Employers may soon see a shift in federal guidance on voluntary affirmative action programs.  On May 27, 2026, the Equal Employment Opportunity Commission (EEOC) submitted a proposal to rescind its 1979 interpretive guidance on voluntary affirmative action under Title VII of the Civil Rights Act. The existing guidance, found at 29 C.F.R. Part 1608, explains when employers may voluntarily adopt affirmative action measures to address workforce imbalances or barriers to equal employment opportunity.

The current guidance also provides a framework for when employers may rely on the EEOC’s interpretation as a defense in certain Title VII matters, including where the employer acted in good faith and in reliance on the agency’s written guidance.

What This Means

The EEOC’s proposal does not immediately change the law. OIRA review is only one step in the regulatory process, and the EEOC would need to take further action before any rescission becomes effective.

The proposal also does not amend Title VII or overturn U.S. Supreme Court decisions recognizing that voluntary affirmative action plans may be permissible in limited circumstances. However, it signals that federal agencies are continuing to reassess employment programs that consider race, sex, or other protected characteristics.

This development follows broader federal scrutiny of diversity, equity, and inclusion initiatives, affirmative action programs, and other employment practices tied to protected characteristics.

Why Employers Should Pay Attention

If the EEOC ultimately rescinds the guidance, employers may have less agency guidance to rely on when evaluating or defending voluntary affirmative action plans. The change could also affect how the EEOC reviews these programs in future enforcement matters.

Employers should be especially cautious with programs that involve hiring goals, representation targets, preferences, set-asides, or other practices that reference protected characteristics.

Forework Takeaway

Employers with voluntary affirmative action plans, DEI initiatives, representation-focused programs, or hiring practices tied to protected characteristics should:

• Review whether the program is legally required or voluntary.

• Confirm the business and legal basis for the program.

• Avoid rigid quotas, preferences, or set-asides.

• Ensure employment decisions remain individualized and merit-based.

• Monitor further EEOC action before assuming the guidance has been rescinded.

Employers with operations in Philadelphia should be aware of a recent development under the city’s Fair Criminal Record Screening Standards Ordinance (FCRSSO), commonly known as Philadelphia’s “ban-the-box” law.

Earlier this year, significant amendments to the FCRSSO took effect, expanding employer obligations regarding the use of criminal history information in employment decisions. While the amendments gave the Philadelphia Commission on Human Relations discretion to issue an updated “Summary of Rights” notice, it was unclear whether the Commission would do so.

The Commission has now published an updated Summary of Rights notice for applicants and employees.

Why This Matters

Under the FCRSSO, employers must provide applicants and employees with a summary of their rights before taking adverse employment action based on criminal history information. With the release of the updated notice, employers should strongly consider using the newly issued version to satisfy this requirement.

Additionally, Philadelphia employers are required to post a Commission-approved summary of the law in a conspicuous location on both their premises and websites. Employers should review existing postings and replace older versions with the newly issued notice.

Potential Confusion Remains

The Commission’s website currently contains multiple versions of FCRSSO notices and posters, including older versions from 2021 and 2024. Some of these materials contain language that may no longer align with the amended ordinance, creating potential confusion for employers attempting to comply with the law.

Until further clarification is provided by the Commission, the most conservative compliance approach is to utilize the newly published notice for both adverse action communications and required workplace postings.

Forework Takeaway

Philadelphia continues to aggressively regulate the use of criminal background information in hiring and employment decisions. Employers should:

• Review current Philadelphia fair chance hiring procedures.
• Replace outdated FCRSSO posters and notices.
• Ensure recruiting, HR, and management teams are using the updated forms.
• Confirm that adverse action workflows include the required notice before final employment decisions are made.

As jurisdictions continue expanding fair chance hiring protections, employers should regularly review their hiring processes to ensure compliance with evolving local requirements.

The U.S. Department of Labor (DOL) has officially removed the now-invalidated 2024 federal overtime rule and restored the Fair Labor Standards Act (FLSA) exemption regulations to their prior form.

The 2024 rule would have significantly increased the minimum salary required for employees to qualify for the executive, administrative, and professional (EAP) exemptions. The rule was scheduled to raise the salary threshold from $684 per week to $844 per week in July 2024 and then to $1,128 per week in January 2025, with automatic increases every three years thereafter. It also would have substantially increased the compensation requirement for the Highly Compensated Employee (HCE) exemption.

However, a federal court in Texas struck down the rule in November 2024, finding that the DOL exceeded its authority by placing too much emphasis on salary levels rather than an employee’s job duties when determining exempt status.

The DOL’s latest action simply removes the invalidated rule from the federal regulations and formally reinstates the standards established under the 2019 rule.

What Employers Need to Know

For now, the federal salary thresholds remain:

• $684 per week for most executive, administrative, and professional exempt employees

• $107,432 annually for the Highly Compensated Employee (HCE) exemption

Employers should remember that meeting the salary threshold alone does not create an exemption. Employees must also satisfy the applicable duties tests under federal law.

Forework Takeaway

While the federal exemption salary threshold remains unchanged, employers must take into account State-specific salary thresholds, including New York and California, which impose higher salary requirements and additional exemption standards under State law.  And, those levels are not stagnant. 

Now is a good time to review employee classifications, confirm compliance with applicable state requirements, and ensure exempt employees satisfy both the salary and duties tests.

The City of Chicago has issued updated regulations interpreting its Paid Leave and Paid Sick and Safe Leave Ordinance, providing employers with important guidance on paid leave  administration, employee discipline, joint employment, and business transitions. The revised rules took effect on June 1, 2026, and clarify several areas that have created compliance challenges for employers since the ordinance was enacted.

Combined PTO Policies Remain Permitted

One of the most significant clarifications confirms that employers may maintain a single paid time off (PTO) bank instead of separate Paid Leave and Paid Sick Leave banks. However, employers should proceed carefully. To comply, a combined PTO policy must satisfy all requirements of the ordinance, including accrual, carryover, usage, and recordkeeping obligations. Simply offering a generous PTO policy does not automatically satisfy Chicago’s requirements.

Expanded Definition of Childcare Closures

The updated rules clarify that employees may use Paid Sick Leave when a child’s “place of care” unexpectedly closes. Importantly, the definition of “place of care” extends beyond schools and daycare facilities and may include informal caregiving arrangements, such as babysitters or family members who regularly provide childcare.

Employers May Discipline Abuse of Sick Leave

The revised regulations confirm that employers may discipline employees who misuse Paid Sick Leave, including in appropriate cases terminating employment.

Examples of potential abuse include repeated patterns of using sick leave:

• Adjacent to weekends, holidays, or vacation periods.

• After a request for another type of leave was denied.

• To avoid undesirable work assignments.

Employers should exercise caution before taking disciplinary action and ensure decisions are supported by documented facts rather than assumptions.

Joint Employers Share Responsibility

The updated rules make clear that joint employers are both individually and jointly responsible for compliance with Chicago’s paid leave requirements. This clarification is particularly important for employers that utilize staffing agencies, professional employer organizations (PEOs), or other workforce-sharing arrangements. Businesses should review these relationships to ensure responsibilities are clearly understood and documented.

Business Sales and Acquisitions Create Additional Obligations

The regulations also address mergers, acquisitions, and business transfers. When employees move to a successor employer as part of a transaction, accrued and unused Paid Leave and Paid Sick Leave generally must transfer with the employee. Both the seller and purchaser may face liability if these obligations are not properly addressed during the transaction process.

Forework Takeaway

Chicago continues to maintain some of the most complex paid leave requirements in the country. Employers should not assume their existing PTO policies automatically comply with the ordinance and they should proactively audit their written policies and actual procedures to confirm that they are in compliance.  

Connecticut has joined the growing list of states regulating the use of artificial intelligence in the workplace. On May 27, 2026, Governor Ned Lamont signed the Connecticut Artificial Intelligence Responsibility and Transparency Act (SB 5) into law. The legislation creates new compliance requirements for employers that use AI-driven tools to assist with hiring, promotions, performance evaluations, compensation decisions, layoffs, or other employment-related decisions. While most of the law does not take effect until October 2027, employers should begin preparing now.

What Is Covered?

The law applies to employers that use Automated Employment-Related Decision Technology (AEDT)—a broad category that includes AI tools that generate recommendations, rankings, scores, classifications, or other outputs that materially influence employment decisions.

Importantly, the law focuses on how AI is used, not what a vendor calls the product. Even tools marketed as “assistive” or “analytics” platforms may fall within the law if they significantly influence employment decisions.

New Notice Requirements

Beginning October 1, 2027, employers using covered AI tools must provide notice to Connecticut employees and job applicants when AI is being used as a substantial factor in an employment decision.

The notice must disclose:

• That AI technology is being used.

• The purpose of the technology.

• The employment decision being evaluated.

• The categories of personal data being analyzed.

• The source of that data.

• Contact information for the employer.

Failure to comply may result in enforcement by the Connecticut Attorney General under the state’s unfair trade practices laws.

AI Is Not a Defense to Discrimination Claims

Beginning October 1, 2026, Connecticut law will expressly provide that employers cannot avoid liability for discrimination by claiming that an AI system made the decision.

In other words, if an AI-driven hiring, promotion, compensation, or termination decision produces a discriminatory result, the employer remains responsible.

The law does, however, encourage employers to conduct bias testing and other proactive reviews of AI systems. Courts and regulators may consider evidence of anti-bias testing when evaluating discrimination claims.

Additional WARN Act Reporting

Connecticut employers issuing WARN notices for mass layoffs will also be required to disclose whether the workforce reduction was related to the use of artificial intelligence or other technological changes.

Forework Takeaway

Employers should begin inventorying all workplace AI tools and determine:

• What decisions the technology influences.

• What employee or applicant data is being analyzed.

• Whether AI-generated recommendations affect hiring, promotion, discipline, compensation, or termination decisions.

• Whether vendors can provide documentation regarding bias testing and compliance support.

As more states enact AI regulations, employers should expect increasing scrutiny of workplace technology. Organizations that understand their AI tools, document their decision-making processes, and conduct regular compliance reviews will be in the strongest position to navigate this rapidly evolving area of employment law.

The U.S. Department of Labor (DOL) recently issued guidance that gives employers more flexibility when designing bonus programs for nonexempt employees. In Opinion Letter FLSA2026-6, the DOL endorsed a bonus structure that allows employers to establish a bonus pool after a performance period has ended while still avoiding the complex overtime recalculations that often accompany nondiscretionary bonuses. For employers seeking to reward employees while maintaining greater control over labor costs, the guidance provides a potentially valuable compliance tool.

Why Bonus Programs Create Overtime Challenges

Under the Fair Labor Standards Act (FLSA), most nondiscretionary bonuses must be included in an employee’s regular rate of pay when calculating overtime. As a result, employers frequently must recalculate overtime earnings and pay additional overtime amounts after bonuses are awarded—a process that can be administratively burdensome, especially when bonuses are earned over several months or an entire year. 

Historically, employers could avoid these additional calculations by paying a bonus as a percentage of an employee’s total earnings, including overtime earnings. Because the bonus automatically increased along with overtime pay, the overtime component was considered already included.

The downside? Employers often could not predict the total cost of the program until the performance period ended.

The New Bonus Pool Approach

The DOL has now confirmed that employers may establish a total bonus pool after the performance period concludes and distribute the funds proportionally based on each employee’s share of total earnings.  For example, if an employer establishes a $100,000 bonus pool and an employee earned 5% of the total earnings of all eligible participants during the performance period, that employee would receive 5% of the bonus pool.

This approach allows employers to determine the total amount they wish to spend on bonuses after reviewing financial results, rather than committing to an unknown payout amount in advance.

What Employers Need to Know

The DOL emphasized that employers cannot use this structure to avoid overtime obligations. To remain compliant:

• Bonus calculations must be genuinely tied to employee earnings.
• Employers cannot simply assign fixed bonus amounts and retroactively label them as percentage-based bonuses.
• Certain payments that are excluded from the regular rate of pay, such as discretionary bonuses and expense reimbursements, generally cannot be included when calculating bonus percentages.
• Bonus plans should be carefully structured and documented before implementation.

Forework Takeaway

This guidance provides employers with a valuable opportunity to balance employee incentives with budget certainty. However, bonus structures involving nonexempt employees remain one of the most common areas for wage-and-hour mistakes. Employers should review existing bonus programs to ensure they comply with both federal and state overtime requirements before implementing any new compensation strategy.

Virginia has joined the growing list of states requiring employers to provide paid sick leave to employees.  While the law’s implementation will be phased in over several years based on employer size, businesses should not wait until the last minute to prepare. Paid leave laws often require significant updates to payroll systems, employee handbooks, leave policies, recordkeeping procedures, and manager training.  For employers with operations in Virginia, now is the time to evaluate whether existing leave programs are equipped to meet the new requirements.

Who Will Be Affected?

Virginia’s new paid sick leave law will eventually apply to nearly all employers in the Commonwealth.  The rollout schedule is based on employer size:

• Employers with 50 or more employees must comply beginning July 1, 2027
• Employers with 25 or more employees must comply beginning January 1, 2028
• Employers with at least one employee must comply beginning January 1, 2029

Although these deadlines may seem distant, employers that operate in multiple states should begin assessing how Virginia’s requirements fit within their broader leave administration strategy.

How Sick Leave Will Accrue

Under the new law, employees will earn:

One hour of paid sick leave for every 30 hours worked

Employees may accrue and use up to 40 hours annually unless an employer chooses to provide a more generous benefit.

Employers may also choose a front-loading approach by providing the full annual allotment at the beginning of the year rather than tracking accruals throughout the year.  For many organizations, this decision will come down to administrative efficiency, payroll capabilities, and workforce demographics.

Existing PTO Policies May Already Help

The good news for many employers is that the law does not necessarily require creating a separate sick leave bank.  Organizations that already provide paid time off (PTO) may satisfy the law if their existing policy:

• Provides sufficient leave
• Allows leave to be used for the same qualifying reasons
• Meets the law’s operational requirements

This makes policy review particularly important before investing in new leave structures.

Payroll and HR Systems Will Need Attention

One of the biggest compliance challenges will be accurate leave tracking.  Employers must account for:

• Accruals
• Carryover rules
• Rehires
• Employee transfers
• Successor employer obligations
• Leave usage tracking

Employees rehired within 12 months must have previously accrued unused leave reinstated, creating additional administrative complexity.  Organizations relying on manual tracking methods may find compliance increasingly difficult as leave requirements continue expanding nationwide.

The Definition of “Family Member” Is Broad

Like many modern paid leave laws, Virginia’s definition of family member extends well beyond traditional immediate family relationships. The law covers a wide range of caregiving situations and recognizes that employees often provide care for individuals outside traditional family structures.  For employers, this means managers should avoid making assumptions about whether a leave request qualifies.

Documentation Rules Are Employee-Friendly

The law limits the circumstances under which employers can require documentation. Generally, documentation may only be requested after an employee has used three or more consecutive workdays of leave.  Even then, employers face restrictions on the information they may request and must protect the confidentiality of any medical or sensitive personal information they receive. Organizations should review existing attendance and documentation policies to ensure they align with these requirements.

New Notice and Recordkeeping Obligations

Employers will also be required to:

• Provide written notice of employee rights
• Post notices in the workplace
• Maintain records of leave accrual and usage
• Retain records for at least three years

Recordkeeping requirements continue to be a growing area of regulatory focus across employment laws, making documentation systems more important than ever.

Why Multi-State Employers Should Pay Attention

Across the country, states and local jurisdictions continue expanding employee leave rights, often with different accrual formulas, usage requirements, notice rules, and recordkeeping obligations.

As these laws multiply, compliance becomes increasingly difficult for employers attempting to manage leave manually or through disconnected systems.  What works in one state may not satisfy requirements in another.

Questions Employers Should Be Asking Now

Before the law takes effect, employers should evaluate:

• Whether current PTO policies satisfy the new requirements
• How leave accruals are currently tracked
• Whether payroll systems can manage carryovers and reinstatements
• How leave records are maintained
• Whether managers understand leave-related protections
• How employee notices will be distributed and tracked

The employers that begin planning early will face a far smoother implementation process.

Forework’s Perspective

Forework has extensive experience assisting employers with State and City-based paid sick leave requirements. Our payroll is configured to meet these requirements from day 1 of the law’s implementation, and we our employment attorneys work with clients to prepare the initial and ongoing written policy requirements for companies that have local or state-specific paid sick leave obligations.  

Employers operating in Chicago face a new round of scheduling compliance requirements beginning June 1, 2026.

The City of Chicago recently adopted significant amendments to its Fair Workweek regulations, expanding employer obligations related to scheduling, employee consent, predictability pay, recordkeeping, and workforce communication.  In this alert, we break down the amendments and implications for covered employers.  

Why This Matters

Fair Workweek laws are designed to provide employees with greater schedule stability and predictability. While these requirements have existed in Chicago since 2020, the new rules provide additional guidance and create more detailed compliance expectations for employers. The biggest takeaway is that employers must now maintain stronger documentation and exercise greater control over scheduling changes.

Covered Employers Should Pay Attention

The ordinance generally applies to employers in industries such as Healthcare, Retail, Restaurants, Hospitality, Manufacturing, Warehouse operations, and Building services.  Coverage is determined using global employee headcount rather than local staffing levels.  For larger employers with hourly workforces, these rules can affect scheduling procedures, payroll calculations, employee communications, and record retention practices.

Scheduling Changes Just Became More Expensive

One of the most important changes involves Predictability Pay. Under the revised rules, employers may owe additional compensation whenever they make certain schedule changes after a schedule has been posted. Even relatively small changes can trigger compliance obligations. 

The city also clarified that employee consent must be written, time-stamped, and specific to the schedule change.  General blanket consent forms will not satisfy the requirement.  For employers, this means informal scheduling practices that once seemed harmless could now create compliance risk.

Documentation Is Becoming Critical

The new rules place significant emphasis on recordkeeping. Employers must be able to demonstrate compliance with requirements involving:

• Schedule postings
• Employee consent
• Predictability Pay
• Right-to-Rest provisions
• Schedule modifications

If documentation does not exist, employers may struggle to prove compliance during an audit or investigation.

Organizations relying on manual scheduling methods, text messages, spreadsheets, or inconsistent manager practices may want to evaluate whether their current processes provide sufficient documentation.

Advance Scheduling Requirements Are More Detailed

Employers must continue providing schedules at least 14 days in advance, but the city has added additional requirements regarding how schedules are prepared and maintained.  Schedules must now contain more detailed information and be properly documented.  The city also clarified expectations regarding on-call shifts, which must be included when providing schedule estimates. For employers that rely heavily on fluctuating staffing levels, these requirements may require more sophisticated workforce planning.

Right-to-Rest Rules Require Additional Attention

Chicago’s Fair Workweek Ordinance continues to provide employees with the right to decline shifts that begin less than ten hours after a prior shift.  Employees may voluntarily agree to work those shifts, but the consent must be properly documented.  When such shifts are worked, employers generally must provide premium compensation.  This is an area where scheduling and payroll systems must work together to ensure compliance.

Payroll Teams May Feel the Impact

Many employers think of Fair Workweek laws as an HR or operations issue.  In reality, payroll departments often bear the burden of ensuring compliance.  The updated rules require employers to:

• Track Predictability Pay
• Apply premium pay when required
• Maintain supporting documentation
• Properly reflect certain payments on wage statements

As scheduling laws become more complex, payroll accuracy becomes increasingly important.

Questions Employers Should Be Asking

Organizations operating in Chicago should evaluate:

• How scheduling changes are currently documented
• Whether employee consent is properly recorded
• How Predictability Pay is calculated
• Whether managers understand scheduling restrictions
• Whether payroll systems can accurately track required premium payments
• Whether scheduling and payroll data are integrated

These questions become especially important for employers with multiple locations or decentralized management structures.

Forework’s Perspective

Covered employers must review these amendments and audit their payroll and HR practices to ensure that they are in compliance with these requirements.  Forework works with Chicago employers to assist them in determining coverage, scope of their obligations, and implementation of the law’s requirements.  

Many employers use employment agreements that attempt to shorten the amount of time employees have to bring legal claims against the company. A recent federal appeals court decision serves as an important reminder that these provisions may not always be enforceable.

In a ruling that could influence employment practices across the country, the U.S. Court of Appeals for the Fourth Circuit held that employers cannot use pre-employment agreements to shorten the time employees have to pursue discrimination claims under certain federal employment laws.

While the decision currently applies only within the Fourth Circuit, it highlights an important compliance issue for employers that rely on standardized offer letters, employment agreements, or onboarding documents.

The Issue: Contractual Deadlines vs. Federal Employment Rights

Many employment agreements contain provisions that require employees to bring workplace claims within a shortened period of time—often six months or 180 days.  Employers often include these provisions to create certainty and avoid defending stale claims years after an event occurred.  However, federal anti-discrimination laws operate under a unique process that requires employees to first file a charge with the Equal Employment Opportunity Commission (EEOC) before filing a lawsuit. That administrative process can take months—or even longer—before an employee receives authorization to proceed to court. The Fourth Circuit concluded that employers cannot use private agreements to effectively cut short that statutory process.

Why This Matters

The court’s decision specifically impacts claims brought under:

• Title VII of the Civil Rights Act of 1964
• The Age Discrimination in Employment Act (ADEA)

These laws govern many of the most common workplace discrimination claims, including allegations involving:

• Race discrimination
• Sex discrimination
• Religious discrimination
• National origin discrimination
• Age discrimination

Because employees must first go through the EEOC process before filing suit, the court found that employers cannot contractually reduce the time available for employees to exercise those rights.

What Employers Should Review

Employers should take this opportunity to review:

Employment Agreements

Examine offer letters, employment contracts, arbitration agreements, and onboarding documents for language that shortens legal filing deadlines.

Multi-State Compliance

Organizations operating in multiple states should be especially cautious. Different courts may interpret these provisions differently, and agreements that were once considered standard may face increasing legal scrutiny.

HR Policies and Onboarding Practices

Employers should ensure HR teams understand which contractual provisions remain enforceable and which may create unnecessary legal risk.

Legal Templates

Many companies continue to use employment agreement templates that were drafted years ago. Those documents should be periodically reviewed to ensure they remain compliant with evolving legal standards.

The Bigger Trend

This decision reflects a broader trend among courts and regulators: increased scrutiny of employment agreements that may limit employee rights under federal workplace laws.

As workplace compliance requirements continue to evolve, employers should view employment agreements as living documents rather than “set it and forget it” paperwork.

Regular reviews of employment policies, onboarding materials, arbitration agreements, and employee handbooks can help organizations reduce risk while maintaining compliance with changing legal requirements.

Forework’s Perspective

Employment compliance doesn’t begin when a claim is filed—it begins with the systems, documents, and processes employers use every day. As regulations and court decisions continue to reshape the workplace landscape, employers should regularly evaluate their onboarding documentation, HR practices, and compliance procedures to ensure they align with current legal requirements. A proactive review today can help prevent costly disputes tomorrow.

Connecticut employers should prepare now for a wave of new workplace regulations that will affect hiring practices, payroll administration, employee communications, workplace accommodations, and the use of artificial intelligence in employment decisions.

The Connecticut General Assembly recently passed sweeping legislation that introduces new requirements for wage transparency, payroll disclosures, accommodation notices, employee retention obligations, and AI-driven employment tools. While many of the provisions do not take effect until late 2026 or 2027, employers that begin planning now will be in a much stronger position to avoid compliance challenges later.

At Forework, we believe compliance starts long before a law becomes effective. Employers should use this lead time to evaluate payroll processes, recruiting practices, job posting procedures, employee communications, and HR technology platforms.

Below are the key developments employers should be monitoring.

1. Job Postings Must Include Pay Ranges and Benefits Information

Beginning October 1, 2026, Connecticut employers will be required to include:

• A good-faith wage range
• A general description of benefits

in both internal and external job postings.

This expansion goes beyond Connecticut’s existing wage transparency requirements and will impact recruiting, compensation planning, and internal promotion processes.

For employers with remote workforces, the law may apply even when employees work outside Connecticut if they report to a Connecticut-based supervisor or office.

What Employers Should Do Now

• Review job posting templates
• Establish documented salary ranges for positions
• Coordinate compensation and recruiting teams
• Ensure benefits descriptions are standardized and consistent

2. New Restrictions on Employee Repayment Agreements

Connecticut is expanding its prohibition on employment promissory notes to all employers, regardless of size.

Agreements that require employees to repay training costs or similar expenses as a condition of employment may become unenforceable if they fall within the law’s definition of an employment promissory note.

What Employers Should Do Now

• Review training reimbursement agreements
• Audit onboarding documents
• Evaluate retention and workforce development programs

3. New Disability Accommodation Notice Requirements

Beginning October 1, 2026, employers must provide employees with notice of their rights to workplace accommodations under the Americans with Disabilities Act (ADA).

The notice requirement applies:

• To all new hires
• To current employees
• When an employee informs the employer of a disability

What Employers Should Do Now

• Update onboarding materials
• Review ADA policies and procedures
• Prepare for distribution of required notices

4. Expanded Lactation Accommodation Obligations

The new law reinforces employers’ obligations to provide reasonable break time for nursing employees and to maintain appropriate lactation spaces.

The legislation makes clear that employers must provide break time beyond regularly scheduled breaks when necessary.

What Employers Should Do Now

• Review workplace accommodation policies
• Confirm designated lactation spaces meet legal requirements
• Train managers on accommodation requests

5. New Payroll Transparency Requirements for Larger Employers

One of the most significant operational changes affects employers with 100 or more employees.

Beginning October 1, 2026, covered employers must provide employees with a guide explaining payroll codes used for overtime and common pay differentials.

These pay codes often appear on pay statements as abbreviations that employees may not understand.

Examples include:

• Overtime codes
• Shift differentials
• Holiday pay
• Weekend premiums
• Hazard pay
• On-call compensation

The guide must be maintained and updated as payroll practices evolve.

Why This Matters

Payroll transparency is becoming a growing focus among regulators nationwide. Employers should ensure their payroll systems produce information that employees can easily understand and verify.

For organizations using third-party payroll providers, now is a good time to determine whether your provider can support these requirements.

6. Construction Industry Employers Face New Wage Liability Exposure

Construction contractors will face expanded responsibility for unpaid wages owed by subcontractors.

The law creates joint liability provisions that significantly increase the importance of subcontractor oversight and payroll compliance monitoring.

What Employers Should Do Now

• Review subcontractor agreements
• Strengthen payroll audit procedures
• Evaluate wage compliance monitoring practices

7. Successor Employers May Be Required to Retain Existing Workers

Beginning July 1, 2027, certain businesses taking over service contracts or acquiring covered properties may be required to retain existing employees for a transition period.

The law affects industries that rely heavily on:

• Janitorial services
• Security services
• Building maintenance
• Facilities management
• Property operations

Employers involved in acquisitions, outsourcing arrangements, or service contract transitions should incorporate these obligations into workforce planning efforts.

8. Artificial Intelligence in Employment Decisions Faces New Regulation

Connecticut is also moving toward increased regulation of AI tools used in employment decisions.

Employers using automated technologies for:

• Recruiting
• Applicant screening
• Hiring decisions
• Promotions
• Discipline
• Performance evaluations
• Terminations

may soon face new notice and disclosure requirements.

The legislation requires greater transparency regarding how automated systems are used and what information is analyzed when employment decisions are made.

Why Employers Should Pay Attention

Many organizations are already using AI-enabled recruiting and HR platforms without fully understanding how those systems operate.

Employers should begin:

• Inventorying AI-powered HR tools
• Reviewing vendor agreements
• Assessing potential bias-testing capabilities
• Evaluating compliance documentation

Organizations that wait until the law becomes effective may find themselves scrambling to gather information from software vendors.

Forework’s Perspective

The most important takeaway from Connecticut’s 2026 legislative session is that workforce compliance is becoming increasingly connected to payroll data, compensation practices, employee communications, and HR technology.

Many of these requirements cannot be addressed solely through policies. They require operational systems that support transparency, consistency, and accurate workforce administration.

Employers that take a proactive approach now will be far better positioned when these laws take effect.

Forework will continue monitoring these developments and helping employers align their payroll, workforce management, and compliance processes with the evolving regulatory landscape.