental to their employment— of their position, enjoy equal benefits and privileges of employment enjoyed by other employees who do not require an accommodation, or temporary suspension of the essential functions of their job. Examples of reasonable accommodations include: ▪️ Making existing facilities readily accessible to and usable by employees who need accommodations; ▪️ Restructuring the job, such as changes to work schedules, reassignment to vacant positions, providing a reserved parking space, modifying uniforms, providing seating, and more; ▪️ Placing the employee on leave, including paid or unpaid but only if no other reasonable accommodation may be made or the employee elects such option; ▪️ Breaks and other accommodations for lactation, such as proving a space for such activity. Under the new regulation, undue hardship means “significant difficulty or expense incurred by a covered entity” when considered with several factors. These factors include the nature and cost of the accommodation needed; the characteristics of the employer, including its type of operation, overall financial resources, number of employees, and the effect of the accommodation on expenses and resources; and the impact of the accommodation on the operation of the entity. An important note, an employer may only request documentation of the employee’s limitation under limited circumstances when it is reasonable to determine whether the employee has a limitation and needs an accommodation…meaning only when an employer needs to confirm the limitation, confirm the limitation is related to childbirth, and describe the adjustments needed at work. Employers who do not comply with the new guidance may be subject to complaints to the Iowa Civil Rights Commission or EEOC, and ultimately, lawsuits. This legal update was prepared by Attorneys Amy L. Reasner and Holly A. Corkery.

The Law: Be careful about internal transfers at work In an April 2024 U.S. Supreme Court case, a St. Louis police sergeant alleged that she was transferred from one job to a less desirable job in the police department because of her sex. Read full article here: https://lnkd.in/gxjzgqcz