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Compliance Updates – January 2024
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January 22, 2024

Happy New year! With the new year comes new Connecticut regulatory and compliance updates, as well as some potential federal developments that all employers must be aware of.

Minimum Wage

The minimum wage in Connecticut is now $15.69 per hour, increasing from $15 per hour as of January 1. Some may ask – “didn’t the minimum wage just go up less than a year ago”? And the answer is yes. But, in Connecticut the minimum wage is now connected to the U.S. Department of Labor’s calculation of the employment cost index. This will occur for the twelve-month period ending on June 30 of the preceding year. This change was made due to a bill enacted and signed into law by Governor Lamont in 2019. Depending on this index, Connecticut’s minimum wage may change each January 1.

Unemployment Compensation

Connecticut’s unemployment program has changed, effective January 1, on a number of fronts. One is that the taxable wage base increases from the first $15,000 per employee to the first $25,000. Another is that the minimum unemployment tax rate decreases from .5% to 0.1% with the maximum rate increasing from 5.4% to 10%. And yet another is that when someone claims unemployment and they received/are receiving a severance payment, they will no longer receive unemployment compensation until that severance payment timeframe has come to an end.

Connecticut Sick Leave

The Connecticut Sick Leave regulation was changed to include a mental health wellness day – effective October 1, 2023. What this means is that when an employee requests a sick day for mental health wellness, the employer must comply if they are a private or public employer that employs at least 50 employees, and their employees meet the definition of “service worker.”

Prepare for new Independent Contractor Rules

The federal Department of Labor (DOL) has announced that a final rule will take effect on March 11, 2024 which update’s the DOL’s interpretation of what constitutes an independent contractor.

In both 2017 and 2019 I authored blogs on the complicating factors and tests to determine whether an independent contractor is truly independent or is really an employee.  

To add to this, we now have a new rule, effective in March regarding this determination, and this also rescinds a previous rule:

The DOL has now identified six (6) factors when one would be examining the work relationship between an employer or potential employer and the worker:

  • The worker’s opportunity for profit or loss
  • What investments are made by both the worker and the potential employer?
  • What is the degree of “permanence” of the relationship between the worker and the potential employer?
  • The degree and nature of control of the work
  • Is the work performed an “integral” part of the potential employer’s business?
  • The extent of the worker’s initiative and skill

As of the date of this blog, there are at least two business groups that have filed suit opposing this new rule. 

Prepare for potential new Overtime Requirements

The federal DOL is in the process of determining a new overtime threshold to be used when determining if a job is exempt or non-exempt. Currently, the minimum salary threshold stands at $684 per week or $35,568 annually. The proposed increases:

  • Increase the threshold to $1,059 weekly, or $55,068 annually.
  • Raising the highly compensated requirement to exempt highly compensated employees from $107,432 to $143,988.

It appears that the DOL will issue the final rule in April of this year, and that final rule would become effective 60 days later.

We at KardasLarson are ready to assist employers in preparing for this and other regulations and compliance changes. Contact us with any questions.

Nick Daukas

Nick Daukas

Author

With 30+ years of HR experience Nick specializes in ER, OD, Recruitment and Legal Compliance. He has an MBA and holds advanced HR certifications SPHR, SHRM-SCP.

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