Compliance Stuff

Here are five (5) questions that are fairly simple but revealing as to whether a company’s Sanctions Compliance Program (“SCP”) is effective.  This is not an exhaustive list but it is my top 5. Question 1 — Does the Company conduct annual sanctions compliance training for relevant employees? I have written about this and reminder everyone since 2019 about the importance of conducting sanctions training.  OFAC’s Sanctions Compliance Guidance issued in 2019 mandates, at a minimum, that companies provide annual sanctions compliance training.  Notwithstanding this directive, which is reinforced by compliance professionals (including me), most companies are not offering annual sanctions compliance training.  I cannot understand why companies are ignoring this requirement.  Several States require annual training on sexual harassment and other topics.  Companies are able to meet this requirement, but when it comes to sanctions compliance, companies lack the commi...

SIM-swapping attacks targeting executives are on the rise. In 2023, the FBI investigated 1,075 SIM-swapping attacks, which resulted in nearly $50 million in losses. SIM swapping has become so pervasive that it has prompted the Federal Communications Commission to consider strengthening regulatory actions for protecting consumers and businesses as it relates to this attack vector.  Criminals increasingly target senior-level executives in an attack that can impact their corporate and home office environments and even extend to family members. In this article, we will cover the mechanics of SIM-swapping and what executives need to know to mitigate this risk.  What Is a SIM Card? SIM is an acronym for a subscriber identity module, which is smart card or a unique identifying number (e-SIM) and acts as the key to a user's cellular network. It stores information like the unique identification number, the users contacts, and other data, and activates calling, texting, and data serv...

Several state and local minimum wage rates will soon increase, beginning on July 1, 2024. This article provides the state and major locality minimum wage increases for mid-2024 only, along with related changes in the minimum cash wage for tipped employees where applicable. The new rates are in bold text. NOTE: Jurisdictions that will not have—or have not announced—upcoming midyear increases in their minimum wage rates are not included below. This list includes the major localities with minimum wage rates that will increase in mid-2024. It is not exhaustive of all localities nationwide that have a minimum wage rate that may differ from the federal or state rate. Additionally, if a jurisdiction’s minimum cash wage for tipped workers is changing in mid-2024, it is included in the list below. MID-2024 MINIMUM WAGE INCREASES (State and Major Locality) *All the increases shown below will be effective on JULY 1, 2024, unless noted otherwise. CALIFORNIA Berkeley $18.07 to $18.67 Emeryville $18...

On the eve of the effective date of the Equal Employment Opportunity Commission’s (EEOC’s) final Pregnant Workers Fairness Act (PWFA) regulations (Final Rule), a federal court in Louisiana postponed the effective date of what the court describes as the “Final Rule’s requirement that covered entities provide accommodation for the elective abortions of employees that are not necessary to treat a medical condition related to pregnancy” until final judgment is entered in pending litigation. State of Louisiana v. EEOC, et al., No 2:24-cv-00629 (W.D. La. June 17, 2024), and U.S. Conference of Catholic Bishops v. EEOC, et al., No. 2:24-cv-00691 (W.D. La. June 17, 2024). The order may impact employers with employees in Louisiana and Mississippi. PWFA The PWFA was permanent legislation included in the Consolidated Appropriations Act of 2023 signed by President Joe Biden on Dec. 29, 2022, and went into effect on June 27, 2023 . The law requires employers (including state government employers) w...

Plan sponsors are required to file their Form 5500 series returns for 2023 calendar year plans by July 31, 2024 . File a Form 5558 , Application for Extension of Time to File Certain Employee Plan Returns, if you need more time to file your Form 5500 series return, or Form 8955-SSA. A one-participant plan or a foreign plan required to file an annual return must file Form 5500-EZ: Electronically using the Department of Labor’s EFAST2 filing system , or  On paper with the IRS. If you’re required to file at least 250 returns of any type with the IRS, you must file your 2023 Form 5500-EZ and 2023 Form 8955-SSA electronically. See the Form 5500 Corner for more filing information. All plan sponsors are encouraged to file their 2023 Form 5500-EZ electronically. It’s safe, easy to complete and you have an immediate record that the return was filed. Plans Retroactively Adopted After the End of the Plan Year If an employer adopts a plan during the employer’s 2024 taxable year (but not lat...

This week, Senator Patty Murray (D-WA) and Representatives Bobby Scott (D-VA) and Jerrold Nadler (D-NY) reintroduced the Restoring Justice for Workers Act (S. 4502 / H.R. 8691). The bill would prohibit pre-dispute agreements to arbitrate workplace claims, overturn the Supreme Court’s 2018 decision in Epic Systems by banning class action waivers, and establish certain notice and waiting period requirements for post-dispute arbitration agreements. The bill is yet another effort to prohibit or limit the arbitration of workplace disputes. At this time, however, the bill does not appear to enjoy the bipartisan popularity of the Protecting Older Americans Act of 2023 (S. 1979). Source(s) : Ogletree Deakins , received on June 17, 2024; senate.gov , accessed on June 20, 2024; Ogletree Deakins , accessed on June 20, 2024; congress.gov , accessed on June 20, 2024.

 The U.S Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) enforces the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended (VEVRAA). Under VEVRAA, federal contractors and subcontractors are prohibited from engaging in discrimination in employment practices against veterans and required to provide equal employment opportunity in recruiting, hiring, promoting, and retaining protected veterans.    OFCCP continues to release new resources to help contractors understand their obligations under VEVRAA. Published today is a new example illustrating the use of the VEVRAA national benchmark, which is a yardstick contractors use to measure their progress toward achieving equal employment opportunity for protected veterans. OFCCP also published an updated VEVRAA Affirmative Action Program (AAP) sample . The update includes additional information for contractors on how to use the hiring benchmark effectively to monitor their veteran hiri...

Beginning July 1, 2024, Cook County’s minimum wage increases to $14.05 per hour for non-tipped workers while the base wage for tipped workers remains at $8.40 per hour.   Background on Cook County’s Minimum Wage Ordinance The Cook County Board of Commissioners originally passed the Cook County Minimum Wage Ordinance ( MWO ) on Oct. 26, 2016.  The MWO first raised the minimum wage to $10.00 per hour on July 1, 2017. Then, the minimum wage incrementally increased every year until it reached $13.00 on July 1, 2020. In the years since, Cook County’s wage requirements continue to adjust annually in proportion to the increase in the Consumer Price Index for All Urban Consumers, capped at 2.5%.   The Cook County Commission on Human Rights is required to issue a notice by June 1st announcing the updated wage rates that will take effect the next month. Accordingly, on May 30, 2024, Cook County announced the minimum wage update on July 1, 2024, to $14.05 for non-tipped w...

 On June 2, 2024, cloud service provider Snowflake reported increased cyber threat activity targeting some of its customers' accounts. Snowflake recommended that customers review unusual activity to detect and prevent unauthorized user access. The Cybersecurity and Infrastructure Agency (CISA) then sent an alert on June 3, 2024, recommending that Snowflake customers “hunt for malicious activity, report positive findings to CISA, and review the Snowflake notice” on steps to take.   On June 10, 2024, Mandiant provided additional information about the incident. If you are a Snowflake user, the Mandiant Alert is a mandatory read. According to Mandiant, it identified a campaign by threat actor UNC5537, targeting “Snowflake database instances with the intent of data theft and extortion.” The threat actor is suspected of having stolen records from Snowflake customers using stolen customer credentials and subsequently advertised the sale of customer data attempting to extort Snow...

Puerto Rico’s minimum wage will increase to $10.50 per hour from $9.50 per hour effective July 1, 2024. This increase was finally approved by the Minimum Wage Review Commission on June 13, 2024 . With limited exceptions, the increase will apply to all non-exempt employees covered by the Fair Labor Standards Act. This increase was adopted by Act No. 47-2021 as an automatic increase unless the Commission provided otherwise. The Commission’s approval was supported by an economic report issued by Abexus Analytics on June 7, 2024. The report included an analysis based on the data collected in the quarterly returns of the Department of Labor of Puerto Rico, the Quarterly Census of Employment and Wages (ES-202), the aggregated data from the corporate income returns from the Department of the Treasury of Puerto Rico, and the inflation rate, among other factors. An evaluation of the report moved the Minimum Wage Review Commission to approve, with a majority of votes, the minimum wage increase ...

 The U.S. Supreme Court issued a decision directing district courts to use the traditional four-part test when evaluating whether a preliminary injunction should issue at the request of the National Labor Relations Board pending litigation of a complaint under the  National Labor Relations Act. No. 23-367 (June 13, 2024). The decision settles the split among the federal circuit courts over the standard that should be applied when the Board files a motion for a “10(j)” injunction, named for the section of the Act that authorizes the Board to seek injunctive relief. Circuit courts were split on which test should apply: the traditional four-part test, a more lenient two-part test, or a hybrid of the two. The Court’s decision raises the bar for the Board, requiring it to meet each prong of the four-part test for a court to grant an injunction . In particular, it will be more difficult for the Board to establish it is “likely to succeed on the merits,” as opposed to the more leni...

Washington state law just changed in a way that might have made your company’s non-solicitation agreements unenforceable and illegal. Recent amendments to the state non-compete statute took effect on June 6 and significantly changed both the statute and existing case law when it comes to which non-solicitation agreements can be enforced by employers. The new law also broadens the definition of prohibited non-compete agreements. You will need to re-visit your employment agreements to ensure they are compliant with the amended statute. Quick Background on the Washington Statute Washington’s non-compete statute has been in effect since 2020. To be valid and enforceable under the law, such an agreement must: Disclose the terms of the agreement before employment begins, or else be accompanied by independent consideration; Allow for adjudication of disputes in Washington (choice of law provisions for other states render the agreement void); and Involve an employee earning overcompensation fl...

The FTC's proposed ban on non-compete agreements is still making its way through the legal system, but businesses are already looking for alternatives to protect their interests. Keep in mind that it is not necessarily the employee you want to prevent from joining a competitor – although the loss of a good employee is always a hit – rather, it’s the trade secret you want to keep safe. Here are some alternatives to non-compete agreements that help you do just that: Stronger Trade Secret Protections There are state and federal laws in place to protect your trade secrets. In Texas, the Texas Uniform Trade Secrets Act, or TUTSA, protects “all forms and types of information, including business, scientific, technical, economic, or engineering information, and any formula, design, prototype, pattern, plan, compilation, program device, program, code, device, method, technique, process, procedure, financial data, or list of actual or potential customers or suppliers, whether tangible or int...

Employers, take warning! A federal judge in Illinois refused this week to dismiss a class action lawsuit brought under the Americans with Disabilities Act based on a "voluntary" wellness program. Employers should review their wellness programs and determine whether any monetary incentives for participation are so sweet that employees may feel they have no choice but to participate. If so, then the program may not be "voluntary," and any requests for medical information in connection with the program could run afoul of the ADA. ADA review In addition to prohibiting discrimination based on disabilities and requiring reasonable accommodations, the ADA has some significant provisions relating to employees' medical information. Those provisions apply to all employees, not just employees with disabilities. Here is the quick and dirty: An employer cannot request medical information from an applicant before a conditional offer of employment has been made. Period. After ...

The Office of Federal Contract Compliance Programs (OFCCP) just released its 2024 Corporate Scheduling Announcement List (CSAL), which identified 500 establishments of supply and service contractors that have been selected for an upcoming audit. Federal contractors and subcontractors should immediately examine the list, which was just released last Friday, to determine if one or more of your establishments have been identified for such an audit. This Insight explains how to find out if you’ve been selected, summarizes the scheduling methodology in more detail so you can learn why you were chosen, and provides a seven-step plan for responding. How Can We Find Out If We’ve Been Selected for Audit? You should immediately review the 2024 Corporate Scheduling Announcement List (CSAL)  by clicking on this link and choosing “FY 2024 CSAL Supply & Service Scheduling List.” Doing so will generate an Excel document as a downloadable file, which contains the actual list. What Should Contr...

The California Civil Rights Department (CRD) has released new proposed regulations regarding employers’ use of artificial intelligence (AI) and automated decision-making systems that would affirm that the use of such technology in a way that discriminates against employees and job applicants based on protected characteristics is a substantive violation of California law. The California Civil Rights Department released new proposed regulations for employers’ use of AI and automated decision-making systems. The proposed regulations would affirm that employers’ use of such hiring technologies may violate the state’s antidiscrimination laws and clarify limits on the use of such technology in criminal background checks and medical/psychological inquiries. The proposed regulations would also clarify the scope of third-party liability arising from the use of AI tools. Written comments on the proposed regulations must be submitted by July 18, 2024. On May 17, 2024, the Civil Rights Council, a ...

The proper classification of employees as exempt or non-exempt is often at the root of wage and hour litigation, and there are many common misunderstandings about the subject. Below are some of the questions SLG attorneys most frequently receive about employee classification: Q: Are all salaried employees exempt? A: No! Although many use the word “salaried” as synonymous to “exempt,” the analysis is significantly more complicated. Most California exemptions require employees to be paid at least double minimum wage on a salary basis and to be primarily engaged in exempt duties, which are specifically defined for each exemption. Some exemptions have a higher salary threshold, such as certain physicians and computer professionals, and there are different rules for some commissioned salespeople. Q: Do California employers need to worry about the U.S. Department of Labor’s recently released Overtime Rule? A: Mostly likely no. Under the new Overtime Rule, effective July 1, 2024, the minimum ...

 For years, Department of Justice officials have stressed how important chief compliance officers are as the first line of defense in fighting corporate crimes. While that’s true, compliance programs now have a competitor in the DOJ itself . This article provides an overview of the DOJ’s new whistleblower rewards pilot program and the Criminal Division’s voluntary self-disclosure (VSD) pilot program for individuals, as well as their criteria to participate. This article further discusses what the real-world application of these pilot programs means for compliance programs. Expected to take effect later this year, the whistleblower rewards pilot program was first announced by Deputy Attorney General Lisa Monaco in March at the American Bar Association’s 39th National Institute on White Collar Crime event. In her remarks, DAG Monaco noted that the whistleblower rewards pilot program will expand the scope of other agencies’ whistleblower programs, including the Securities and Exchang...

 Introduction This is a follow-up to our May 9, 2023, alert regarding the Pregnant Workers Fairness Act (PWFA) which went into effect on June 27, 2023 . Congress required the Equal Employment Opportunity Commission (EEOC) to issue regulations under the PWFA. The EEOC has done just that by issuing its final rule and interpretive guidance which goes into effect on June 18, 2024. This alert outlines employers’ duties under the new law, provides clarity on pregnant workers’ rights and protections, and guides employers on ways to minimize risk and liability under the PWFA. What is this law? Covered entities are required to make reasonable accommodations to qualified employees or applicants who have known limitations related to pregnancy, childbirth, or related medical conditions, absent an undue hardship to the business. Who is a covered employer or entity? The PWFA applies to both private and public sector employers that have 15 or more employees. It also applies to Congress, Federal a...