A new year always brings new employment law changes. Are you up to date on the key developments you need to watch out for?

Here’s a round-up of the most significant changes small and mid-size employers should be aware of.

Federal laws


This is the big one. The long-awaited changes to the federal overtime rules were finalized last fall and took effect on January 1, 2020.

The old salary threshold, which stated workers need to earn at least $455 per week to be considered exempt from overtime pay, has been raised to $684 per week, or $35,568 per year. Up to 10% of the salary minimum can be made up of commissions, bonuses, and other incentives that are paid out once a year or more frequently.

As a result of the increase, several employers now have more employees in the “salaried, non-exempt” bucket.

Note that some states also have their own rules for overtime. When that’s the case, employees are entitled to the higher level of pay.

Minimum wage

Twenty-one states increased their minimum wage rates on January 1, with four more plus the District of Columbia bumping rates up later in 2020. New York State also saw an increase on December 31, 2019, which brought the minimum wage for small employers in New York City to $15 an hour. 

As with overtime, many states and municipalities have their own minimum wage rates, and employees are always entitled to the highest applicable rate.


The DOL’s H-2B program allows employers to hire non-immigrants on a temporary, seasonal basis for certain non-agricultural jobs (the H-2A program is similar, but for agricultural jobs). 

A final rule effective December 16, 2019, removes the old requirement that employers post H-2B job opportunities in local print newspapers. The DOL will now post these opportunities on its own website.

State laws

Below are some (but not all) of the most prominent legal changes that will affect employers around the country in 2020.

Discrimination and harassment

In addition to federal EEOC laws, the following states have made updates to their discrimination or harassment regulations. 

StateLegal updateEffective date
CaliforniaCalifornia now protects certain hairstyles as a subset of the race-based anti-bias protections.
January 1, 2020
ConnecticutConnecticut has expanded its sexual harassment training requirements for employers.October 1, 2019
IllinoisThe Illinois Human Rights Act will apply to employers with just one employee (down from 15). Also, Illinois has enacted a number of new harassment protections in the wake of #MeToo, many of which are effective January 1, 2020. July 1, 2020
New YorkNew York prohibits discrimination on the basis of reproductive health decision-making or domestic violence.November 2019
WashingtonWashington has passed new anti-harassment protections and training requirements to protect hospitality and retail workers, as well as those working for property services contractors and security companies. January 1, 2020 for larger hotels and motels

January 1, 2021 for all other covered employers

Independent contractors

Contractor misclassification can result in major fines for small business owners. Make sure you’re up to date with your state’s latest regulations.

StateLegal updateEffective date
CaliforniaAB5 imposes a new three-part test for independent contractor status that was first set out by the California Supreme Court. The new test makes it much more likely that a worker will be considered an employee rather than an independent contractor.

January 1, 2020
ColoradoA new law officially defines wage theft as theft and clarifies who is considered an employee for purposes of the law.January 1, 2020
TennesseeTennessee now uses the 20-factor IRS test for independent contractor classification. The 20 factors are spelled out in the law.January 1, 2020

Family and medical leave

StateLegal updateEffective date
CaliforniaCalifornia employers are now required to provide an additional 30 days of unpaid leave to employees who are donating an organ.

The paid family leave entitlement also expands from 6 weeks to 8 weeks, starting July 1, 2020.
January 1, 2020
District of ColumbiaEmployees can start taking paid family leave.July 1, 2020
IllinoisThe School Visitation Rights Act will expand to include employee attendance at behavioral meetings and academic meetings. You cannot terminate employees for attending these.August 1, 2020
MaineMaine employees will accrue one hour of earned paid sick leave for every 40 hours worked. The law applies to employers with 11 or more employees.January 1, 2021
NevadaNevada employers with 50 or more employees must provide employees with up to 40 hours of paid leave per yearJanuary 1, 2020
OregonOregon has added organ and tissue donation to its definition of “serious health condition” for family leave purposes.January 1, 2020
Washington StateEmployees can start taking paid family and medical leaveJanuary 1, 2020

Marijuana and vaping

StateLegal updateEffective date
IllinoisState law authorizes the use of cannabis for individuals age 21 and over. Employers are not required to allow on-duty use or possession, but they cannot fire (or refuse to hire) individuals for lawful use while off-duty and off-call. January 1, 2020
NevadaEmployers cannot—with certain exceptions—deny employment on the basis of marijuana detected in a screening test. Additionally, the state has added vaping to its law prohibiting smoking in indoor workplaces.January 1, 2020
OklahomaOklahoma has added vaping (tobacco or marijuana) to its prohibition on smoking in indoor workplacesJanuary 1, 2020

If your state newly allows the use of marijuana, make sure you’re prepared to update your workplace policies around cannabis usage.

Pay equity and salary history

StateLegal updateEffective date
ColoradoNew equal pay protections, including a ban on salary history questions, will take effect.January 1, 2021
New JerseyEmployers are barred from asking questions about a worker’s wage and salary experience.January 1, 2020
New YorkEmployers are prohibited from seeking salary history from applicants.January 6, 2020

Check out our map for the complete list of cities and states that have outlawed salary history questions.


StateLegal updateEffective date
CaliforniaThe California Consumer Privacy Act (CCPA) will require companies meeting certain requirements to take various steps to protect and disclose consumer data. Employers are exempt from some requirements relating to information obtained in the normal scope of the employment process, but this exemption expires at the end of 2020.January 1, 2020
IllinoisThe Artificial Intelligence Video Interview Act imposes new notification and consent requirements when employers use AI intelligence to evaluate applicant-submitted videos. Employers are also barred from sharing applicant videos, except as necessary to evaluate candidates.January 1, 2020

Review your state’s laws

We’ve tried to hit the major 2020 updates, but this is a general round-up only that may not include everything your business needs to know for the year ahead.

Check with the applicable employment-related agencies in your state to get the full details, or consult your legal advisor to ensure you’re compliant with all the laws that apply to your business. 

Jennifer Carsen Jennifer Carsen is an enrolled agent and recovering employment lawyer. She creates memorable content for small business owners and HR professionals on various topics, including employment law and benefits compliance.
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