Each month, Optimum HR gathers the latest updates and changes to federal and state employment law. Read on to learn how these changes may affect you, and how Optimum can help you ensure compliance.
Federal Updates
From Images to Liability: Deepfake Policy Lessons Employers Need Now
Artificial intelligence (AI) has made it easier than ever to produce convincing, nonconsensual sexually explicit deepfake images from publicly available photographs. Employers should recognize that misuse of AI to generate fake, sexually explicit, or harassing content can introduce workplace issues and that organizational inaction can create significant legal risk for employers. Read more
New USERRA Poster Released – Employers Should Update Their Workplace Notices
The U.S. Department of Labor has released an updated “Your Rights Under USERRA” poster. If your business displays employment law posters, now is a good time to make sure your USERRA notice is up to date.
USERRA (the Uniformed Services Employment and Reemployment Rights Act) protects the employment rights of individuals who serve in the military, including members of the National Guard and Reserve. The law also prohibits discrimination against employees because of their military service or obligations. Read more
What the DOJ’s Religious Freedom Guidance Means for Private Employers
On July 23, 2026, the U.S. Department of Justice (DOJ) released guidance that, while outlining principles for protecting freedom of religion in the federal workplace, has implications for private employers. Read more
State Updates
Colorado’s New Strict Requirements on Employment Eligibility Verification
Effective June 3, 2026, Colorado revised its law regarding how employers must handle employee government identification documents for employee employment eligibility verification, including by limiting how long employers may retain an applicant’s or employee’s ID documents. Under the previous law, there was no express limitation on the duration of time employers could retain government ID documents for the purposes of employment eligibility verification. Read more
Illinois Enacts Laws Codifying Disparate Impact and Requiring Jury Duty Pay
Illinois Governor JB Pritzker recently signed into law two bills that will impact employers in the state. Senate Bill (SB) 3777, the Civil Rights Safeguard Act, amends the Illinois Human Rights Act (IHRA) to codify into statute disparate impact liability under Illinois law. House Bill (HB) 4844 amends Illinois’ Jury Act, 705 ILCS 305 et seq., to mandate that employers with more than 25 employees compensate employees for the time spent serving on jury duty. Both bills were signed into law on July 31, 2026. Read more
Minnesota Adopts New Rules Clarifying Earned Sick and Safe Time Requirements
Following a multi-year process, the Minnesota Department of Labor and Industry (MNDOLI) adopted rules providing guidance and clarification on Minnesota’s Earned Sick and Safe Time law (“ESST”). The rules went into effect on July 6, 2026. Read more
NJ Labor Department Clarifies Employers’ Obligations for Workers’ Job Protection Under Temporary Disability, Family Leave Insurance Laws
The New Jersey Department of Labor (NJDOL) clarified that based on amendments effective July 17, 2026, the New Jersey Temporary Disability Law provides eligible employees up to 26 weeks of job protection while employees are collecting Temporary Disability Insurance (TDI) benefits and up to 12 weeks of job protection while they are collecting Family Leave Insurance (FLI) benefits.
The Law, signed by then-Gov. Phil Murphy shortly before leaving office, also extended the scope of the New Jersey Family Leave Act by reducing eligibility requirements. Read more
Tennessee Enacts Significant Changes to Non-Compete Law
Effective July 1, 2026, Tennessee has joined a growing list of states that impose statutory restrictions and reasonableness presumptions concerning non-competition agreements. The new Tennessee law (House Bill 1034) implemented two new changes to Tennessee’s non-compete law: (i) it sets forth compensation thresholds for the application of non-compete restrictions, and (ii) it established rebuttable presumptions with respect to the reasonableness of temporal scope of non-compete restrictions. Read more
Washington State Employers Face Major Changes to Background Checks
Employers in Washington State with fifteen or more employees anywhere must comply, as of July 1, 2026, with the Washington Fair Chance Act (WFCA), RCW 49.94, as amended last year in Engrossed House Bill 1747, which significantly restricts when and how employers may conduct criminal background checks, obtain criminal history information, and consider criminal history in hiring and other employment decisions. Employers with fewer than fifteen employees must comply by January 1, 2027. Read more
