Institutions of Higher Education Can No Longer Establish or Maintain DEI Offices

Texas is one of several states that have implemented laws aimed at eliminating DEI offices and initiatives for publicly funded institutions.

Effective January 1, 2024, Texan institutions of higher education (e.g., the University of Texas) are no longer permitted to establish or maintain diversity, equity, and inclusion (“DEI”) offices or hire/assign employees (or officers or contractors) to perform any DEI-like job duties. Further, Texas institutions may not require applicants or employees to provide DEI statements or give preference to any applicants or employees on the basis of race, sex, color, ethnicity, or national origin. And finally, the law requires these institutions to “adopt policies and procedures for appropriately disciplining, including by termination, an employee or contractor” who violates the law.

There are a few carveouts. Notably, institutions may continue to support first-generation college students, low-income students, or “underserved student populations” for “purposes of applying for a grant or complying with the terms of an accreditation.”

Posting Requirements for State Workplace Violence Hotline Continue

As previously reported in Dykema’s Legal Updates for Texas Employers in 2024, House Bill 915 requires all employers to post notices for the Texas Department of Licensing and Regulation (“TDLR”)’s new 24-hour hotline to report workplace violence. The updated poster was released in January 2024 and can be accessed here. The notice must be posted in (1) a conspicuous place in the employer’s place of business, (2) in sufficient locations to be convenient and accessible for all employees, and (3) in English and/or Spanish, as appropriate for the respective employees.

Employers who have not yet posted the notices should promptly do so in order to avoid compliance penalties.

Texas Court Blocks DOL’s Overtime Rule

The power of administrative agencies in issuing regulations and legal opinions has no doubt been a hot-button issue for 2024. Perhaps the most significant legal challenge out of Texas this past year involves the Department of Labor’s (“DOL”) proposed increased salary thresholds for certain overtime exemptions.

In April 2024, the DOL released its “Overtime Rule,” which would raise the minimum salary levels for the Fair Labor Standards Act (“FLSA”)’s white-collar overtime exemption (the “EAP exemption”). Under the new Overtime Rule, the salary requirement to meet the EAP exemption was increased to $43,888 on July 1, 2024, and was set to increase to $58,656 on January 1, 2025.

On November 15, 2024, a federal Texas Judge issued an order striking down the new Overtime Rule entirely, both retroactively invalidating the July 2024 salary increase and blocking the January 2025 increase. In short, the Judge ruled that the DOL exceeded its authority in issuing the rule based primarily on the impact the new Overtime Rule would have on businesses. For example, the July 2024 increase would have removed approximately one-third of workers who would have previously met the requirements under the EAP exemption.

The ruling vacates the new Overtime Rule nationwide. The DOL has the option to appeal the decision to the Fifth Circuit, though the likelihood of an appeal will be impacted by the incoming Trump administration.

For now, the Overtime Rule remains vacated, and employers can continue classifying employees based on prior regulations and salary thresholds.

For a further summary and update on the White Collar Exemptions under the FLSA, please see the Dykema blog post summarizing the issue here.

Constitutionality of NLRB in Question

The constitutionality of the National Labor Relations Board (“NLRB”) administrative law judges (“ALJs”) has been similarly questioned. Indeed, in two decisions this year, Texas federal courts have granted injunctions, holding that the structure of the NLRB may be unconstitutional. So far, no injunction has applied nationwide, so the NLRB is otherwise free to pursue alleged labor violations against employers. However, given the shifting landscape (and the incoming Trump administration), there will likely be additional, broader updates to come in 2025.

Future of ALJs for Occupation Safety and Health Administration (“OSHA”) Violations in Question

Similarly, in another decision, a federal judge out of the Southern District of Texas issued an opinion questioning the constitutionality of administrative law judges within the various Department of Labor (“DOL”) agencies. Like the NLRB decisions discussed above, this decision was not a nationwide injunction.

Importantly for Texas employers, this decision (including the NLRB decision discussed above) could pave the way for new leverage in administrative disputes, including OSHA and NLRB disputes. However, for now, the impact of this decision will have to play out in the courts.

To learn more about any of the legal topics above and how they impact your business or any other general questions, please contact the authors of this article or your Dykema relationship attorney.