As 2025 begins, employers across the U.S. face various new federal, state, and local compliance requirements. From updates to health care and privacy laws to changes in minimum wage and employee classification, staying informed and proactive is critical. This guide provides an overview of key changes effective January 1, 2025, and actionable steps to ensure compliance.
Federal Compliance Updates
- Mental Health Parity Final Rules – Starting January 1, 2025, the Department of Labor, Health and Human Services, and the IRS will enforce new rules to ensure equitable coverage of mental health services under employer health plans.
- HIPAA Privacy Rule Amendments – Effective December 23, 2024, the HIPAA Privacy Rule prohibits the disclosure of reproductive healthcare-related Protected Health Information (PHI), enhancing employee privacy rights.
State-Specific Compliance Updates
The table below outlines state-specific compliance changes effective January 1, 2025:
State | Compliance Area | Legal Development |
California | Employee Classification | Minimum salary increases to $1,320 per week. |
Independent Contractors | Freelance Worker Protection Act and sunset of exemptions for certain workers. | |
Privacy | Amendments to Consumer Privacy Act, expanding opt-out rights. | |
Paid Family & Medical Leave | Increases to benefits and expanded protections for agricultural workers. | |
Digital Replica Restrictions | Prohibits digital replica usage in employment agreements. | |
Discrimination | Prohibits intersectional and hairstyle-based discrimination. | |
New York | Employee Classification | Minimum salaries for exempt employees increase to $1,161.65–$1,237.50 per week. |
Paid Sick Leave | Expanded to include prenatal leave. | |
Colorado | Employee Classification | Minimum salary for exempt employees increases to $1,086.25 per week. |
Workplace Safety | Stricter rules for mobile device usage while driving. | |
Illinois | Pay Transparency | Pay transparency law and expanded pay statement requirements. |
Discrimination | Protections against family responsibility and reproductive health discrimination. | |
Military Leave | Protections extended to U.S. Space Force members. | |
Personnel Records | Updates to the Personnel Record Review Act. | |
Oregon | Overtime | Agricultural employees are eligible for overtime after 48 hours. |
Paid Family & Medical Leave | Adds new qualifying reasons for leave. | |
Workplace Safety | The Warehouse Worker Protection Law takes effect. | |
Alaska | Employee Classification | Minimum salary for exempt employees increases to $952.80 per week. |
Minnesota | Pay Transparency | Requires job postings to include pay information. |
Wage Theft | Wage theft ordinance in St. Paul. | |
Nevada | Minimum Wage | Limits subminimum wages for job and day-training service providers. |
Delaware | Privacy | Delaware Personal Data Privacy Act takes effect. |
Iowa | Privacy | Iowa Consumer Data Protection Act takes effect. |
Nebraska | Privacy | Nebraska Data Privacy Act takes effect. |
New Hampshire | Privacy | New Hampshire Consumer Data Privacy Law takes effect. |
Download our 2025 compliance guide
Actionable Steps for Employers
To navigate these compliance updates effectively:
- Assess – Pull an employee census file to thoroughly audit your workforce across all jurisdictions to identify applicable compliance changes.
- Update Policies – Revise employee handbooks and employment agreements to reflect new wage requirements, leave, and privacy requirements.
- Train Your Team – Ensure HR personnel, managers, and relevant teams are trained on implementing these updates.
- Stay Informed – Establish ongoing practices to monitor proposed and upcoming labor law changes.
Get started with PEO 360
With over 140 compliance changes—including 60+ minimum wage increases—taking effect on January 1, 2025, proactive planning is essential. Understanding these updates and implementing necessary changes can protect your organization from penalties and foster a compliant, employee-friendly workplace.
For personalized assistance navigating these changes, connect with our team to learn more about our HR services.
Book a Strategy Call