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The Latest

Employment Law Alert – New Virginia Employment Laws Effective July 1, 2023

July 6, 2023


Employment Law Firm

On July 1, 2023, several new employment-related laws passed by the General Assembly and signed into law by Governor Youngkin earlier this year became effective in Virginia. Below we highlight three of the most noteworthy new laws applicable to employers:

  1. Minimum Wage for Employees with Disabilities

Virginia Code § 40.1-28.9 historically allowed employers with a special certificate issued under 29 U.S.C. § 14(c) of the Fair Labor Standards Act (“FLSA”) to employ individuals with disabilities at a sub-minimum wage. Virginia employers should be aware that, going forward, House Bill 1924 removes this exception to the Virginia Minimum Wage Act.

Effective July 1, 2023, no employer in Virginia may pay sub-minimum wages unless they had a 14(c) exemption prior to that date. Employers that had a 14(c) exemption prior to July 1, 2023, have until July 1, 2030 (when these exemptions expire) to increase the pay rates of disabled workers to at least the prevailing minimum wage in Virginia as of that date. All employers without a 14(c) exemption, should remember that, as of January 1, 2023, the minimum wage in Virginia is $12.00 per hour.

  1. Update for Virginia Government Contractors

House Bill 1684 amends Virginia’s state debarment procedures and civil penalties such that state government contractors may now be barred from public state contracts if it is determined that the contractor has misclassified their workers.

Effective July 1, 2023, when the Department of Taxation (“Department”) determines that an employer has failed to properly classify a worker as an employee, the Department shall notify the employer and this notification shall serve as an action by the Department with respect to debarment. Once all administrative and judicial appeals have been exhausted, or the time period for bringing such appeals has expired, any such employer shall be subject to a civil penalty of up to $1,000 per misclassified individual for a first offense, up to $2,500 per misclassified individual for a second offense and up to $5,000 per misclassified individual for a third or subsequent offense. In addition, state agencies, public bodies and covered institutions shall not award a contract to any such employer: (i) for a period of up to one year for a second offense; or (ii) for a period of up to three years for a third or subsequent offense.

  1. Whistleblower Tort Liability Immunity

House Bill 1757/Senate Bill 845 provides tort liability immunity to employees for any tort claim based on an employee’s legally protected statements against an employer (with certain, limited exceptions).

Effective July 1, 2023, employees shall be immune from tort claim liability (a claim for libel or slander, for example) based solely upon statements that are: (i) regarding matters of public concern protected under the First Amendment and communicated to a third party, (ii) made at a public hearing or (iii) made by an employee against an employer where retaliatory action arising from such statements is prohibited. However, this immunity does not apply to any statements that the declarant knew or should have known were false, or made with reckless disregard for their falsity.

Virginia Employer Reminder: Additional Action Items

Virginia employers are also reminded to make sure their employee handbooks and/or restrictive covenant/confidentiality agreements are updated in light of these additional new laws that went into effect July 1, 2023 (for more information, see our previous Alert here). We encourage all Virginia employers to these new laws, and seek legal counsel, if necessary, to ensure your prompt compliance.

CONTACT

 

Gregory Grant

ggrant@shulmanrogers.com

Anna Margolis

amargolis@shulmanrogers.com

 

MORE INFORMATION

The contents of this Alert are for informational purposes only and do not constitute legal advice. If you have any questions about this Alert, please contact the Shulman Rogers attorney with whom you regularly work or a member of the Shulman Rogers Employment and Labor Law Group.

To receive Employment Law Alerts and other timely news and information from Shulman Rogers, please click HERE to subscribe.

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