Monthly Archives: April 2024

Department of Labor (DOL) Issues its Final Overtime Rule

By: Sean E. Lees

On April 23, 2024, the Department of Labor (DOL) issued its final overtime rule, which raised the annual salary required for certain employees to be exempt from overtime under the Fair Labor Standards Act (FLSA).  While this rule will likely face legal challenges, it is scheduled to go into effect on July 1, 2024.

As a general rule, unless certain exemptions apply, employees who work more than forty (40) hours in a workweek must be paid overtime.  This new rule impacts two (2) exemptions – the executive, administrative, and professional (“EAP”) exemption and the highly compensated employee (“HCE”) exemption.  To qualify for the EAP exemption, the employee must meet three tests: 1) be paid a salary on a predetermined and fixed amount that is not subject to reduction based on the quality or quantity of work performed; 2) be paid at least a specified weekly salary level, and 3) perform primarily executive, administrative, or professional duties.  The HCE exemption applies to employees who are paid a salary, earn above a set annual compensation threshold, and satisfy a minimal duties test.

Effective July 1, 2024, the new rule raises the minimum salary threshold for the EAP and HCE exemptions:

  1. Under the EAP exemption, the minimum salary threshold will be raised from $684 per week ($35,568 per year) to $844 per week ($43,888 per year);
  2. Under the HCE exemption, the annual compensation threshold will be increased from $107,432 per year, including at least $684 per week paid on a salary or fee basis, to $132,964 per year, including at least $844 per week paid on a salary or fee basis.

Effective January 1, 2025, the salary thresholds for these exemptions will again be raised as follows:

  1. The EAP minimum salary threshold will be increased to $1,128 per week ($58,656 per year);
  2. The HCE annual compensation threshold will be increased to $151,164 per year, including at least $1,128 per week paid on a salary or fee basis.

Effective July 1, 2027, and every three (3) years thereafter, these thresholds will be updated based on the available data used to set the salary level in effect at the time of the update.

The practical result of this rule is that many employees currently classified as exempt under the FLSA overtime rules may now fall below the adjusted minimum salary thresholds described above.  Therefore, this subset of newly classified employees must be paid overtime if they work more than forty (40) hours in a given week.  Employers should prepare for the implementation of this rule by analyzing the salaries of all employees currently classified as exempt to determine whether the new rules may alter their classification.  During this analysis, employers should pay particular attention to employees who earn between $35,568 and $58,656 per year, as these employees are most likely to be impacted by this new rule.  Employers may consider adjusting an employee’s salary in accordance with the new rule to maintain their exempt status or otherwise convert them to non-exempt status, at which point they would be eligible for overtime payments.


By:       Sally A. Piefer

Non-compete and non-solicitation agreements are relatively commonplace in the employment context. However, these agreements have been under increasing attack by state legislatures across the country. Shortly after President Biden took office, he issued an Executive Order on Promoting Competition in the American Economy and encouraged the Federal Trade Commission (FTC) to ban or limit non-compete agreements.

The FTC stated in a virtual workshop on competition later that year that it believed non-competes constitute an unfair method of competition. Last January, the FTC announced that it took legal action against three companies, suing them to prevent the use of unlawful noncompete restrictions. See Shortly thereafter, the FTC released a proposed rule which would prohibit all non-compete agreements—except for those between buyers and sellers of a business.

More than 26,000 comments were submitted in favor of and against the proposed rule. Last week, the FTC issued its final rule governing non-compete agreements. Absent a stay in connection with a legal challenge, this final rule is slated to take effect 120 days after the final rule is published in the Federal Register.

The final rule provides that it is an unfair method of competition to (i) enter into or attempt to enter into a non-compete clause; (ii) enforce or attempt to enforce a non-compete clause or (iii) represent that a worker is subject to a non-compete clause.

The final rule defines a “non-compete” as a “term or condition of employment that prohibits a worker from, penalizes a worker for, or functions to prevent a worker from:

  • Seeking or accepting work in the United States with a different person where the work would begin after the conclusion of the employment that includes the term or condition; or
  • Operating a business in the United States after the conclusion of the employment that includes the term or condition.”

The final rule does not prohibit a non-compete during the course of employment and it does not impact the use of non-competes used in connection with the sale of a business setting, or existing lawsuits related to a non-compete clause.

This means that all existing non-competes would be void – with the exception of non-competes for “senior executives” – who are defined as a worker who is in a “policy-making position” and received total compensation from the employment of at least $151,164 in the preceding year. “Policy-making position” means a business entity’s president, CEO or the equivalent, or any other officer of a business who has policy-making authority. Notably, an officer of a subsidiary or affiliate of a business entity that is part of a common enterprise who has policy-making authority for the common enterprise is considered to have policy-making authority, but a person who does not have policy-making authority over a common enterprise may not be deemed to have a policy-making position – even if the person has policy-making authority over a subsidiary or affiliate of a business entity that is part of the common enterprise.

In addition to banning non-compete agreements, the final rule also imposes an obligation on employers to provide affected workers with clear and conspicuous notice to the worker by the effective date that the non-compete clause will not be, and cannot legally be enforced against the individual. The notice must either be hand-delivered or sent by email, regular mail or text message.

The final rule is silent with respect to non-solicitation and confidentiality clauses, so presumably those types of clauses, to the extent they are reasonable, will continue to be enforced under applicable state law.

Within a day of the release of the final rule, at least two lawsuits have been filed in the federal courts in Texas challenging the rule. We anticipate that one (or both) of the courts may likely stay the implementation of the final rule, pending resolution of the litigation. A stay cannot be requested until the final rule is actually published in the Federal Register.

Next Steps? We will continue to follow the pending litigation and provide relevant updates which affect non-competes. However, in the interim, it would be prudent to take an inventory of the agreements you currently have in place with current and former employees and independent contractors and determine whether those agreements contain any non-compete clauses. We recommend that legal counsel determine whether those agreements contain severability language to preserve any non-solicitation, confidentiality or other contractual obligations. You should also review your Employee Handbooks and determine whether they contain any language which could reasonably be considered a non-compete.

If you have questions about the final rule, or any questions about non-compete, non-solicitation and/or confidentiality agreements, please contact Sally Piefer at 414-226-4818 or, or another member of the employment team at Lindner & Marsack.


By:       Alexandra (Sasha) Chepov and Oyvind Wistrom

April 24, 2024

On April 15, 2024, the Equal Employment Opportunity Commission (EEOC) issued its final regulation to carry out the Pregnant Workers Fairness Act (PWFA), which went into effect on June 27, 2023. The regulation will go into effect on June 18, 2024.

By way of background, the PWFA requires covered employers to provide a “reasonable accommodation” to a qualified employees’ or applicants’ known limitations related to, affected by, or arising out of pregnancy, childbirth, or related medical conditions, unless the accommodation will cause the employer an undue hardship. Notably, the PWFA only applies to accommodations.

As the PWFA applies to private and public sector employers that have 15 or more employees, it is critical that employers understand how to navigate the complexities of the PWFA and the accompanying regulation.

What is a “qualified” employee or applicant under the PWFA?

Under the PWFA, employers are obligated to provide a reasonable accommodation to a “qualified” employee or applicant. A pregnant applicant or employee can be “qualified” in two ways:

  1. The employee or applicant can perform the “essential functions,” or fundamental duties, of the job with or without a reasonable accommodation.
  1. If the employee cannot perform the essential functions of the job with or without a reasonable accommodation, an employee may still be “qualified” under the PWFA so long as:
    • The inability to perform the essential function is “temporary,”
    • The employee could perform the functions “in the near future,” and
    • The inability to perform the essential functions can be reasonably accommodated.

If an employee does not satisfy the criteria above, then they are not protected by the PWFA.

What is a “known limitation” under the PWFA?

Under the PWFA, “known limitation” means the employee or their representative has communicated to the employer that they have a “physical or mental condition related to, affected by, or arising out of pregnancy, childbirth, or related medical conditions.” While the burden is on the employee to notify their employer of a limitation covered by the Act, they need not use any specific language to do so.

The regulation provides the following examples of a “pregnancy, childbirth, or related medical condition:” pregnancies, vaginal deliveries or cesarian sections, miscarriage, postpartum depression, edema, placenta previa, and lactation.

The regulation also provides that an employer may also need to provide reasonable accommodations for an employee’s or applicant’s known limitations relating to abortion. Further, an employee does not need to be pregnant to be covered by the PWFA’s coverage. The regulation provides that accommodations for an employee’s physical or mental conditions related to, affected by, or arising out of infertility and fertility treatments may be protected under the PWFA, absent undue hardship. However, whether a reasonable accommodation must be provided to an employee undergoing fertility treatments depends on the facts of the case, including whether the infertility treatments are sought by an employee with the capacity to become pregnant for purposes of becoming pregnant.

Similar to the mandate of the Americans with Disabilities Act (ADA), once an employer knows of a limitation covered by the PWFA, the employer should engage in an “interactive process” with the employee or applicant to determine whether a reasonable accommodation can be provided.

What is a “reasonable accommodation” under the PWFA?

As with most federal discrimination laws, a “reasonable accommodation” is a change in the work environment or the manner in which things are typically done at work. Given the evolutionary nature of a pregnancy, generally spanning 40 weeks, a qualified employee or applicant may need different accommodations at various times throughout the pregnancy or after birth.

Whether an accommodation is “reasonable” is largely a case-by-case determination. However, an employer does not have to provide a reasonable accommodation under the PWFA if doing so would cause the employer an “undue hardship.” An “undue hardship” under the PWFA means a significant difficulty or expense.

While there are many accommodations that may exist, the regulation provides the following examples of potential accommodations that may need to be provided to a qualified employee under the PWFA:

  • Providing additional, longer, or more flexible breaks to drink water, eat, rest, or use the bathroom.
  • Changing equipment, devices, or workstations, such as providing a stool to sit on, or a way to do work while standing.
  • Changing a uniform or dress code or providing safety equipment that fits.
  • Changing a work schedule, such as having shorter hours, part-time work, or a later start time (likely to accommodate morning sickness).
  • Temporarily reassigning the employee to a different position.
  • Temporarily suspending one or more essential functions of a job.
  • Offering light duty work or help with lifting or other manual labor.

Notably, employers covered by the PWFA, may be required to provide an employee leave to recover from childbirth or other medical conditions related to pregnancy or childbirth, even if the employer is not covered by the federal Family Medical Leave Act.

Next Steps 

While the passage of these PWFA and the EEOC’s corresponding regulation expand the rights and protections afforded to pregnant employees or applicants, employers now bear the burden of navigating additional requirements and restrictions. The purpose of this informational notice is to provide a brief overview of that provided in the regulation. However, it is not all encompassing.

As the effective date of the regulation corresponding to the PWFA is approaching, employers should consider implementing a policy pertaining to reasonable accommodations for pregnant workers, and revising their current policies that may be affected by the PWFA.

If you have any questions regarding the PWFA or the EEOC’s corresponding regulation, please contact Alexandra (Sasha) Chepov or Oyvind Wistrom at 414-273-3910 or and, or any other attorney that you have been working with here at Lindner & Marsack, S.C.


SCOTUS Eases the Standard for Proving a Discriminatory Job Transfer under Title VII

By: Oyvind Wistrom

Earlier this week, the U.S. Supreme Court resolved a split in the circuits as to whether an employee is required to show a “significant” injury or harm in connection with a job transfer to meet the threshold for proving an adverse employment action under Title VII of the Civil Rights Act of 1964.  The Court rejected the “significant” injury standard, and adopted a new standard that only requires an employee who is involuntarily transferred from one position to another to show that he/she suffered some harm to satisfy the adverse employment action prong of his/her case.

The case was brought by Jatonya Muldrow, a police sergeant who claimed she was transferred from her job as a plainclothes police officer in the intelligence section of the St. Louis Police Department because she was a woman.  Muldrow worked in the Intelligence Division from 2008 until 2017, where she investigated public corruption and human trafficking cases.  She also oversaw the Gang Unit, served as head of the Gun Crimes Unit, and was assigned as a task force officer with the FBI.  Despite her high employment evaluations, a new unit commander transferred her out of the Intelligence Division, justifying the transfer, in part, by noting that the division’s work was “very dangerous.”  Over her objections, Muldrow was reassigned to a uniformed job in another district where she supervised the activities of neighborhood patrol officers — approving arrests, reviewing reports and handling other administrative matters.

Though her pay and rank remained the same, Muldrow sued the police department, asserting that she had been harmed by the transfer.  Because she was no longer in the Intelligence Division, she lost her FBI status and the car that came with it, and in the new job Muldrow often had to work nights and weekends, instead of the Monday-through-Friday workweek she had worked in the intelligence unit.

Although the district court and the court of appeals both granted summary judgment for the police department, the Supreme Court reversed and remanded the case noting that the words “discriminate against” contained in Title VII refer to “differences in treatment that injure” an employee.  In a typical transfer case, that worse treatment may involve a reduction in pay or benefits, but such economic or tangible effects are not necessarily required where the employee can show that the transfer resulted in some harm.  Writing for the Court, Justice Elena Kagan explained that as long as an employee can show some harm because of sex, race, religion or national origin, that is enough. “Had Congress wanted to limit the liability for job transfers to those causing a significant disadvantage, it could have done so,” wrote Kagan, adding that the court “does not get to make that judgment” by rewriting the statute.

This decision represents a sharp departure from the previous standard that had been followed by the Seventh Circuit Court of Appeals, which covers Wisconsin, Indiana and Illinois.  All employers covered by federal anti-discrimination laws must now be careful to ensure that employment transfers that could be shown to be motivated by the employee’s membership in a protected class do not result in any harm or diminution in responsibilities or status as to avoid liability under Title VII.