State & Local Employment Law Developments: Q1 2026 (and Beyond)

At a Glance

• We summarize significant new employer obligations in 18 states plus the District of Columbia during the first quarter of 2026 as well as a few changes taking effect after the first quarter.
• These state and local employment law developments include expanded paid-leave programs; pay notice and recordkeeping requirements; evolving restrictions on noncompetes and other restraints of trade; increased regulation of artificial intelligence in employment decisions; and expanded discrimination, harassment, and workplace safety protections.

This quarter, we continue to highlight the ever-changing state and local employment law landscape. New state laws taking effect during the first quarter of 2026 continue to focus on increasing employee protections. Although it is not feasible to discuss all new laws, this update provides an overview of significant recent legislative and regulatory developments to help employers stay in compliance with local and state employment laws. Any changes in Q1 2026 after January 15, 2026, will be shared in subsequent reports.

California

New laws affecting restraint of trade, artificial intelligence, workplace rights, employer pay data, payment of wages, and more that took effect on or after January 1, 2026, are summarized in our previous alert, here.

Colorado

Beginning January 1, 2026, Colorado’s Family and Medical Leave Insurance (FAMLI) Act extends the duration of leave by up to an additional 12 weeks for a parent of a child receiving inpatient care in a neonatal intensive care unit.

On February 1, 2026, amendments to the COMPS Order, Wage Protection Rules, and the Colorado WARNING Rules become effective. These revisions bring these wage regulations into alignment with amendments made to the Wage Act last year. A discussion of these changes can be found in our prior alert, here.

In addition, the COMPS Order is also revised to address changes to the employment of minors as well as record-keeping and earning-statement requirements. The Wage Protection Rules reflect changes to the definition of successor employer and clarification about payment of sick leave under the Colorado Healthy Families and Workplaces Act, clarification related to the definition of “willful” under the Wage Protection Rules, and the definition of “clear error” during an appeal to a hearing officer related to the Division of Labor Standards and Statistics in the Department of Labor and Employment’s determination. The Colorado WARNING rules will also be updated to address clarification related to the definition of “willful” under the WARNING rules, the expanded definition of interference, and clarification related to the definition of “employer” under C.R.S. § 8-4-120 of the Wage Act and “prospective employee” under C.R.S. § 8-5-102(2) of the Colorado Equal Pay for Equal Work Act.

Effective February 1, 2026, various amendments to the Agricultural Labor Conditions Rules take effect. The amendments provide additional clarification related to the definitions of a “workday” and “workweek” under the rules, additional requirements related to protections against heat illness and injury, agricultural employees’ ability to access key service providers and communications with those providers during rest and meal breaks, visitors at employer-provided housing, agricultural employees’ ability to leave an employer’s residence, and emergency access to employers’ property.

Colorado also adopted the Colorado Youth Employment Standards Rules, which become effective February 1, 2026. These rules are adopted to provide additional rules and regulations related to youth employment in Colorado. The rules address various issues including procedural rules related to claims under the Colorado Youth Employment Opportunities Act, recordkeeping requirements, and guidance related to hazardous occupations for minor employees.

Connecticut

Connecticut has enacted phased expansions to its paid sick leave law. Effective January 1, 2026, employers with at least 11 employees in the state must provide paid sick leave; and beginning January 1, 2027, the requirement will apply to all employers with at least one employee in Connecticut.

Delaware

Effective January 1, 2026, Paid Family and Medical Leave benefits are available. Most employers with 10 or more employees must provide paid family and medical leave (PFML) benefits. PFML benefits are available for eligible employees taking: (i) parental leave to care for a child during the first year after the child’s birth, adoption, or placement for foster care; (ii) family caregiving leave to care for a family member with a serious health condition or for a qualifying exigency; or (iii) medical leave for the employee’s own serious health condition that renders them unable to perform job functions. However, employers with 10 to 24 employees are only required to provide parental leave benefits. Employees may take up to a total of 12 weeks of PFML benefits in an application year. Although an employee may take up to 12 weeks of parental leave in an application year, they may only take up to six weeks’ total of medical leave and family caregiving leave in any 24-month period.

District of Columbia

Effective January 1, 2026, tipped wage workers’ pay statements must include a list of sources of the employees’ compensation in addition to base wages and gratuities, including bonuses, commissions on sales, any amount calculated as a percentage of service charges, or other sources.

Illinois

Illinois lawmakers enacted an array of new employment-related laws and amendments that recently took effect or will take effect in 2026, covered more thoroughly here.

Effective January 1, 2026, the Illinois Human Rights Act (IHRA) makes it a civil rights violation for an employer to use artificial intelligence (AI) that has the effect of subjecting employees to discrimination based on a protected class under the IHRA or that uses zip codes as a proxy for a protected class with respect to “recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure, or the terms, privileges or conditions of employment.” Employers must also provide notice to employees and prospective employees if AI is used to influence or facilitate an employment decision. In the coming months, the Illinois Department of Human Rights is expected to issue rules related to this amendment, including details about the notice requirement imposed on employers.

On December 11, 2025, President Trump signed an executive order that seeks to ban states, like Illinois, from passing or enforcing laws that regulate AI or require disclosures that violate the First Amendment or other constitutional provisions. More information on this executive order can be found here.

Effective December 12, 2025, the Illinois Right to Privacy in the Workplace Act, pursuant to an amendment, provides that if an employer receives written notice from a federal agency or other outside vendor not responsible for the enforcement of immigration law (e.g., the Social Security Administration, Internal Revenue Service, an insurance company) of a discrepancy in an employee’s individual tax identification number or other identifying documents, the employer must provide notice to the employee (and to the employee’s authorized representative, if any), as soon as practicable, but not more than five business days after the date the notice was received or after the employer determines that an employee must respond to the notice, whichever is longer, unless federal law or a collective bargaining agreement provides for a shorter timeline. This notice, which must contain certain items, must be provided in person and delivered by hand, unless hand delivery is not possible, in which case the notice must be mailed and emailed (if an email address is known). The amendment provides certain additional rights to impacted employees.

Louisiana

Effective January 1, 2026, employers are not required to withhold income taxes from wages that are paid to nonresident employees working in Louisiana for 30 or fewer days. This threshold is increased from 25 days. In addition, all withholding tax returns and 1009-NECs issued to Louisiana residents for the taxable period on or after January 1, 2026, must be submitted and related payments made electronically.

Maine

Maine’s paid family and medical leave (PFML) program will allow eligible employees to receive up to 12 weeks of paid leave beginning May 1, 2026, with employer participation and required contributions already in effect.

Minnesota

Effective January 1, 2026, Minnesota’s wage and hour law is amended to require employers to provide: (i) a paid rest break of at least 15 minutes or enough time to utilize the nearest convenient restroom, whichever is longer, within each four consecutive hours of work; and (ii) an unpaid meal break that is at least 30 minutes when working six or more consecutive hours. Employers that fail to provide the required meal and/or rest breaks are liable to the employee for the meal and/or rest break time that should have been allowed at the employee’s regular rate of pay, plus an additional equal amount as liquidated damages. The changes to Minnesota’s laws do not prohibit employers and employees from establishing different rest and meal breaks if pursuant to a collective bargaining agreement.

Effective January 1, 2026, Minnesota’s Earned Sick and Safe Time (ESST) law is amended, and an employer is permitted to advance ESST to an employee based on the number of hours the employee is anticipated to work for the remaining portion of an accrual year. If the advanced amount is less than the amount the employee would have accrued based on the actual hours worked, the employer must provide additional ESST to make up the difference.

Effective January 1, 2026, employees may begin to apply for Minnesota Paid Leave (MPL) benefits, and employer/employee contributions begin (if using the standard State Leave Program). An employee’s pay statements must reflect the total MPL contribution paid by the employer and the total MPL contributions deducted from the employee’s wages. By April 30, 2026, employers must begin making deposits of the premium contributions, based on an employee’s wages earned between January 1, 2026, and March 31, 2026, with the Department of Employment and Economic Development.

Montana

Effective January 1, 2026, Montana employers are prohibiting from entering into noncompete agreements with any licensed physician. Previously, the ban only applied to certain health care professionals. The ban does not apply to certain repayment requirements, including requirements to repay loans, relocation costs, signing bonuses, education expenses, or tuition repayment expenses, as long as those repayment requirements are pro-rated.

New Hampshire

Effective January 1, 2026, the following legal changes took place in New Hampshire:

• Employers with at least 20 employees must provide eligible employees with up to 25 hours of unpaid, job-protected leave during the first year following the birth or adoption of a child to attend the employee’s own medical appointments for childbirth or postpartum care and the employee’s child’s pediatric medical appointments. Employees must provide notice and make reasonable efforts to schedule leave to minimize disruption and may substitute accrued paid leave if preferred.
• Employers with 50 or more employees at the same location in New Hampshire may not terminate, refuse to hire, or take adverse employment actions against an employee because their spouse is involuntarily mobilized for military service in support of war, national emergency, or contingency operations. Any leave taken because of such mobilization is unpaid, and employers are not required to continue benefits or accruals unless they choose to do so. Employees are generally entitled to reinstatement to their previous or a comparable position for the same duration of reemployment rights under federal law once their spouse’s mobilization ends.

New York

Effective January 1, 2026, the minimum salaries for executive and administrative employees exempt from New York’s minimum wage and overtime requirements increased. For employers in New York City, Nassau County, Suffolk County, and Westchester County, the minimum salary increased from $1,237.50 per week to $1,275.00 per week. For employers in the remainder of New York State, the minimum salary increased from $1,161.65 per week to $1,199.10 per week.

Amendments to New York City’s Earned Safe and Sick Time Act (ESSTA), effective February 22, 2026, expand covered uses of leave, codify paid prenatal leave, require a new unpaid sick and safe leave bank, and consolidate most Temporary Schedule Change Act (TSCA) reasons into ESSTA while replacing the TSCA’s mandatory approval requirement with a response obligation.

Amendments to the New York Fair Credit Reporting Act, effective April 18, 2026, generally prohibit employers from requesting or using an applicant’s or employee’s consumer credit history in employment decisions, subject to limited statutory exceptions. The law makes it an unlawful discriminatory practice to rely on credit history — defined broadly to include credit reports, credit scores, or other information reflecting an individual’s creditworthiness — unless one of eight enumerated exceptions applies. The amendments also expressly permit local governments to enact more protective measures; as a result, New York City’s existing restrictions on the use of credit history in employment remain unchanged.

North Carolina

Effective, January 1, 2026, for the purpose of any state administrative rules, regulations, or public policies, “sex” means a person’s biological sex, either male or female, at birth. An individual’s self-declared gender identity will not be treated as legally or biologically equivalent to sex.

Oklahoma

Effective January 1, 2026, amendments to Oklahoma’s data-breach notification law under Senate Bill 626 became effective and could impact employers who own or maintain sensitive information on employees, such as social security numbers and biometric data. The most significant changes include that, under the amendments, the definition of “personal information” was expanded to include a unique identification number created by a government entity, “unique electronic identifier or routing code in combination with any required security code, access code, or password that would permit access to an individual’s financial account”; and a “unique biometric data such as a fingerprint, retina scan or iris imagine, or other unique physical or digital representation of biometric data to authenticate a specific individual.” In addition, the amendments expanded covered entities’ notification requirements to include the attorney general and covered residents under certain situations. Also, the amendments updated penalties under the law, when a covered entity fails to use reasonable safeguards but provides necessary notice, to $75,000 plus actual damages. Entities that use reasonable safeguards and provide needed notice are not subject to civil penalties and may use these processes as an affirmative defense.

Oregon

Effective January 1, 2026, amendments to Oregon’s Paid Sick Leave law under Senate Bill 1108 took effect. Now, employees may take paid sick leave for blood donation made in connection with a voluntary program approved by either the (a) American Association of Blood Banks or (b) American Red Cross.

Amendments to Oregon’s pay statement and notice requirements related to wages under Senate Bill 906 took effect January 1, 2026. Under the law, at the time of hire and annually on January 1 thereafter, employers are required to provide employees with written notice of the following: (1) the regular pay period; (2) a comprehensive list of the eligible pay rates and all deductions and contributions; (3) the purpose of the deduction; (4) allowances claimed as part of the minimum wage; (5) employer-provided benefits that may appear as contributions and deductions; and (6) all payroll codes used, with a description of each. An employer can satisfy these notice requirements by making the information available to employees in a location easily accessible to them, such as a link to a website, a physical document posted in a central location, a shared electronic file, or by email. There is a $500 penalty for violations of this notice requirement.

On January 1, 2026, amendments to Oregon’s law related to health care employee protections under Senate Bill 537 became effective. The amendments make several changes to Oregon’s law related to protecting health care workers from workplace violence. Some of the major changes include that covered employers are required to conduct workplace safety assessments, revise their workplace violence prevention programs to, among other things, provide procedures for conducting investigations and implementing post-incident response, ensure a person with the appropriate knowledge and expertise is available to employees to answer questions related to workplace violence protection, and provide workplace violence prevention and protection training to employees and contracted security personnel on an annual basis.

Senate Bill 1148 became effective on January 1, 2026, and requires that entities that provide disability income insurance policies (e.g., employers who provide disability income insurance policies) cannot require a person eligible for benefits under the insurance policy to utilize or apply for benefits under Oregon Family and Medical Leave Insurance prior to being able to access entity-provided benefits.

Pennsylvania

Effective January 1, 2026, Pittsburgh, Pennsylvania’s Paid Sick Days Act is amended to increase both the accrual rate and the amount of leave employees may use per year. Employees may now accrue one hour of paid sick leave for every 30 hours worked and will be permitted to accrue up to 72 hours of paid sick time in a calendar year (48 hours if the employer has fewer than 15 employees). Employees only accrue paid sick leave for the hours worked in Pittsburgh.

Effective January 26, 2026, the Pennsylvania Human Relations Act is amended to prohibit discrimination based on traits and hairstyles associated with an individual’s race or religion. If an employer’s rule or policy impacts a trait or head covering associated with race or religion, employers must demonstrate that the rule/policy is needed for health or safety purposes, adopted for nondiscriminatory reasons, specifically tailored to the applicable position and activity, and applied equally to all employees.

Rhode Island

Effective January 1, 2026, Rhode Island’s Temporary Caregiver Insurance (TCI) benefit maximum increases from seven weeks to eight weeks per benefit year. The law also expands the permitted purposes of TCI to include paid leave for bone marrow and organ donation procedures and recovery. It also broadens the list of family members for caregiving benefits to include siblings.

Texas

Effective January 1, 2026, the Texas Responsible Artificial Intelligence Governance Act, Texas’ law related to AI, took effect. Under the Act, an “Artificial Intelligence System” means “any machine-based system that, for any explicit or implicit objective, infers from the inputs the system receives how to generate outputs, including content, decisions, predictions, or recommendations, that can influence physical or virtual environments.” In addition, the Act protects “consumers” who are Texas residents (i.e., Texas employees). Overall, the new law creates a regulatory framework for the development and use of AI systems. Accordingly, Texas employers using AI will be required to meet the notice requirements and comply with other restrictions under the law including not using an AI system to intentionally discriminate against individuals based on a protected characteristic.

Again, employers should consider President Trump’s December 11, 2025, executive order that seeks to ban states from passing or enforcing laws that regulate AI or require disclosures that violate the First Amendment or other constitutional provisions. More information on this executive order can be found here.

Washington State

Effective January 1, 2026, there will be certain changes to the state’s Paid Family and Medical Leave (PFML), namely:

• Expanding job-protected leave to employees of employers with 25 or more employees (down from 50), and who worked for the company for 180 calendar days prior to the start of leave (down from 1,250 hours in the last 12 months).
• PFML job-protected leave and FMLA leave may be required to run concurrently, provided the employer provides written notice as specified in the statute.
• Employees are required to affirmatively exercise their right to job reinstatement.
• Employers must provide certain notice regarding reinstatement.
• The minimum claim duration per week is lowered from eight consecutive hours to four hours.
• Employers are generally required to continue employee benefits (removing the caveat that such benefit continuation is required only if there is at least one day of PFML running concurrently with FMLA).
• The state will develop a written statement of employee rights that must be distributed to employees by employers within five business days after receiving notice that the employee’s absence is due to PFML or within five business days after an employee’s seventh consecutive day of absence due to a reason covered by PFML.
• There are changes to grants available to small employers to offset the impact of employees taking PFML leave.

Additional changes effective January 1, 2026:

• Washington’s Domestic Violence Leave Act is expanded to include employees who are victims, or whose family members are victims, of a hate crime, as defined by the law. Employees will be able to take leave under that Act, and be able to use sick leave for certain absences related to a hate crime.
• The minimum salary required for most overtime-exempt employees in Washington increases from $1,499.40 per week for large employers (with 51 or more employees) and from $1,332.80 per week for small employers (with 50 of fewer employees) to $1,541.70 for all employers (regardless of size). The minimum wage required for computer professionals paid on an hourly basis will increase to $59.96 (3.5 × the inflation-adjusted minimum wage for 2026).
• Hospital workers may agree to waive meal and rest breaks under certain conditions. In addition, hospital workers may agree to combine multiple meal and rest breaks. Previously, only one meal break could be combined with one rest break.
• The amount of minimum earnings required for a noncompete agreement to be enforceable in Washington is increased for inflation as follows:
  • For employees — $126,858.83 (up from $123,394.17)
  • For independent contractors — $317,147.09 (up from $308,485.43)
  • The Washington Department of Labor and Industry determines the adjustment based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), calculated to the nearest cent.
• Employers must notify employees of unclaimed wages of $50 or more (lowered from $75 or more) no less than 60 days before filing the report to Washington’s Department of Revenue due October 31 of each year.
• The state’s isolated-worker sexual harassment and sexual assault prevention law is amended to:
  1. Require employers of certain isolated workers to provide training and keep records on the use of panic buttons
  2. Modify the definition of isolated worker
  3. Impose new specifications for the design and capabilities of panic buttons
  4. Implement new enforcement procedures and civil penalties