1. Minimum wages are increasing

In 2023, organizations with employees in multiple states need to keep up with minimum wage changes. The federal minimum wage has remained $7.25 since 2009 and will not be changing. But effective January 1, minimum wage is going up in these states:

• California
• Connecticut
• Delaware
• Florida
• Illinois
• Massachusetts
• Michigan
• Missouri
• Nevada
• New Jersey
• New Mexico
• Rhode Island
• Virginia

A handful of states even passed legislation to reach a $15 minimum wage between 2023 and 2026.

2. Some states require PTO payout

Organizations may know it as PTO, vacation days, sick time, furlough, or PDO. Regardless of its title, there are state laws when it comes to paying out banked time upon termination of employment. Nearly half of U.S. states (24 to be exact) require PTO payout. Stay up to date on PTO payout laws for the states in which your employees reside.

3. Laws vary by state for final paychecks

The past year saw a fair share of resignations, firings, and layoffs. It makes sense amidst the Great Resignation, the “quiet quitting” phenomenon, and rising labor costs. So it’s important to know the legal requirements for final paychecks when an employment relationship ends. Final paycheck laws can vary depending on whether an employee quits or is fired.

4. The five main areas of HR coverage

Human Resources is responsible for five main roles. These include talent management, compensation and employee benefits, training and development, compliance, and workplace safety. There can be a lot of cross-over among the main areas and it can be tough to cover all the moving parts, so ensure each piece is taken care of. At the end of the day, it’s all about managing your company’s most valuable asset: Your employees.

5. Holiday pay policies are typically up to employers

Federal employers are required to provide holiday pay, but is often not mandated in the private sector. Rhode Island and Massachusetts have special laws about holiday pay to keep in mind. Most companies provide holiday benefits to reduce employee turnover and improve morale. Be aware of state-specific rules for the upcoming year.

6. What to do when an employee has COVID-19

While protocol and CDC-guidelines have shifted a lot in the past year, COVID-19 still lingers. There are six steps you can follow when an employee tests positive:

1. Offer support
2. Explain your company’s policy
3. Assess risk and exposure
4. Take action to clean and instruct
5. Inform at-risk employees
6. Inform other employees as necessary

While the proper steps to take may be shifting, they’re still a good reference point for where to start.

7. Drug testing norms are shifting

Marijuana has been legalized for medical and/or recreational use in a number of states. Company drug tests have become a hot topic as marijuana accounts for nearly half of all positive results. So questions remain: Are we limiting talent pools with drug testing policies? Should we stop drug testing? First, we must consider pre-employment drug testing laws which vary by state. Second, there are federal laws that apply to certain positions. Once you review all applicable laws, your organizations can consider whether or not to abandon drug testing altogether.

8. Requirements vary for lunch breaks

Breaks are not required by federal law. And when employees get meal or rest breaks, employers aren’t always required to pay them for that time. The exceptions are as follows:

• State law requires paid breaks
• The employee works through a break time (e.g., if they eat while working)
• It’s a shorter break that lasts 20 minutes or less

If an employee requests an uninterrupted break, you have to provide it. On the other side, you cannot force employees to take breaks. Instead of requiring breaks, create a culture in which breaks are normalized and appreciated.

9. Flexible PTO policies are becoming more common

Traditionally, many employers offered separate paid time off benefits for different scenarios. Sick leave would be differentiated from personal days and paid vacation. Many organizations now offer a more flexible paid time off (PTO) benefit that incorporates all of these. Remote and hybrid work have become increasingly common, which has blurred the line between work and home life. Consider the advantages and disadvantages of offering a flexible PTO policy.

10. Concrete PTO policies should be set

As previously mentioned, laws vary by state regarding PTO payout. Additional questions arise about PTO such as when it should be paid out and how the payout is calculated. For many reasons, it’s crucial to have PTO policies clearly defined. Avoid employee confusion by revisiting your policies and ensuring they are clear and fair.

The last couple of years have been a whirlwind for all employees, but especially for HR. A lot has shifted and will continue to shift for years to come. As long as leaders continue to strive to do what’s best for employees, organizations will find success.