Employment Law & Compliance Highlights from the Law Offices of Paul P. Cheng

Employment Law & Compliance Highlights from the Law Offices of Paul P. Cheng

– FEDERAL –

1. DOJ Expands Whistleblower Awards Program to Include Immigration Violations by Employers

As of May 12, 2025, the U.S. Department of Justice (DOJ) has broadened its Corporate Whistleblower Awards Pilot Program to include violations of federal immigration law by employers. This expansion aligns with the current administration’s enforcement priorities. Both current and former employees may now submit tips directly to the DOJ regarding an employer’s non-compliance with federal immigration requirements.

Client Advisory: We encourage businesses to review their immigration compliance practices. Please consult with our office or your designated legal counsel to assess any potential impact this may have on your operations.

2. DHS Updates E-Verify Protocol for Revoked Employment Authorization Documents (EADs)

The Department of Homeland Security (DHS) has issued updated guidance affecting E-Verify employers. Effective immediately, DHS will no longer issue Case Alerts when an employee’s EAD is revoked. Instead, employers must regularly run the Status Change Report in E-Verify to identify revoked work authorization. Note: Case Alerts for routinely expiring documents will still be issued.

Recommendation: Employers should update internal protocols and ensure HR teams are running status reports proactively to maintain compliance.

3. DOL Will No Longer Seek Liquidated Damages in Certain FLSA Settlements

On June 27, 2025, the U.S. Department of Labor’s Wage and Hour Division issued Field Assistance Bulletin No. 2025-3, announcing a significant change in enforcement policy. The agency will no longer pursue liquidated damages during administrative settlements under the Fair Labor Standards Act (FLSA). Moving forward, the DOL will focus solely on recovering unpaid minimum wages and overtime pay—previously, it sought an additional equal amount as liquidated damages.

Takeaway: This change could reduce potential settlement costs for employers involved in administrative resolution of wage claims.

– CALIFORNIA –

1. Los Angeles Hotel Worker Minimum Wage Ordinance Temporarily Suspended

The implementation of Los Angeles City Ordinance No. 188610—an amendment to the Citywide Hotel Worker Minimum Wage Ordinance—has been temporarily halted. This ordinance, which includes new requirements related to employee training and healthcare benefits, is currently suspended due to the filing of a referendum petition.

What This Means:

• The $22.50 hourly minimum wage for hotel workers at properties with 60+ rooms, originally set to take effect July 1, 2025, will now be delayed.
• The ordinance will remain on hold until the City Clerk determines whether the referendum petition is valid and sufficient.

• If insufficient, the ordinance (including the wage increase) will become effective the following day.
• If sufficient, the ordinance will remain suspended until further action is taken.

Employers Impacted: Hotel operators in Los Angeles should prepare for both outcomes and monitor the City Clerk’s determination closely.

2. California Finalizes Employment Regulations on Use of AI and Automated Decision Systems

The California Civil Rights Council has finalized regulations addressing the use of artificial intelligence and other automated decision-making technologies in employment. These Employment Regulations Regarding Automated-Decision Systems were approved by the Office of Administrative Law on June 27, 2025, and will take effect on October 1, 2025.

Key Takeaways:

• Employers may be found in violation of California’s anti-discrimination laws if automated systems adversely impact individuals based on protected characteristics such as race, gender, or disability.
• All employers and covered entities must now retain employment and automated decision-related records for at least four years.
• The regulations are intended to clarify how existing laws apply to emerging hiring and employment technologies, including AI tools and algorithms.

Next Steps: Employers using AI-driven systems for hiring, evaluations, or terminations should conduct an internal audit to ensure compliance ahead of the October effective date.

These developments highlight the evolving landscape of employment regulations on both federal and state levels. Employers should stay updated and ensure compliance to avoid legal pitfalls and potential penalties. Legal counsel is recommended to navigate any complex changes effectively.

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Law Offices of Paul P. Cheng & Associates