APPLIES TO All Employers

EFFECTIVE As Indicated

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The injunction barring the Trump Administration from enforcing certain executive actions has been lifted. A new national temporary restraining order was issued against the Certification Provision of Executive Order 14173, but only for DOL grant recipients. Two new technical assistance documents from the DOJ and the EEOC outline what may constitute unlawful discrimination based on DEI-related workplace practices.

Discussion:

Injunction on Executive Orders is Lifted, While Another TRO Gets Issued

 

On March 14, 2025, in National Association of Diversity Officers in Higher Education v. Trump, the U.S. Court of Appeals for the Fourth Circuit stayed enforcement of the preliminary injunction that was issued by a Maryland district court judge, initially barring the Trump administration from proceeding with several elements of Trump’s executive orders regarding DEI (Nos. 14151, 14173). As a result of this ruling, the injunction on President Trump’s executive orders targeting DEI was lifted and such initiatives may move forward. In making its ruling, the Fourth Circuit noted that while the Executive Orders are not unconstitutional on their face, actions taken by federal administrative agencies may prove to be unconstitutional. As a result, the district court case against the executive orders will continue without an injunction on enforcement.

 

In a further twist, on March 27, 2025, a federal district court in Illinois imposed a limited temporary restraining order (TRO) against the Termination and Certification Provisions of those same executive orders. Specifically, the Certification Provision TRO applies nationwide to those who are Department of Labor grant recipients; the Termination Provision TRO applies only to enforcement by the Department of Labor against the plaintiff and any federal grantee through which the plaintiff holds a subcontract or is a subrecipient of federal funds.

 

With the Fourth Circuit injunction lifted, employers should expect increased federal investigations and compliance reviews of DEI programs, especially those in federal agencies and businesses with government contracts. However, the subsequent district court ruling sets an example of how other organizations may challenge the executive orders going forward.

 

Administrative Guidance Issued for “Unlawful DEI-Related Discrimination”

 

On March 19, 2025, the Equal Employment Opportunity Commission (EEOC) and the U.S. Department of Justice (DOJ) released two technical assistance documents focused on educating the public about unlawful discrimination related to DEI in the workplace. The first jointly-published document, titled “What To Do If You Experience Discrimination Related to DEI at Work,” provides a one-page overview of what DEI-related discrimination may look like. The second document, titled “What You Should Know About DEI-Related Discrimination at Work,” provides expanded guidance from the EEOC in a question-and-answer format on whether certain DEI-related practices may be considered unlawful under Title VII.

 

Tasked with enforcing Title VII of the Civil Rights Act, the EEOC acknowledges that Title VII does not define DEI. Title VII prohibits employment discrimination based on protected characteristics such as race and sex, and the EEOC opines that DEI initiatives, policies, programs, or practices may be unlawful if they involve an employer or other covered entity taking an employment action motivated—in whole or in part—by an employee’s or applicant’s race, sex, or another protected characteristic. This may include, but is not limited to, enforcing job quotas or workforce balancing based on protected characteristics.

 

Additionally, employers may run afoul of Title VII’s protections if they limit, segregate, or classify employees based on a protected classification. This could look like limiting membership in workplace groups, such as Employee Resource Groups (ERG) or other employee affinity groups, to certain protected groups or separating employees into groups based on a protected characteristic when administering DEI or other trainings, or other privileges of employment, even if the separate groups receive the same programming content or amount of employer resources. Employers should also be aware that an employee’s reasonable opposition to a DEI training program may constitute protected activity that could support a claim of retaliation.

 

The new guidance confirms that employees who feel they have been subjected to unlawful DEI-related discrimination must file a complaint with the EEOC, before pursuing a federal claim under Title VII.

 

Action Items

1. Review workplace DEI practices for compliance with Title VII.
2. Consult with legal counsel when developing or modifying new or existing DEI programs.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 ManagEase

APPLIES TO All Employers

EFFECTIVE As Indicated

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look There is a new Form I-9 edition, dated 01/20/25 with an expiration date of 05/31/27. Employers should be aware of changes in Section 1, revised descriptions within the Lists of Acceptable Documents, and updated instructions. E-Verify has also been updated to reflect statutory language and requires new web services compliance requirements for employers.

Discussion:

The U.S. Citizenship and Immigration Services (USCIS) made minor changes to Form I-9 and updates to the E-Verify system to reflect recent policy changes from the current Administration. The revised Form I-9 has an edition date of January 20, 2025, and an expiration date of May 31, 2027. The two prior editions of Form I-9 will remain valid until their respective expiration dates of July 31, 2026 and May 31, 2027. Employers using the form expiring July 31, 2026 must update their electronic systems by that date to use the form with the May 31, 2027 expiration date.

 

In addition, USCIS has made several changes to Form I-9, notably renaming the fourth checkbox in Section 1 to “An alien authorized to work” and revising descriptions of two List B documents in the List of Acceptable Documents (Driver’s license or ID card) by removing the word “gender” and replacing it with the word “sex.” The form instructions have also been updated to reflect statutory language and a revised DHS Privacy Notice has been added.

 

The E-Verify system has similarly been updated to replace “A noncitizen authorized to work” with “An alien authorized to work” during case creation. Employers must make sure to select the appropriate designation when creating a new case in E-Verify if using a valid Form I-9 with outdated terminology. USCIS has indicated that when an employer creates a new case in E-Verify, the system may automatically update to the outdated terminology (e.g., “A noncitizen authorized to work”), so employers may need to update their web service platforms to transmit the correct terminology when a new case is submitted.

 

Action Items

1. Ensure use of a valid Form I-9 until their respective expiration dates.
2. Have appropriate personnel trained on updated terminology and procedural changes.
3. Provide employees with updated form instructions and Lists of Acceptable Documents during onboarding.
4. Ensure compliance with new web service requirements, if using E-Verify system.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 ManagEase

APPLIES TO All Employers with Covered Federal Contracts

EFFECTIVE March 14, 2025

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look The rule requiring federal contractor minimum wage to be $17.75/hr. has been rescinded. The previous Executive Order now in effect requires a $13.30/hr. minimum wage. Despite this change, higher wage rates may still apply.

Discussion:

President Trump recently issued an order rescinding Executive Order 14026 which had most recently increased the minimum wage for federal contractors to $17.75 per hour on January 1, 2025. President Biden’s 2022 Executive Order 14026 superseded President Obama’s 2014 Executive Order 13658 at the time. With Executive Order 14026 rescinded, the minimum wage rule currently falls to Executive Order 13658. This means that the federal contractor minimum wage is currently $13.30 per hour ($9.30 for covered tipped employees) for applicable federal contracts.

 

For employers who already increased minimum wages to $17.75 per hour at the beginning of the year, those rates may still be maintained; a decease in wage rates is not required. For those looking to make an adjustment, wage rates may be decreased on a prospective or going-forward basis, not on a retroactive basis for wages already earned. Keep in mind that some states and localities have minimum wage requirements higher than the currently applicable federal contractor minimum. Additionally, federal contracts may also still be covered by prevailing wage laws with higher requirements. Employers should review federal contracts with legal counsel to determine the impact of this change.

 

Action Items

1. Review federal contracts to determine applicable minimum wage requirement.
2. Evaluate whether wage rate adjustments are appropriate on a prospective basis.

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 ManagEase

APPLIES TO All Employers with Employees in CT, NY, and VT

EFFECTIVE March 13, 2025

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look In Giordano v. Saks & Co. LLC, the Second Circuit Court of Appeals dismissed a class action lawsuit brought by luxury retail employees alleging an unfair restraint on competition caused by the defendant luxury brands entering into no-hire agreements. The court said the plaintiffs had not plausibly alleged harm to the luxury retail employees due to the no-hire agreements.

Discussion:

In Giordano v. Saks & Co. LLC, the Second Circuit Court of Appeals dismissed a class action lawsuit brought by luxury retail employees alleging an unfair restraint on competition caused by the defendant luxury brands entering into no-hire agreements. The court ruled the plaintiffs had not plausibly alleged harm to the luxury retail employees due to the no-hire agreements. Here, several former Saks Fifth Avenue employees alleged the retailer conspired with luxury brands to control the wages and certain job conditions of their employees. Specifically, the plaintiff employees claimed the American subsidiaries of Louis Vuitton, Fendi, Loro Piana, Gucci, Prada, and Brunello Cucinelli entered into a no-poaching agreement with Saks not to hire any Saks luxury retail employees without Saks’ approval or before the passing of six months after the separation of the employee from Saks.

 

The plaintiffs alleged the no-poaching agreements violated Section 1 of the Sherman Act. The Sherman Act is primarily an antitrust law and prohibits agreements or conspiracies that unreasonably restrain trade. The plaintiffs argued the no-poaching agreements unreasonably restrained trade by suppressing wages and limiting the professional mobility of luxury retail employees in an alleged nationwide market.

 

The court upheld the United States District Court for the Eastern District of New York’s dismissal of the case. The court agreed with the district court that the plaintiffs failed to state an antitrust claim. Since the no-hire agreements were primarily vertical, between a retailer and brands that supply merchandise, and not horizonal restraints, the claims must be analyzed under the rule of reason. The plaintiffs were unable to demonstrate that alleged anticompetitive conduct has an adverse effect on competition in the relevant market. The court found that the employees were also unable to show that the no-hire agreements depressed wages and limited worker mobility in either the nationwide market of luxury retail employees or all Saks employees.

 

Although this case was dismissed, employers should review any proposed restraints on employees and their mobility in the labor market with legal counsel.

 

Action Items

1. Consult with legal counsel prior to entering into no-hire agreements with suppliers or competitors.

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 ManagEase

APPLIES TO All Employers with Employees in CA

EFFECTIVE February 26, 2025

QUESTIONS? Contact HR On-Call (888) 378-2456

Quick Look When a representative claim rather than an individual PAGA claim is made in a lawsuit, a court cannot insert an individual claim in order to enforce an arbitration agreement that only covers individual claims.

Discussion:

The California Private Attorney General Act (PAGA) continues to be at the center of wage and hour lawsuits. As recently reported, on December 30, 2024, in Leeper v. Shipt, Inc., the California Court of Appeal, District Two, said that PAGA actions necessarily include an individual component. The court said that the employee’s individual PAGA claim must be ordered to arbitration and the litigation is stayed pending arbitration.

 

More recently, on February 26, 2025, in Rodriguez v. Packers Sanitation Services LTD., LLC, the California Court of Appeal, District Four, disagreed with the ruling in Leeper which said that “any PAGA action” “necessarily includes . . . an individual PAGA claim.” Rather, this court said that even though an individual PAGA claim may be a necessary component of a PAGA action, it does not automatically mean that an individual claim exists where none was alleged.

 

Here, the plaintiff brought wage and hour claims acting “in a Representative Capacity only” and the defendant employer sought to enforce arbitration of the plaintiff’s individual claims, which were intentionally not asserted in the Complaint. The court said that because the plaintiff is not asserting individual PAGA claims, and the arbitration agreement does not cover representative actions, the trial court could not have compelled individual PAGA claims to arbitration. The court said the focus should be on the interpretation of the arbitration agreement and what a plaintiff has alleged in a Complaint. The court should not be inserting claims into the Complaint that do not exist. The burden is on the plaintiff to properly allege claims against a defendant.

 

The court specifically does not address whether it is permissible for a plaintiff to file a complaint that asserts only non-individual PAGA claims because it wasn’t brought up on appeal. “[T]his is an appeal from an order resolving a motion to compel arbitration, not a motion challenging the sufficiency of the complaint.” Because of the split in authority, these issues will likely end up before the California Supreme Court. Employers should continue to look for updates on PAGA and arbitration enforcement.

 

Action Items

1. Review arbitration agreements with legal counsel.

 

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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 ManagEase