As 2025 approaches, Virginia residents and businesses will face significant changes with the implementation of several new laws that impact wages, workplace protections, retirement savings, and reporting obligations. These legal updates are designed to improve workers’ rights, enhance business transparency, and promote economic fairness.
Minimum Wage Increase
On January 1, 2025, Virginia’s minimum wage will rise from $12.00 per hour to $13.50 per hour. This increase is part of a phased plan established by legislation passed in 2020, with the ultimate goal of reaching $15.00 per hour by 2026. This wage hike is viewed as a critical step toward ensuring fair compensation for the Commonwealth’s workers and is expected to provide economic relief to many low-wage employees.
“As we move toward our goal of a $15 minimum wage, this increase is an important milestone in ensuring fair wages for Virginians,” lawmakers stated in support of the initiative.
Expansion of Anti-Discrimination Protections
Virginia’s Human Rights Act will also see important revisions in 2025. The law now explicitly protects employees from discrimination, harassment, and retaliation based on “ethnic origin” – a category that refers to the ancestry of a specific ethnic group. This expansion ensures broader protections for workers, aiming to create a more inclusive and respectful work environment.
Employers will need to update their workplace policies and training programs to align with these changes and to safeguard employees from discrimination on the basis of ethnic origin.
Introduction of RetirePath Virginia
Beginning in 2025, Virginia employers with 25 or more employees who have been operating for at least two years will be required to participate in RetirePath Virginia, a state program that helps workers access retirement savings accounts. Employees will be automatically enrolled in the program, with the option to opt out within 30 days.
This initiative aims to address the growing need for accessible retirement savings options, especially for workers at small and mid-sized businesses that have not historically offered such plans. Employers who fail to comply with the new rule could face penalties of up to $200 per employee.
New Federal Beneficial Ownership Reporting Requirements
In line with the federal Corporate Transparency Act, businesses operating in Virginia will be required to submit Beneficial Ownership Information Reports (BOIR) to the Financial Crimes Enforcement Network (FinCEN) by January 1, 2025. These reports must disclose details of individuals who have substantial control over or own 25% or more of a company.
Failure to comply with these reporting requirements could result in civil penalties. It is essential for Virginia businesses to understand whether they are subject to these new rules and to submit the necessary information to avoid penalties.
DOL Salary Threshold Rule Overturned
In a significant legal shift, a federal court has struck down the Department of Labor’s (DOL) rule that would have increased the salary threshold for exempt employees under the Fair Labor Standards Act. While some changes were set to take effect in July 2024, the U.S. District Court for the Eastern District of Texas invalidated the rule in November 2024, rendering the January 1, 2025, changes void.
As a result, the previously planned salary threshold increase will no longer be enforced, and employers are advised to seek legal guidance on how to proceed under the current regulations.
Navigating the Changes
Virginia’s new laws in 2025 will bring important shifts to the state’s labor, business, and financial sectors. Employers and workers alike should be proactive in understanding and complying with these updates to avoid penalties and ensure smooth transitions. For detailed information, businesses and individuals can visit state and federal agency websites or consult legal experts.
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