Mid‑Year Employment Law Check‑In: Key Updates + What’s New in PA
As we approach the halfway point of 2025, the employment law landscape continues to shift rapidly—at both the federal level and across key states, including Pennsylvania. Below is a comprehensive overview of some of the most significant developments employers should be tracking now.
Federal Updates
1. White‑Collar Overtime Rule Put on Hold
A federal court recently blocked the U.S. Department of Labor’s planned increase to the salary threshold for overtime-exempt employees.
The increases to $844/week (July 2024) and $1,128/week (January 2025) are no longer moving forward.
For now, the 2019 threshold of $684 per week ($35,568 per year) still applies.
Employers should double-check any employee classifications made based on the expected changes.
2. Executive Orders Targeting DEI & Disparate Impact
Two recent executive orders signed in early 2025 are reshaping federal civil rights enforcement:
EO 14151 (January 20, 2025) rescinds federal DE&I initiatives, including agency-level diversity mandates and hiring targets.
EO 14173 limits the government’s ability to challenge workplace policies that appear neutral but unfairly impact protected groups.
3. Federal Workforce Reclassification and Union Rights
The administration is reintroducing a reclassification of certain federal employees into a new “Schedule Policy/Career” (formerly Schedule F), effectively converting many roles to at-will status.
In March 2025, unionization rights were revoked for approximately 67% of federal workers, eliminating their collective bargaining power.
4. Rollbacks on Transgender and LGBTQ Protections
The current Equal Employment Opportunity Commission leadership has:
Halted enforcement of gender identity-related discrimination claims,
Removed nonbinary/X-gender options from federal employment forms, and
Rescinded prior guidance promoting inclusive workplace practices.
These changes raise compliance concerns, especially for federal contractors and employers in states without clear LGBTQ protections.
Key Pennsylvania Developments
1. Healthcare Noncompete Ban Now in Effect
Effective January 1, 2025, Pennsylvania’s Fair Contracting for Health Care Practitioners Act prohibits most noncompete agreements for:
Physicians, osteopaths, nurse practitioners, physician assistants, and certified registered nurse anesthetists (CRNAs).
Any agreement that restricts practice beyond one year or includes broad patient non-solicitation provisions is now void unless the provider resigns voluntarily.
Additionally, employers must notify affected patients within 90 days of a provider’s departure.
2. Workers’ Compensation: Direct Deposit Now Required
Under Senate Bill 1232, insurers and employers are now required to offer direct deposit for workers’ compensation benefits. This change modernizes payment processes and reduces delays for injured workers.
3. New Rules on Minors’ Employment
Pennsylvania’s Department of Labor and Industry has ramped up enforcement of child labor laws. Key reminders:
Workers aged 14–17 must receive a 30-minute break after five consecutive hours of work.
Limits apply to hours worked during school terms and vacations.
Employers must maintain proper permits and limit duties to tasks that are age-appropriate.
4. Pending Legislation to Watch
A proposed House Bill would introduce a Pennsylvania-specific WARN Act, requiring 90-day notice of mass layoffs or closures that affect 30 or more employees or 33% of the workforce.
A new Senate Bill proposes mandatory severance pay for affected workers in qualifying layoffs.
While neither has passed as of June 2025, employers should prepare for potential compliance shifts later this year.
Takeaways for Pennsylvania Employers
Audit restrictive covenants in healthcare employment agreements to ensure compliance with the new noncompete ban.
Review payroll procedures for workers’ comp claims to ensure direct deposit capability.
Double-check child labor documentation if you plan to hire minors this summer.
Monitor the progress of the proposed House and Senate Bills and assess their potential impacts on workforce planning.
This mid-year check-in is a reminder that employment law is dynamic and increasingly state-specific. If you operate in multiple jurisdictions or have questions about how these developments apply to your workforce, we recommend scheduling a compliance review or policy audit.
Our Employment Law Team is here to help you navigate these changes and stay ahead of what’s next. Contact us at 215.362.2474 or email Jon Young to get started.