Year-End Review HCM Compliance Laws Beginning in 2023

We are nearing the end of 2022 and there are numerous new laws or requirements that become effective in 2023. Below are summaries of what to expect and prepare for beginning January 1, 2023, through June 30, 2023.

California Bereavement Leave

• Effective January 1, 2023.
• AB 1949 requires employers with 5 or more employees in California to provide eligible employees with up to 5 days of unpaid bereavement leave for the death of a parent, spouse, child, sibling, grandparent, grandchild, domestic partner, or parent-in-law.
• The time off must be completed within three months of the date of death and does not need to be taken in consecutive days.

Paid Leave and California Family Rights Act Amendments

• Effective January 1, 2023.
• AB 1041 allows California employees to use Paid Sick Leave or take leave under the California Family Rights Act (CFRA) to care for a “designated person.”
• A designated person is defined as any individual related by blood or whose association with the employee is equivalent to a family relationship. An employee can designate this person at the time they request leave.
• Employers can limit an employee to one person in a 12-month period as the employee’s designated person.

California Privacy Rights Act

• Effective January 1, 2023.
• Enforceable on July 1, 2023.
• The business-to-business and employer exemptions for CPRA requirements ends on 1/1/2023.
• Employees will be able to request access to their personal information and information about how automated decision technologies work; have the right to correct inaccurate personnel information; have the right to request that an employer delete their personal information; and have the right to limit the use and disclosure of sensitive personal information to that which is necessary to perform the services or provide the goods reasonably expected by an average consumer who requests such goods and services.
• Employers will have specific notice requirements to follow.
• For more information on CPRA Amendments, visit The California Privacy Rights Act of 2020.
• For more information on The California Privacy Protection Agency, visit CPPA.ca.gov.

California Pay Data Reports and Pay Scale Requirements

• Effective January 1, 2023.
• Senate Bill 1162 includes provisions that alter the current regulations for the annual California Pay Data Reporting, and a new regulation requiring certain employers to provide pay scale information on job applications.

Los Angeles, California Fair Workweek Ordinance

• Effective April 1, 2023.
• Enforcement will take effect 180 days from effective date.
• Requires retail employers with more than 300 employees globally to provide good faith scheduling estimates and Notice; 10 Day notice of good faith estimate; the right to request changes to their schedules; 14-day advance notice to schedules; and the right to decline a schedule change.
• Predictability Pay for changes in time, date, or location that do not result in loss of employee time or adds more than 15 minutes to an employee schedule.
• For more information access the ordinance adding Article 5 to Chapter XVIII of the Los Angeles Municipal Code and amending Article 8 of Chapter XVIII of the Code.

Colorado Paid Family and Medical Leave

• Contributions begin January 1, 2023.
• Provides up to 12 weeks of paid family and medical leave, with an additional 4 weeks for pregnancy or childbirth complications.
• Benefits become available January 1, 2024.
• For more information, visit The Colorado Family and Medical Leave Insurance Program (FAMLI).

Colorado Wage Theft Act

• Certain provisions effective January 1, 2023
• Senate Bill 22-161 updates and modifies laws pertaining to payment of wages and employee misclassification. Penalties for violations are increased.

Illinois Support Through Loss Act

• Effective January 1, 2023.
• Requires an employer to grant each employee 24 hours of paid leave time to take for an eligible reason related to a loss.
• Any employer with a paid leave policy that meets or exceeds the requirements of the Act shall not be required to grant an employee additional paid leave time.
• Paid leave does not carry over from year to year.
• Access Senate Bill SB 3120 for more information.

Illinois Meal and Rest Break Amendments

• Effective January 1, 2023.
• Every employer shall provide every eligible employee with at least 24 hours of consecutive hours of rest every seven consecutive days worked in addition to regular rest after the close of each working day.
• An employee that works at least 7.5 total hours shall be entitled to at least one 20-minute meal break no later than 5 hours into the employee's shift.
• An employee that works more than 7.5 continuous hours shall be entitled to an additional 20-minute meal period for every additional 4.5 continuous worked hours.
• Provides that any employer that violates any of the provisions of the One Day Rest In Seven Act is guilty of a civil offense and subject to a civil penalty of up to $500 per offense.
• Access Public Act 102-0828 for more information.

Maine Vacation Pay-Out

• Effective January 1, 2023.
• An employee leaving employment must be paid in full no later than the employee's next established payday.
• All unused paid vacation accrued pursuant to the employer's vacation policy must be paid to the employee on termination of employment unless the employee is employed by an employer with 10 or fewer employees or by a public employer.
• For more information, visit the Act Regarding the Treatment of Vacation Time upon the Cessation of Employment.

Massachusetts Premium and Holiday Pay

• Effective January 1, 2023.
• Sunday Premium pay and Holiday pay are no longer required.
• For more information, visit Massachusetts Blue Laws.

Michigan Paid Medical Leave Amendments

• Effective February 19, 2023.
• All employees would be entitled to receive and use one hour of paid medical leave for every 30 hours worked, up to 72 hours per year.
• Small businesses with fewer than 10 employees would be required to grant 40 hours paid leave, 32 hours unpaid.
• This is pending legal proceedings. We will provide updates as soon as they come in.
• For more information, visit the Michigan Paid Medical Leave Act.

Oregon Agriculture Overtime Changes

• Effective January 1, 2023.
• HB 4002 requires that beginning January 1, 2023, employers must pay overtime to agricultural workers for hours worked beyond 55 hours in a workweek.
• This is the beginning of a 4-year phase in process that will require employers to provide overtime to agricultural workers that work more than 40 hours per work week.
• For more information, visit the Oregon Bureau of Labor & Industries.

Oregon Paid Family and Medical Leave

• Contributions begin on January 1, 2023.
• Maximum of 12 weeks of paid leave, with total paid and unpaid leave capped at 16 weeks (or up to 18 weeks for women who experience complications due to pregnancy or childbirth).
• For more information, visit the Oregon Paid Leave Program.

New Jersey and Rhode Island State Healthcare Reporting (ACA) Updates

• Effective January 1, 2023 for tax year 2022.
• Employers must furnish forms 1095-C by March 2 of each year.
• Forms must be filed by March 31 of each year.

New York expands Paid Family Leave Act

• Effective January 1, 2023.
• The Act was amended to include siblings in the definition of family member for the purposes of paid family leave.
• For more information, visit the New York Paid Family Leave Updates for 2023.

Rhode Island Fair Employment Practices Pay Disclosure

• Effective January 1, 2023.
• Employers must provide wage information to certain job applicants and employees seeking a job transfer and prohibiting employers from asking applicants about their salary history and/or relying on that wage history in the hiring decision.
• Access Senate Bill 270 for more information.

Washington Equal Pay and Opportunities Act

• Effective January 1, 2023.
• Employers with 15 or more employees must provide a wage scale or salary range, plus information on benefits and other compensation in their job postings.
• For more information, visit the Washington State Department of Labor & Industries.

2023 Plan Limits for Health FSA and Other Plans

• Affects plan years starting on or after January 1, 2023
• Health FSA, including a Limited Purpose Health FSA = $3,050/year
• Health FSA maximum carryover of unused amounts = $610/year
• Qualified Transportation plans = $300/month
• Qualified Parking plans = $300/month
• Excepted Benefit HRA = $1,950/year
• Qualified Small Employer HRA (QSEHRA) increases to $5,850/year for single coverage and $11,800/year for family coverage
• For more information about the EBHRA limits, access RP-2022-24.
• For more information about all the other plan limits, access RP-2022-38.

2023 HSA Contribution Limits

• Effective January 1, 2023.
• Self-only Coverage = $3,850
• Family Coverage = $7,750
• Catch-up Limit (Age 55 or older) = $1,000
• For more information about HSA Limits, access RP-2022-24.

For information from the 2022 Mid-Year Alert, visit the HCM Mid-Year Review.

If you're a Paylocity client looking for more details on any of these legislative updates, log in to visit and search the PEAK Knowledge Base.

This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.