Wage Transparency Act of 2024 – D.C. Act 25-367
On January 12, 2024, the Mayor of Washington, D.C., signed DC Act 25-367, amending the Wage Transparency Act of 2014 (the “Act”) to require private employers to include salary information in job postings and prohibit them from asking applicants about salary history.
The Act and its amendments took effect on June 30, 2024. Employers in Washington, D.C., are now required to include minimum and maximum projected salary or hourly pay information that the employer, in good faith, believes at the time of the posting, for all job advertisements or postings.
Further, Washington, D.C., employers will need to disclose the existence of healthcare benefits before the first interview. Washington, D.C., employers cannot prevent employees from discussing their wages with others nor discipline employees who inquire about or discuss their wages or the wages of others.
Lastly, employers will be prohibited from screening prospective employees based on their wage history or seeking the wage history of a prospective employee.
Employers should review and update their current and future job postings and interview process in order to comply with the statute and amendments.
D.C. Cannabis Employment Protections Amendments
The Cannabis Employment Protections Amendment Act, D.C. Law 24-190, has been in effect since July 13, 2023, and has imposed new obligations on private employers.
Under the statute, Washington, D.C., employers are prohibited from taking adverse action (termination, suspending, demoting, refusing to hire, failing to promote, or otherwise penalizing) against an individual for cannabis or marijuana use off-premises during non-work hours. For drug testing under the statute, employers should know that the presence of cannabinoid metabolites in an employer-required or requested drug test can be used to justify adverse action if the employee is impaired by the use of cannabis at the place of employment or during work hours.
The notice and administrative requirements for any alleged claims have also changed. For example, employees must report alleged non-compliance to the D.C. Office of Human Rights within one year. Moreover, recreational marijuana users must exhaust their administrative remedies under the statute before bringing a private cause of action. While medical marijuana patients are not required to exhaust administrative remedies, they cannot bring a private cause of action directly to the court if they have initiated an administrative complaint with the D.C. Office of Human Rights alleging the same non-compliance.
Employers can also be penalized for non-compliance with the statute, such as paying civil penalties (i.e., 1–30 employees, up to $1,000 per violation; 31–99 employees, up to $2,500 per violation; and 100+ employees, up to $5,000 per violation). Penalties could also be doubled if the employer is found to be non-compliant in the past year. Employers could also be required to pay the employee’s lost wages and compensatory damages, undergo training or any other equitable relief to undo the adverse employment action, and pay reasonable attorneys’ fees and costs.
D.C. employers should amend their workplace designations and policies in accordance with the changes mandated by the statute.
D.C. Non-Compete Clarification Amendment Act of 2022 – Highly Compensated Employee Salary Threshold Increase
The Washington, D.C., non-compete act, D.C. Law 24-175, has been in effect since October 2022. As a reminder, the law makes it illegal for employers to impose noncompete clauses and policies (non-compete agreements) on employees for “covered employees” but allows non-competes with highly compensated employees that meet certain drafting and procedural requirements. The law does not prohibit non-competition provisions with the seller of a business, otherwise lawful confidentiality provisions, or certain anti-moonlighting provisions.
The Act broadly applies to all “employers,” defined as any individual, partnership, general contractor, subcontractor, association, corporation, or business trust operating in D.C., or any person or group of persons acting directly or indirectly in the interest of an employer operating in D.C. in relation to an employee. The definition includes prospective employers but excludes the D.C. and United States governments.
A “covered employee” is defined as an employee who is not a “highly compensated employee” and (1) spends more than 50 percent of his or her work time for the employer working in D.C. or (2) whose employment for the employer is based in D.C. and the employee regularly spends a substantial amount of his or her work time for the employer in D.C. and not more than 50 percent of his or her work time for that employer in another jurisdiction. This definition also includes new hires who have not yet started work if the employer reasonably anticipates that they will fall into either of the categories above.
The following categories of people are excluded from the non-compete ban and, therefore, can still be bound by non-competition provisions: (1) highly compensated employees; (2) casual babysitters in or about the residence of the employer; (3) partners in a partnership; and (4) D.C. and federal government employees.
Most relevant going into 2025 is that the compensation threshold has changed. Previously covered employees who earned more than $150,000 could only be subject to a one-year non-compete agreement (only if notified). However, medical specialists who earned over $250,000 per year could be subject to a two-year non-compete agreement.
Beginning January 1, 2024, these thresholds increased each year based on increases in the Department of Labor’s Consumer Price Index for All Urban Consumers in the Washington Metropolitan Statistical Area. For 2024-2025, the threshold has been set and increased to $154,200 or less for covered employees and $257,000 or less for medical specialists.
Employers face stiff penalties for non-compliance or violations of the statute and its requirements. First, the agreement could be found void and unenforceable, plus there are potential administrative and civil penalties for violations; for example, administrative penalties between $350 and $1,000 for each violation. and civil penalties between $250 and $2,500 for each violation, depending on the violation, or at least $3,000 for certain subsequent violations.
As has been known, all D.C. employers should review their non-competition agreements and written policies to ensure compliance with the statute, including its notice, recordkeeping, and other requirements.
Minimum Wage Increase – D.C. Code § 32-1003
Effective July 1, 2024, pursuant to D.C. Code § 32-1003, the base minimum wage for all Washington, D.C., employees under federal law will increase from $17 to $17.50 per hour for all workers, regardless of the size of the Washington, D.C., employer.
The minimum wage for tipped employees will also increase from $8 to $10 per hour; however, if an employee’s hourly tip earnings added to the base minimum wage do not equal D.C.’s full minimum wage, the employer must pay the difference.
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.