IRS Issues Standard Mileage Rates for 2024
Beginning January 1, 2024, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:
- 67 cents per mile driven for business use (up 1.5 cents from 2023).
- 21 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces (a decrease of 1 cent from 2023).
- 14 cents per mile driven in service of charitable organizations (same as the 2023 rate).
Standard mileage rates are used to calculate the deductible costs of operating a car for business, charitable, medical, or moving purposes. The rates apply to vehicles that are electric, hybrid-electric, gas, and diesel-powered.
On September 8, 2023, the federal Department of Labor (DOL) announced the release of its proposed rule to increase the minimum salary required for certain employees to be classified as exempt from minimum wage and overtime. The proposal seeks to increase the current statutory threshold of $684 per week to $1,059 per week for administrative, executive, and professional exemptions. This would increase annual salary minimums from $35,568 to $55,068 for those employees to be exempt from overtime pay.
Interestingly, the DOL set the measurement for determining the minimum salary threshold based on the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census Region (currently the South). To arrive at the proposed number, the DOL used data from 2022, but indicated it would use the most recent data available when it issues the final rule. This could result in an even higher minimum salary threshold for exempt employees.
In addition, employees who are exempt under the highly compensated employee (HCE) exemption, which has its own specific criteria, must be paid at least $107,432 per year. The proposed rule, if adopted as-is, would increase this amount to require that HCE employees be paid at least $143,988 per year to be classified as exempt.
Finally, the proposed rule, if adopted in its current form, would implement automatic updates to the EAP salary level and HCE total annual compensation requirement every three years.
The 60-day public comment period regarding the proposed rule closed on November 7, 2023. The DOL will now review all received comments before determining whether to make any changes to the proposal. A final rule will eventually be announced, and it will go into effect within a few weeks of publication. Considering all of these steps, a final rule is not expected to be in place until 2024. Additionally, litigation challenging the rule will also likely be filed, potentially further complicating the timeline.
Resourcing Edge will continue to monitor the situation and share developments as they occur.
On March 20, 2023, the Consumer Financial Protection Bureau (CFPB) issued a final rule which, among other things, updates their Summary of Your Rights Under the Fair Credit Reporting Act (FCRA) and replaces the 2018 version. The summary details the major rights guaranteed under the act. For instance, employers that use a credit report to deny employment must provide the applicant with the name, address, and phone number of the agency that provided the credit report information. The final rule also makes non-substantive changes to the act to include removing outdated business references.
The final rule is effective April 19, 2023, but the mandatory compliance date is March 20, 2024.
The new Form I-9 (Rev. 08/01/23) was made available for employers to use no later than November 1, 2023. Employers can also order paper copies if they don’t want to use the electronic version. The version date, noted in parenthesis, can be found in the bottom corner of the Form I-9.
Qualified employers are allowed to conduct Form I-9 remote documentation verification for any employee hired on or after August 1, 2023. Employers need to follow specific steps to remotely verify Form I-9 documents—USCIS has dubbed this the alternative procedure.
If an employer offers the alternative procedure at a particular hiring site, it needs to be offered to all employees at that site. There is an exception, however, if employers want to offer the alternative procedure only to remote employees and do in-person inspection for onsite and hybrid employees. Employers can’t choose when to use remote or in-person verification based on a person’s or group of employees’ citizenship or immigration status, national origin, or any other protected characteristic.
The Meaning of Qualified Employer
Qualified employers are those that are participants in good standing in federal E-Verify. Employers are in good standing if all of the following are true:
- They have enrolled in E-Verify for all hiring sites in the United States that use the alternative procedure
- They are compliant with all E-Verify program requirements
- They continue to be enrolled in E-Verify and in good standing at any time when they use the alternative procedure
Alternative Procedure Steps
An employer needs to take the following steps within three business days of an employee’s first day of employment:
- Receive and examine copies of the employee’s Form I-9 documents (or an acceptable receipt) and determine if the documents appear to be genuine. If the documents are two-sided, employers need to examine copies of both the front and back.
- Conduct a live video meeting with the employee. The employee needs to bring the same documents that they sent to the employer so the employer can ensure that they reasonably appear to be genuine and relate to the employee.
- Check the box on Form I-9 (Rev. 08/01/23) that an “alternative procedure” was used to examine documentation to complete Section 2 or reverification. If an employer is using the old form (Rev. 10/21/19), they should write “alternative procedure” in the Additional Information field in Section 2.
- Retain clear and legible copies of all documents that the employee sent to complete Form I-9, regardless of whether the documents are from List A, List B, or List C.
Employers can’t require employees to use the alternative procedure if they don’t want to and will need to perform an in-person examination for those unable or unwilling to participate in the remote verification process. This could arise when new employees don’t have access to the necessary technology or are uncomfortable transmitting sensitive personal information electronically, particularly if the employer hasn’t provided a secure way for them to do so.
The Alternative Procedure and COVID-19 Flexibilities
Qualified employers can use the alternative procedure to satisfy the requirement to physically examine Form I-9 documentation that was examined remotely under the COVID-19 flexibilities, but only if all of these conditions are met:
- They were enrolled in E-Verify at the time the remote examination for a new hire or a re-verification occurred.
- They created an E-Verify case for the employee, except in the case of a re-verification.
- They performed the remote inspection between March 20, 2020, and July 31, 2023.
Employers should follow the alternative procedure steps and write “alternative procedure” and the date of the live video meeting on the Form I-9 in Section 2 in the Additional Information box or the section used for re-verification, whichever applies. They should not create a new case in E-Verify.
On July 26, 2023, the U.S. Equal Employment Opportunity Commission (EEOC) updated its Visual Disabilities in the Workplace and the Americans with Disabilities Act guide that explains how the Americans with Disabilities Act (ADA) applies to job applicants and employees with visual disabilities. It outlines when an employer may ask an applicant or employee questions about their vision, how an employer should treat voluntary disclosures about visual disabilities, and what types of reasonable accommodations those with visual disabilities may need in the workplace.
The updated guide also:
- Highlights new technologies for reasonable accommodation and how using artificial intelligence and algorithms to make employment decisions can impact individuals with visual disabilities;
- Addresses how an employer should handle safety concerns about applicants and employees with visual disabilities;
- Addresses how an employer can ensure that no employee is harassed because of a visual disability; and
- Discusses harassment and retaliation.
Title VII of the Civil Rights Act requires that employers with 15 or more employees make reasonable accommodations for employees’ religious practices and beliefs, so long as it doesn’t cause an undue hardship.
Previously, undue hardship—as it applied to religious accommodations—meant “more than a de minimis cost.” As of June 29, 2023, the Supreme Court has now reinterpreted undue hardship in this context to mean “a substantial increased cost in relation to the conduct of [the employer’s] particular business.”
While the term substantial isn’t defined, the Court said employers should consider the requested accommodation and its practical impact relative to the nature, size, and operating costs of their business. Note that even under the old de minimis standard, the EEOC indicated in the federal regulations that undue hardship wasn’t likely to be caused by temporary costs, voluntary or occasional shift swapping, or administrative costs.
The bottom line is that this new interpretation will make it more difficult for employers to deny religious accommodations on the basis of undue hardship. As a result, you should plan to grant most requests unless you’re certain you can show substantially increased costs.
Effective June 27, 2023, employers with 15 or more employees must provide pregnancy-related accommodations to employees and applicants under the federal Pregnant Workers Fairness Act (PWFA). Below we’ll refer to employees and applicants collectively as “employees.”
Pregnancy Related Accommodations
Under the PWFA, employees are entitled to accommodations for a condition related to or affected by pregnancy, childbirth, or a related medical condition. The condition can be physical or mental. Pregnancy-related conditions include, among others, morning sickness, gestational diabetes, post-partum depression, and lactation.
This law expands employer obligations beyond what is already required by the Americans with Disabilities Act (ADA) in that being entitled to a pregnancy-related accommodation does not require that the employee’s condition rise to the level of disability. Also, employees are entitled to accommodations even if they can’t perform their essential job functions on a temporary basis.
Possible accommodations include but aren’t limited to:
- Providing more frequent or longer breaks
- Modifying a food or drink policy
- Providing seating or allowing the employee to sit more frequently if their job requires standing
- Observing limits on lifting
- Providing job restructuring, light duty, or a modified work schedule
Employers can’t require an employee to take leave if a reasonable on-the-job accommodation is available. Like the ADA, the employer and employee should engage in the interactive process to determine what reasonable accommodations can be provided. However, if the employer is willing to grant the employee’s request, the interactive process is not required.
Note that many states have already implemented pregnancy accommodation laws, some of which may be more generous than the PWFA. Employers need to apply the law—or the aspect of each law—that is most favorable to employees.
Undue Hardship Exception
Employers don’t have to provide an accommodation if doing so would cause an undue hardship on the operation of the employer’s business. Undue hardship is defined as “an action requiring significant difficulty or expense,” the same as under the ADA. This is a high standard for employers to meet.
EEOC Released PWFA Resources
- Tips for workers to request accommodations
- “Know Your Rights” video series
- Revised “Know Your Rights” posterthat must be posted in the workplace
- What You Should Know about the Pregnant Workers Fairness Act
- Infographic for employers
- PWFA informational poster
The PWFA requires covered employers—those with 15 or more employees—to provide reasonable accommodations to a worker’s known limitations related to pregnancy, childbirth, or related medical conditions, unless it will cause the employer an undue hardship.
On May 17, 2023, the U.S. Department of Labor released a field assistance bulletin (No. 2023-02) to help with enforcement of the pump at work provisions of the Providing Urgent Maternal Protections for Nursing Mothers Act (the PUMP Act), which amended the Fair Labor Standards Act.
Under the PUMP Act, most nursing employees have the right to reasonable break time and a place, other than a bathroom, that is shielded from view and free from intrusion to express breast milk while at work. This right is available for up to one year after the child’s birth.
This bulletin supplements previously issued materials, including:
- Fact Sheet #73: FLSA Protections for Employees to Pump Breast Milk at Work;
- Frequently Asked Questions—Pumping Breast Milk at Work; and
- Pump at Work Protections under the Fair Labor Standards Act presentation.
In April 2023, the U.S. Department of Labor released an updated Employee Rights Under the Fair Labor Standards Act poster with information about the federal minimum wage, overtime pay, child labor, tip credit, the PUMP Act, and more. The poster has a new revision date (REV 4/23) and replaces prior versions.
Under the FLSA and PUMP Act, employers must provide reasonable break time for nursing employees to express breast milk for their nursing children:
- For one year after childbirth; and
- Each time they need to express breast milk.
Employers must provide a place to express breast milk that isn’t a bathroom, is shielded from view, and free from coworker or public intrusion.
Employers must also display the FLSA poster where employees can easily see it.
On February 22, 2023, the Supreme Court of the United States (SCOTUS) ruled that an employee who was classified by their employer as bona fide exempt, earning over $200,000 per year, but paid on a daily-rate basis didn’t meet the Fair Labor Standards Act’s (FLSA) highly compensated employee (HCE) exemption and was entitled to overtime.
The court’s decision focused on the fact that the employee was paid on a daily-rate basis, not a salary basis as required for the exemption, so he didn’t meet the HCE exemption requirements. According to the decision, “the critical question here is whether Hewitt (employee) was paid on a salary basis under C.F.R. § 541.602(a). A worker may be paid on a salary basis under either § 602(a) or § 604(b). But Helix (employer) acknowledges that Hewitt’s compensation did not satisfy § 604(b)’s conditions. And the Court concludes that Helix did not pay Hewitt on a salary basis as defined in § 602(a).”
Under the FLSA, and unless exempt from it, covered employees must receive at least the federal minimum hourly wage ($7.25) and overtime pay for hours worked over 40 in a workweek at a rate not less than time and one-half their regular rates of pay. The regulations contain a special rule for “highly compensated” employees who are paid a total annual compensation of $107,432 or more. An HCE is exempt if:
- They earn a total annual compensation of $107,432 or more, which includes at least $684 per week paid on a salary or fee basis;
- Their primary duty includes performing office or non-manual work; and
- They customarily and regularly perform at least one of the exempt duties or responsibilities of an exempt executive, administrative, or professional employee.
Per the court’s opinion, “ . . . a high-earning employee [who] is compensated on a “salary basis” when his paycheck is based solely on a daily rate—so that he receives a certain amount if he works one day in a week, twice as much for two days, three times as much for three, and so on, . . . is not paid on a salary basis, and thus is entitled to overtime pay.” Helix Energy Solutions Group, Inc. v. Hewitt; Wage and Hour Division: Overtime Pay
On February 9, 2023, the U.S. Department of Labor (DOL) issued Field Assistance Bulletin (FAB) No. 2023-1, addressing the following topics for employers and their teleworking employees:
- The Fair Labor Standards Act (FLSA), ensuring teleworking employees are paid correctly, and how to apply FLSA-mandated break time for nursing employees to express milk while teleworking.
- The Family and Medical Leave Act (FMLA) and determining eligibility when employees telework or work away from an employer’s workplace.
Employees who work from home, telework, or work away from their employer-controlled workplace continue to be covered by FLSA and FMLA protections. Under the FLSA, employees (including those who telework) must be paid for all hours worked and short rest breaks. For breaks to express breast milk, the FLSA doesn’t require employers to compensate nursing employees for breaks taken to express milk; but when an employer provides compensated breaks, an employee (to include those who telework) who uses that break time to express milk must be compensated for the break. In addition, consistent with the FLSA’s general requirement, if an employee is not completely relieved from duty during these breaks, the time must be compensated as work time. If a remote employee chooses to attend a video meeting or conference call, even if off camera, generally the employee in that case is not relieved from duty and, therefore, must be paid for that time. Protections under the FLSA apply equally to employees who telework as they do to employees working at an office, factory, construction site, retail outlet, or any other worksite location.
Under the FMLA, all the hours an employee works are counted to determine their FMLA eligibility. This includes when they telework from home, consistently or in combination with working at other worksites. The FMLA also requires that they work at a location where the employer has at least 50 employees within 75 miles where the employee works; however, under the FMLA, the employee’s personal residence is not a worksite. So for a teleworker, this worksite threshold is fact-specific to them and based on certain elements of their job. For instance, where does the teleworker report for work? Where is the office where they get their assignments? Either of these locations could be established as their workplace and then the threshold is applied (are there at least 50 employees within 75 miles of that location?).
The FAB also provides various examples.
On January 24, 2023, the Equal Employment Opportunity Commission (EEOC) released updated guidance explaining how the Americans with Disabilities Act (ADA) applies to job applicants and employees with hearing disabilities. The guidance explains:
- When an employer may ask an applicant or employee questions about a hearing condition and how it should treat voluntary disclosures;
- What types of reasonable accommodations applicants or employees with hearing disabilities may need;
- How an employer should handle safety concerns about applicants and employees with hearing disabilities; and
- How an employer can ensure that no employee is harassed because of a hearing disability or any other disability.
The EEOC enforces the employment provisions of the ADA, which prohibits discrimination against qualified individuals with disabilities. Title I of the ADA covers employment by private employers with 15 or more employees. Most states also have laws prohibiting employment discrimination on the basis of disability. State law may apply to smaller employers—for instance, those with less than 15 employees—and may provide protections in addition to those granted under the ADA. To ensure compliance, employers should be mindful of the federal, state, and local laws that apply to them and protect against discrimination.
On January 20, 2023, the U.S. Citizenship and Immigration Services (USCIS) announced new designs for Green Cards (officially known as Permanent Resident Cards) and Employment Authorization Documents (EADs). USCIS will begin issuing these redesigned cards on January 30, 2023, with the goal of improving the security of and minimizing the fraud associated with these cards.
The new designs included:
- Updated technology with improved detailed artwork;
- Tactile printing integrated with the artwork;
- Enhanced optically variable ink;
- Secure holographic images (on the front and back of the card);
- A layer-reveal feature with a partial window on the back photo box; and
- Relocated data fields, as opposed to previous card designs.
However, and important for employers to be aware of, these new designs do not invalidate an individual’s currently issued card. Cards are valid until they expire or its otherwise noted (cards may be automatically extended as indicated on Form I-797, Notice of Action, or in a Federal Register notice). Additionally, Green Cards issued between 1979 and August 1989 do not have expiration dates and remain valid. Lastly, some Green Cards and EADs issued after January 30, 2023, may still have the preexisting designs and format. This is because USCIS has continued to use existing cardstock until its current supplies are gone (both versions of the cards are acceptable for Form I-9, Employment Eligibility Verification; E-Verify; and Systematic Alien Verification for Entitlements (SAVE)). Here is more about Green Cards and EADs.