January 31, 2025 Federal Labor & Employment Trends Likely Coming in 2025

Manufacturers may be impacted by a number of significant changes to the federal labor and employment law landscape in 2025 and beyond.

by Abby Warren and Christopher Costain

There are significant changes to the federal labor and employment law landscape that manufacturers must be prepared for in 2025 and beyond. Below are developments we suggest manufacturers should keep a close eye on to ensure compliance.

EEO-1 Reporting Requirements

During the second Obama administration, the Equal Employment Opportunity Commission (EEOC) began requiring private employers with 100 or more employees and certain federal contractors to provide workers’ pay data as part of their EEO-1 “Component 2” reporting requirements. While such entities were previously required to report employee demographic information as part of the EEO-1 “Component 1,” the reporting requirements were expanded to include pay data in an effort to identify wage gaps and investigate discriminatory compensation practices. The EEOC eventually released the reported pay data to the public. However, during President Trump’s first administration this requirement was eliminated, and although the Biden administration prioritized reviving the collection of pay data, the reporting requirements were not restored. While the incoming administration is unlikely to pursue this initiative, manufacturers should remain up-to-date to ensure compliance with state and local pay data reporting requirements and pay equity laws.

Federal Minimum Wage for Non-Exempt Employees and Paid Leave

The incoming Trump administration may not prioritize increasing the federal minimum wage (currently $7.25 per hour), which was last increased in 2009, to the same extent that we saw under the Biden administration. Instead, based on President Trump’s communications regarding the current federal minimum wage, it is likely that any increase to the federal minimum wage may be only marginal and not as significant as the $15 per hour minimum wage proposed by the Biden administration. Nonetheless, manufacturers should be aware of state and local minimum wage requirements, which are often higher than the federal minimum wage. Additionally, while many other countries have adopted paid leave laws at the national level, the paid leave laws in the United States are generally state and locality-specific and provide a range of income replacement benefits for qualified workers. Although President Trump enacted a law providing paid parental leave to federal employees in his first term as president, it is unlikely that his second administration will prioritize a federal paid leave program applicable more broadly to private employers, including manufacturers. Therefore, manufacturers should stay up-to-date on state and local paid leave laws, which continue to expand, and update their handbooks to ensure compliance.

The National Labor Relations Board (NLRB) and Workers’ Right to Organize

It is likely that the second Trump administration may prioritize the manufacturer-friendly policies, rules, and initiatives that were common during President Trump’s first administration and abandon the Biden administration’s efforts to advance workers’ rights to organize, including the Protecting the Right to Organize (PRO) Act, which aims to strengthen workers’ rights to join a union and collectively bargain for improved working conditions. President Trump may also replace the current NLRB General Counsel, Jennifer Abruzzo, soon after his inauguration with a business-friendly nominee who may rescind certain memoranda issued by General Counsel Abruzzo under the Biden administration. This could include memoranda related to employee surveillance, remedies for workers subjected to unfair labor practices, and the scope of permissible confidentiality and non-disparagement provisions. President Trump’s nominee for NLRB General Counsel is critical, as the General Counsel is independent of the Board and plays a vital role in shaping the NLRB’s policy and enforcement priorities and initiatives. President Trump’s NLRB is also likely to return to using more balanced standards and rules when assessing employers’ policies and confidentiality and non-disparagement provisions under the National Labor Relations Act. Whether unionized or union-free, manufacturers may be impacted by these changes at the NLRB and beyond and should take note of these important developments.

Diversity, Equity, Inclusion, and Belonging (DEIB) Policies and Equal Employment Opportunity

It is possible that the Biden administration’s diversity, equity, inclusion, and belonging-focused initiatives (DEIB) may be largely abandoned by the incoming administration and that the Equal Employment Opportunity Commission (EEOC) may redirect its enforcement efforts towards employers that have committed to ambitious DEIB goals. This shift in legislative and enforcement priority at the federal level closely follows on the heels of several major national corporations having recently rolled back various DEIB commitments. Additionally, the Office of Federal Contract Compliance Programs may shift its focus away from strict enforcement of affirmative action-related regulations and instead prioritize increased scrutiny of certain manufacturer DEIB initiatives, focusing on equality compared to equity. President Trump may also issue executive orders directing certain manufacturers contracting with the federal government to take action related to their DEIB programs, similar to his first presidency. Additionally, protections for LGBTQ+ workers may be significantly scaled back under the incoming administration. While legislative and enforcement priorities at the federal level are likely to shift under the incoming administration, manufacturers should also stay up-to-date on critical legislative developments at the state and local levels where their employees work, which may provide workers greater protection than under federal law.

Independent Contractor v. Worker Classification Enforcement

In early January 2021, President Trump’s Department of Labor issued a new, employer-friendly regulation that would have made it easier for employers to classify workers as independent contractors, thereby making wage and hour compliance easier for employers under the Fair Labor Standards Act. However, the Biden administration withdrew the regulation and replaced it with a worker-friendly rule that instead made it difficult for manufacturers to classify workers as independent contractors. With President Trump’s return to the Oval Office on January 20, it is possible that the manufacturer-friendly regulations and policies seen during his first administration may return, giving manufacturers greater flexibility in determining how to classify workers and simplifying federal wage and hour compliance. In addition to the shifting federal policy, manufacturers should also keep up-to-date on more stringent state and local laws regarding working classification.

Conclusion

With the second Trump Administration comes the possibility of significant changes to the federal labor and employment law landscape.  Manufacturers should be aware of these potential developments, as they may impact manufacturers and their workforces as early as the first quarter of 2025 and beyond.

About the Authors:
Abby M. Warren focuses her practice on counseling private sector employers, including multinational corporations, restaurants and hospitality employers, and manufacturers, in all areas of employment law and defending employers in court and before administrative agencies.  She is a member of Robinson+Cole‘s Labor and Employment Group.

Christopher A. Costain counsels clients across numerous industries including hospitality and manufacturing in employment law and human resource workplace matters and defends employers in court and before administrative agencies. He is a member of Robinson+Cole‘s Labor and Employment Group.

Read more from the authors:

Worker Classification Continues as ‘Hot Topic’ for 2024 | PE magazine, Winter 2024

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