In a joint statement, Chair Andrew Ferguson and Commissioner Melissa Holyoak—both of whom dissented from the prior administration’s sweeping non-compete ban—indicated that the Federal Trade Commission (“FTC”) will pivot away from broad rulemaking and instead pursue a case-by-case enforcement strategy.

Under this new approach, the FTC plans to bring a “steady stream” of targeted enforcement actions to define the limits of lawful non-competes under the FTC Act and the Sherman Act, rather than imposing a nationwide prohibition through regulation.

Commissioner Meador’s Framework for Assessing Non-Competes

In a separate statement concurring with the withdrawal of the agency’s appeals, Commissioner Mark Meador outlined a framework for evaluating non-compete agreements based on their “competitive character.” He identified several key factors that the FTC may weigh in future enforcement actions:

• Employee wage and skill level: Non-competes may be less defensible for low-wage workers and more justifiable for highly skilled roles.
• Distribution and franchise structures: Non-competes raise greater concern where they restrict competition horizontally within a network.
• Independent contractors: The analysis should consider whether contractors operate exclusively for the company or receive specialized training or resources.
• Free-riding concerns: Whether the employer invested in training or shared proprietary information that the employee could leverage post-employment.
• Less restrictive alternatives: Employers should consider confidentiality, IP protection, or non-solicitation clauses before resorting to non-competes.
• Scope and duration: The agreement must be no broader than necessary in geography, duration, and industry coverage.
• Market power: The FTC is likely to scrutinize non-competes imposed by dominant firms or those widely used across an industry.

Details of the FTC’s Enforcement Action

The FTC’s complaint alleged that Gateway Pet Memorial Services had, since 2019, required nearly all employees—including drivers and facility-level laborers—to sign non-compete agreements prohibiting them from working anywhere in the U.S. pet cremation industry for one year following employment.

The FTC found this approach problematic for several reasons:

• The Company applied the agreements uniformly across all levels of staff, without individualized justification.
• The nationwide geographic scope was considered overly broad, restricting employees from working in areas where the Company had no operations.

Under the proposed consent order (“Proposed Order”), the Company must immediately stop enforcing existing non-competes and is barred for ten years from entering into or maintaining such agreements with most employees.

Exceptions apply for directors, officers, or senior employees in connection with equity grants or the sale of a business involving individuals holding ownership interests.

The Proposed Order also places limits on non-solicitation agreements, permitting them only with respect to customers with whom the employee had direct contact or provided service within the prior 12 months. Additionally, the Company must notify current and former employees that their non-compete agreements are void and inform all new hires that they will not be subject to such restrictions.

What Employers Should Take Away

According to Chair Ferguson, this action and the FTC’s decision to withdraw its appeals reflect a strategic shift from rulemaking to enforcement. The agency plans to use real-world cases to define the line between lawful and unlawful non-compete practices.

Employers should anticipate increased scrutiny and enforcement activity in this area and are strongly advised to review their current non-compete, non-solicitation, and confidentiality agreements. Agreements that are overly broad, indiscriminate, or not tailored to legitimate business interests may invite regulatory attention.

How Forework Can HelpIf you’d like guidance on assessing or revising your company’s restrictive covenant policies in light of the FTC’s latest enforcement posture, contact Forework today.

On October 16, 2025, the New York City Council passed two bills that, if enacted, will require large employers to report detailed pay data by race and gender. These measures aim to enhance pay equity transparency across the city’s workforce. While the reporting obligations would take effect immediately, employers will not be required to submit data until the City establishes the process for doing so.  In this article, we describe the proposed laws.

Overview of the Reporting Framework

Under Bill Int. 982A, the City must designate a responsible agency within one year of the law’s effective date. Once designated, that agency will have another year to develop a standardized, fillable reporting form for covered employers.

Within one year of that form’s publication—and annually thereafter—employers with 200 or more employees (including full-time, part-time, and temporary workers) will be required to submit pay data reports. These reports must include information aligned with the categories used in the EEOC’s EEO-1 Component 2 reporting for 2017–2018, including employee race, ethnicity, and gender.

The designated agency may also update or expand these categories, such as by adding reporting options that reflect different gender identities.

Employer Certification and Compliance

In addition to filing the pay report, each employer must submit a signed certification statement confirming the accuracy and completion of its submission. While employers may choose to file their pay reports anonymously, the certification statement itself must identify the employer.

The designated agency will publish an annual list of noncompliant employers on its website. Before appearing on that list, employers will receive written notice and at least 30 days to cure any deficiencies.

Violations will carry the following penalties:

• First offense: A written warning if corrected within 30 days of notice; otherwise, a $1,000 civil penalty.
• Subsequent offenses: A $5,000 civil penalty per violation.

Citywide Pay Equity Study

Under the companion measure, Bill Int. 984A, the designated agency must conduct an annual pay equity study beginning one year after the first round of employer submissions. The study will analyze pay data in aggregate form and publish results that do not identify specific employers or employees.

The agency will also continue to post a list of employers that fail to comply with the reporting requirements.

Legislative Outlook

Both bills passed with strong support—over 80% of the City Council—enough to override a potential veto by Mayor Eric Adams. If enacted, these measures will establish one of the most comprehensive local pay transparency reporting systems in the country.

What Employers Should Do Now

Employers with 200 or more employees should begin reviewing internal pay data systems and ensuring that demographic and compensation information is accurately maintained. Preparing early will make compliance easier once the reporting process is finalized.

Forework Can HelpIf you have questions about these new pay data reporting bills or how to prepare your organization for compliance, contact Forework for assistance.

New York City Proposes Expanding Sick and Safe Leave Requirements in 2026

On September 25, 2025, the New York City Council approved a bill (the “Bill”) that, if enacted by Mayor Adams, will significantly expand employee entitlements under the City’s Earned Safe and Sick Time Act (“ESSTA”). The Bill – if signed into law – would take effect 120 days thereafter.

Current ESSTA Requirements

Under the existing law, employers with 99 or fewer employees must provide up to 40 hours of sick and safe time annually, while employers with 100 or more employees must provide up to 56 hours per year. Time accrues at a rate of one hour for every 30 hours worked. With the exception of employers with four or fewer employees and a net income under $1 million in the previous year, all ESSTA leave must be paid.

Key Proposed Changes to ESSTA

Expanded Reasons for Leave

Currently, ESSTA allows employees to use leave for illness, preventive care, caring for a family member, closures during a public health emergency, or for “safe time” in situations involving domestic violence, sexual offenses, stalking, or human trafficking.

If enacted, the Bill would require New York City employers to also provide leave in the following additional circumstances:

• Public disaster closures: When a workplace, school, or childcare center is closed by order of a public official due to a public disaster (including fire, terrorist attack, or severe weather).
• Public disaster restrictions: When a public official directs individuals to stay indoors or avoid travel.
• Workplace violence: When an employee or their covered family member has been the victim of workplace violence, defined as any act or threat of violence occurring in a place of employment.
• Caregiving: When an employee is acting as a caregiver to a minor child or another care recipient.
• Legal and subsistence matters: When an employee attends or prepares for legal proceedings related to subsistence benefits or housing, or takes necessary actions to apply for, maintain, or restore such benefits for themselves or their family members.

Additional 32 Hours of Unpaid Leave

The Bill introduces a new entitlement: 32 hours of unpaid sick and safe leave provided at hire and on the first day of each calendar year. Unused unpaid leave does not carry over to the following year, and employees may only use it after exhausting accrued paid leave under ESSTA.

Paid Prenatal Leave

Another notable change is the addition of 20 hours of paid prenatal leave per rolling 52-week period. This leave is in addition to an employee’s regular sick and safe time entitlement. Employers may require a minimum increment of one hour per day for prenatal leave (compared to the four-hour minimum increment for other ESSTA leave types).

Coordination with the Temporary Schedule Change Act

The Bill also seeks to streamline employee rights under the ESSTA with the NYC Temporary Schedule Change Act (“TSCA”). Currently, the TSCA allows employees two temporary schedule changes per year for “personal events.” Because these events will now be covered under the ESSTA, the TSCA would be repealed. Employees will continue to have the right to request ESSTA leave for personal events and remain protected from retaliation for doing so.

Next Steps for Employers

If Mayor Adams signs the Bill, New York City employers should:

1. Review and update leave policies to incorporate the expanded ESSTA provisions and eliminate references to the TSCA.
2. Train managers and HR personnel on the new rules to ensure proper handling of employee leave requests.
3. Update payroll and HRIS systems to account for the changes and automated tracking systems.

How Forework Can Help

Navigating New York City’s evolving employment laws can be challenging. Forework’s compliance experts are available to help your business update policies, train staff, and maintain compliance with ESSTA and other wage and hour requirements.

If you have questions about how these changes may affect your organization, contact Forework today.

In a unanimous decision issued on June 5, 2025, the U.S. Supreme Court overturned a Sixth Circuit ruling that had imposed an elevated burden on majority-group employees—such as heterosexual individuals—who bring discrimination claims under Title VII of the Civil Rights Act of 1964. The Court made clear that plaintiffs should not face a steeper evidentiary threshold simply because they belong to a majority demographic.

Case Background: Ames v. State of Ohio Department of Youth Services

The case involved a former employee of the Ohio Department of Youth Services who alleged she was passed over for a promotion in favor of a lesbian woman and subsequently demoted and replaced by a gay man—both of whom, she claimed, were less qualified. She filed suit under Title VII, asserting discrimination based on her heterosexual status.

At the summary judgment stage, the U.S. District Court for the Southern District of Ohio dismissed the claims, relying on a requirement that plaintiffs who are part of a majority group must present additional “background circumstances” to suggest that the employer is unusually inclined to discriminate against the majority. This approach added an extra layer to the traditional McDonnell Douglas burden-shifting framework used in disparate treatment cases.

The Sixth Circuit affirmed that reasoning, holding that the plaintiff’s status as a heterosexual required her to satisfy this added evidentiary burden as part of her prima facie case.

Supreme Court’s Ruling

The Supreme Court disagreed, finding that the “background circumstances” requirement is inconsistent with Title VII. The Court stated unequivocally that the statute “draws no distinctions between majority-group plaintiffs [and] minority-group plaintiffs.” It rejected the notion that plaintiffs from majority groups must meet any additional burden to proceed with a discrimination claim.

The Court emphasized that this added requirement improperly altered the well-established McDonnell Douglas framework and unfairly treated plaintiffs differently based on their demographic status. As a result, the matter was remanded to the district court to assess the plaintiff’s claims using the clarified, uniform legal standard.

Impact on Employers and Title VII Litigation

This decision resolves a long-standing circuit split. Previously, courts in the Sixth, Seventh, Eighth, Tenth, and D.C. Circuits had adopted the “background circumstances” test. In contrast, the Third and Eleventh Circuits had rejected it. The Supreme Court’s ruling ensures a consistent standard nationwide for assessing Title VII disparate treatment claims, regardless of the plaintiff’s demographic background.

Practical Takeaways for Employers

• Heightened Litigation Risk in Certain Jurisdictions: Employers operating in jurisdictions formerly applying the “background circumstances” test—such as Ohio, Michigan, Tennessee, Kentucky, Indiana, Illinois, and others across the Midwest and Mountain West—should expect more claims from majority-group plaintiffs to proceed past the early stages of litigation.
• DEI Programs Under Scrutiny: The decision arrives amid increased political and legal scrutiny of diversity, equity, and inclusion (DEI) initiatives. Employers should evaluate whether their policies or practices could be interpreted as treating employees differently based on protected class membership—intentionally or not.
• Policy Review Recommended: Now is a prudent time to revisit anti-discrimination policies, promotion criteria, and internal complaint procedures to ensure they comply with Title VII in both spirit and application.

If you have any questions about the Supreme Court’s Title VII ruling, please contact any member of the Forework team.

The Trump Administration’s proposed Fiscal Year 2026 budget outlines a substantial funding reduction for the Occupational Safety and Health Administration (OSHA). According to the Congressional Budget Justification, the administration is seeking to trim OSHA’s total budget by approximately 8%, decreasing the agency’s funding from $632.3 million in FY 2025 to $582.4 million in FY 2026.

Enforcement Programs Face Largest Cuts

The most notable decrease targets OSHA’s enforcement division, which would see its budget reduced by $23.7 million. This contraction is expected to impact the agency’s ability to conduct workplace inspections and pursue enforcement actions.

Additionally, the proposal includes a workforce reduction from 1,810 to 1,587 full-time equivalent positions, eliminating 223 roles. While the budget does not specify the exact mechanisms for these staffing changes, they may result from attrition, retirements, or voluntary buyouts rather than layoffs.

Implications for Employers and Workers

If enacted, the budget cuts could significantly shift how OSHA operates. With fewer resources and compliance officers available, the agency is likely to:

• Scale back scheduled or “programmed” inspections, particularly those not triggered by imminent danger or formal complaints.
• Rely more heavily on written correspondence—such as hazard alert letters or requests for documentation—instead of sending inspectors onsite in response to complaints or serious incidents.
• Slow the development and release of new safety standards and interpretive guidance, continuing a trend of delayed regulatory updates in recent years.

Employers should remain attentive to OSHA’s evolving enforcement priorities and consider proactive compliance strategies to reduce risk in a potentially less regulated environment.

If you have any questions regarding the FY 2026 Budget, please contact any member of the Forework team.

In response to New York State’s newly enacted paid prenatal leave mandate, the New York City Department of Consumer and Worker Protection (DCWP) has revised its regulations under the NYC Earned Safe and Sick Time Act (ESSTA). These amendments, which take effect on July 2, 2025, incorporate specific requirements for the administration of prenatal leave by employers within the city.

Overview of the Statewide Mandate

Starting January 1, 2025, all New York employers must provide up to 20 hours of paid leave in any 52-week period for prenatal medical appointments and pregnancy-related healthcare services. This benefit is immediately accessible to employees upon a qualifying need and is in addition to other leave entitlements, including sick leave. Employers are prohibited from demanding sensitive medical details or documentation as a condition for using this leave.

Key Changes to ESSTA Rules

To harmonize local requirements with the state law, NYC’s updated ESSTA rules clarify several employer responsibilities:

1. Pay Stub and Leave Usage Disclosure

For every pay period during which an employee uses paid prenatal leave, employers must inform the employee in writing of:

• The amount of paid prenatal leave used during that pay period, and
• The remaining balance available.

This disclosure can be provided on the employee’s pay stub or in a separate written statement, similar to ESSTA’s existing reporting obligations.

2. Mandatory Written Policy

Employers must now implement a standalone written policy addressing paid prenatal leave. At a minimum, this policy must include:

• A clear statement that employees are entitled to a separate bank of 20 hours of paid prenatal leave per 52-week period.
• Rules regarding how leave can be requested and in what increments.
• Disciplinary guidelines for misuse.
• A confidentiality statement affirming that employees will not be required to disclose private health information and that any information received will be kept confidential.

Employers must distribute this policy:

• At the time of hire,
• Within 14 days of any revisions, and
• Upon employee request.

3. Use of Other Leave Prohibited

The new rules align with guidance from the New York State Department of Labor in affirming that employers:

• May not require employees to use or exhaust other leave before or instead of paid prenatal leave, and vice versa.
• May not mandate substitution of prenatal leave with other forms of leave.

However, with mutual agreement, employers and employees may opt to modify work schedules instead of using prenatal leave time.

4. No Make-Up Time or Shift Coverage Required

Employers cannot require employees who use paid prenatal leave to:

• Work extra hours to compensate for missed time, or
• Find someone to cover their shift during their absence.

Next Steps for Employers

With the July 2, 2025 effective date approaching, NYC employers should:

• Review and update workplace policies and handbooks to include a compliant prenatal leave policy.
• Adjust payroll systems to track and report prenatal leave usage.
• Train HR and supervisory staff on the new requirements and confidentiality obligations.

If you have any questions regarding Prenatal Leave Law, please contact any member of the Forework team.

On June 2, 2025, the U.S. Department of Labor (DOL) announced a significant relaunch and broadening of its Opinion Letter Program, a long-standing initiative aimed at helping the public navigate complex labor law questions. The Program provides formal, written interpretations of how DOL enforcement agencies would apply federal labor laws in particular workplace situations.

These opinion letters are a valuable compliance resource for employers, employees, and their advisors. They offer clarity on how the law applies to specific factual scenarios and can be requested by anyone—businesses, trade associations, unions, or individuals—seeking guidance on nuanced or uncertain areas of the law.

Expanded Scope Across DOL Agencies

The newly relaunched Program now encompasses five major DOL enforcement agencies, each contributing to the initiative through distinct forms of interpretive guidance:

• Wage and Hour Division (WHD): Will resume issuing formal opinion letters on matters such as wage payment obligations, exemptions under the Fair Labor Standards Act (FLSA), and leave requirements under the Family and Medical Leave Act (FMLA).
• Veterans’ Employment and Training Service (VETS): Will also issue opinion letters related to veterans’ employment protections.
• Occupational Safety and Health Administration (OSHA): Will provide interpretive letters clarifying workplace safety and health regulations.
• Employee Benefits Security Administration (EBSA): Will issue information letters and advisory opinions addressing questions under ERISA and related employee benefits laws.
• Mine Safety and Health Administration (MSHA): Will disseminate regulatory updates, training materials, and other forms of compliance guidance through a new centralized information hub.

Historical Context and Administrative Trends

The DOL’s approach to opinion letters has fluctuated across administrations. The Obama-era DOL discontinued the use of WHD opinion letters in favor of more general administrator interpretations. The Trump administration reinstated the practice, resulting in the issuance of over 70 letters between 2018 and early 2021. The Biden administration scaled back the volume of such guidance, issuing only a limited number during its term.

This latest relaunch signals a renewed emphasis—under the current administration—on proactive compliance assistance, transparency, and greater stakeholder engagement.

Benefits of the Opinion Letter Program

The expanded Program offers several key advantages to the regulated community:

1. Proactive Risk Mitigation: Employers can seek preemptive guidance on legal gray areas, potentially reducing the likelihood of enforcement actions or litigation.
2. Policy Insight: Letters may reflect evolving interpretations of labor laws and provide early indications of shifting enforcement priorities.
3. Centralized Access and Submission Portal: The DOL has launched a dedicated website where the public can access existing guidance and obtain instructions for submitting new requests for opinion letters or related interpretations.

Practical Considerations for Employers

While opinion letters can serve as persuasive authority in court and provide a strong foundation for compliance efforts, they are not binding on courts and do not carry the same weight as formal regulations. Moreover, not every request results in the issuance of an opinion letter, and the DOL exercises discretion in determining which inquiries merit a response.

Employers should consider working with experienced legal counsel to:

• Assess whether an opinion letter request is appropriate for a particular workplace issue,
• Frame and submit the request in a way that enhances the likelihood of a favorable and actionable response, and
• Align internal policies with the latest DOL guidance to strengthen compliance and limit exposure.

If you have any questions regarding the Opinion Letter Program, please contact any member of the Forework team.

On May 1, 2025, the U.S. Department of Labor’s Wage and Hour Division announced that it will no longer enforce its 2024 Final Rule governing independent contractor classification under the Fair Labor Standards Act (FLSA). Instead, the agency will apply the framework set out in a 2008 Fact Sheet and a previously withdrawn 2019 Opinion Letter.  This will likely alleviate and reduce some of the exposure to liability for companies who misclassify workers (knowing or unknowingly) under the FLSA. 

Key Points from the DOL’s Announcement

• The 2024 Final Rule remains in effect for private litigation, but the DOL will not use it in agency investigations that involve unpaid wages or settlements initiated on or after May 1, 2025.
• The DOL explained it is reevaluating the 2024 Final Rule and may ultimately rescind or revise it.
• In the interim, the DOL will rely on prior guidance to assess whether a worker is an employee or an independent contractor under the FLSA.

The 2008 Framework

The DOL’s 2008 guidance emphasizes an “economic reality” test rather than formal technical concepts. The following factors are considered significant:

• Whether the work is an integral part of the business
• The permanence of the working relationship
• The worker’s investment in tools, equipment, or facilities
• The level of control exercised by the employer
• The worker’s opportunity for profit or loss
• The degree of initiative or judgment used in competing in the marketplace
• The extent to which the worker operates an independent business

Certain elements are not considered relevant when assessing employment status, including:

• The location where work is performed
• Whether a written agreement exists
• Whether the worker holds a state or local license
• The method or timing of compensation

Reference to the 2019 Opinion Letter

The 2019 Opinion Letter, now informing current DOL enforcement, analyzed whether workers for an online marketplace platform were employees or independent contractors. It concluded that the workers were independent contractors based on their economic independence and application of the same core factors.

What Employers Should Know

The DOL may issue further rulemaking in this area. For now, employers should evaluate contractor classifications under the 2008 economic reality framework and stay informed on any forthcoming updates. Legal counsel can assist in reviewing worker classifications to ensure compliance with the evolving enforcement standards.

If you have any questions regarding the independent contract rule, please contact any member of the Forework team.

In 2024, the Federal Trade Commission (FTC) introduced a rule that would have prohibited noncompete agreements nationwide. However, employers challenged the rule in multiple forums and secured victories before the National Labor Relations Board and U.S. District Courts in Texas and Florida. These outcomes led to a permanent injunction blocking the rule as of August 20, 2024.

Status of the Appeals

• The FTC appealed the Texas and Florida decisions to the Fifth and Eleventh Circuit Courts of Appeals.
• In February 2025, FTC Chairman Andrew Ferguson indicated the agency would reevaluate its strategy.
• Ferguson also directed the formation of a labor task force to investigate deceptive and anticompetitive labor practices, including noncompete agreements.
• The FTC requested a 120-day stay in both appeals, which was granted. The cases are now on hold until July 2025.

Impact on Employers

With the FTC rule on hold, the enforceability of noncompete agreements continues to be governed by state law, which varies widely across jurisdictions. Some states, such as California, broadly prohibit noncompete agreements, while others, like Ohio, are considering similar restrictions. In Washington, employers may face penalties if they attempt to enforce a noncompete that is deemed invalid under state law.

Alternative Protections for Employers

Even in states where noncompetes are unenforceable, employers can use alternative contractual protections:

• Confidentiality clauses to safeguard proprietary information.
• Non-solicitation clauses to prevent former employees from targeting clients or co-workers.

Although these measures offer more limited protection than noncompete agreements, they still help preserve business interests.

Recommended Next Steps

Employers should consult with legal counsel to ensure their agreements align with current state law. Regular reviews are especially important as state-level legislation continues to evolve.

If you have any questions regarding noncompete agreements, please contact any member of the Forework team.

A federal judge has blocked a recent effort by the Trump administration to roll back Temporary Protected Status (TPS) for approximately 600,000 Venezuelan immigrants living in the United States. The ruling preserves the protections currently in place, allowing beneficiaries to remain in the country without immediate risk of deportation.

TPS was originally extended to Venezuelans due to the ongoing political and economic crisis in their home country. The program allows individuals from designated nations to live and work legally in the U.S. if returning to their home country would pose a threat to their safety.

The court’s decision emphasized the potential hardship that could result if protections were removed, particularly given Venezuela’s continued instability. While the administration had sought to narrow the program, the judge found that doing so at this time would be premature and potentially harmful to those affected.

Immigrant advocacy groups have responded positively to the ruling, citing the importance of maintaining humanitarian protections. The decision adds to the broader legal and political conversation surrounding U.S. immigration policy, particularly in how it addresses individuals fleeing crisis situations abroad.

Those currently protected under TPS are encouraged to monitor official updates and consult with legal professionals to stay informed about any future developments.

If you have any questions regarding TPS, please feel free to contact Forework.