Quick Hits

• The German Federal Labor Court held that blanket release clauses in employment contracts that entitle the employer to grant a release upon termination constitute an unreasonable disadvantage and are invalid.
• An employee’s interest in continuing employment until the termination of the employment relationship generally outweighs an employer’s interest in granting the employee a leave of absence in a terminated employment relationship until the expiration of the notice period.
• Exemption is also possible without a contractual basis if the employer’s interests worthy of protection preclude continued employment until the end of the notice period.

Nevertheless, an exemption may be justified if, in the specific case, the employer’s overriding interests worthy of protection conflict with the employment relationship, the BAG said.

Case Background

The employee had been working as a regional manager in the field sales department since January 2022 and used a company car, which was also provided for private use. The standard employment contract contained a clause stating that the employer was entitled to release the employee from work “upon or following the issuance of a notice of termination—regardless of which party issued it”—while continuing to pay compensation. After the employee resigned, the employer granted him leave and demanded the return of the company car. The employee returned the car but claimed compensation for loss of use in the amount of EUR 510 per month due to the withdrawal. The Oldenburg Labor Court (Arbeitsgericht (ArbG)) (Ref. No. 5 Ca 370/24) dismissed the claim, while the Lower Saxony Regional Labor Court (Landesarbeitsgericht (LAG)) ordered the employer to pay the compensation for loss of use (Ref. No. 5 SLa 249/25).

Decision

The BAG’s Fifth Senate opinion clarifies that the agreed-upon leave-of-absence clause, which provided for a blanket option for leave of absence upon termination, is subject to the review of standard terms and conditions under Section 307 (3) sentence 1 of the German Civil Code (Bürgerliches Gesetzbuch (BGB)) and is invalid under Section 307 (1) sentence 1 of the BGB.

Such a blanket clause deprives the employee of the constitutionally protected interest in employment until the end of the employment relationship. Such an interest generally outweighs the employer’s general interest in exemption. Nevertheless, in the opinion of the BAG, a release of the employee may be considered even without a contractual basis if, in the specific case, overriding employer interests worthy of protection precluded continued employment. Since this had not been examined by the LAG, the legal dispute was referred back to the LAG. The BAG did not rule on compensation for loss of use.

Key Takeaways

It comes as little surprise that blanket leave-of-absence clauses in standard-form employment contracts are invalid. However, granting an employee a leave of absence following termination is still possible if, in the specific case, the employer’s overriding interests worthy of protection preclude continued employment. This raises the question of whether it is even necessary or sensible to include release clauses in employment contracts, since the decision will come down to a balancing of interests on a case-by-case basis anyway. Nevertheless, in our view, appropriate release clauses in employment contracts are sensible, as they increase the acceptance of such releases in practice. However, such clauses do not replace a balancing of interests in individual cases. The employer will only be able to effectively withdraw benefits, such as the private use of a company car, during the leave of absence if such a withdrawal is also effective in the specific case, i.e., if the employer has an overriding interest in the leave of absence. This may be the case, for example, if an employee moves to a competitor and trade and business secrets are at risk, or if an employment opportunity no longer exists due to the elimination of the position. In practice, employees rarely object to the leave of absence, but they are more likely to do so if benefits are withdrawn during the leave.

Outlook

With this decision, the BAG confirmed the employee’s overriding interest in continued employment until the end of the notice period. Since the legal dispute has been referred back to the LAG, it remains to be seen which specific employer interests could justify a suspension in this particular case and whether such interests existed. It will then also be determined whether the employer must pay compensation for loss of use due to the withdrawal of the company car.

Ogletree Deakins’ Berlin and Munich offices will continue to monitor developments and will post updates on the Cross-Border and Leaves of Absence blogs as additional information becomes available.

Dr. Ulrike Conradi is managing partner in Ogletree Deakins’ Berlin office.

Lela Salman, a law clerk in Ogletree Deakins’ Berlin office, contributed to this article.

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Quick Hits

• In Larkin v. Total Quality Logistics, LLC, a logistics firm was sued after it denied a work-from-home accommodation request from an employee with a high-risk pregnancy.
• A jury found the accommodation denial contributed to the baby’s premature birth and death.
• The case shows how an accommodation denial may create liability for employers if they aggravate a worker’s medical condition.

Background on the Case

In 2021, a claims associate for a Cincinnati-based logistics firm, Total Quality Logistics, LLC (TQL), was pregnant and required bed rest after a related surgery. When she requested to work from home and provided medical documentation, the company denied the request and placed her on an unpaid leave of absence instead. She quickly resumed work in the office.

About two weeks later, the company reconsidered and granted her request to work from home. The same day, the employee entered very premature labor and gave birth to her daughter. The baby died shortly after being born.

In February 2023, the baby’s estate filed a wrongful death lawsuit in the Hamilton County, Ohio, Court of Common Pleas. A jury awarded the estate $22.5 million on March 18, 2026. The court denied the plaintiff’s request for punitive damages, holding that punitive damages are not available for a “purely wrongful death action.”

Americans with Disabilities Act and Pregnant Workers Fairness Act

There are several obligations and remedies that employers must consider when evaluating a pregnant employee’s requests for accommodation.

Some pregnancy complications may be covered under the Americans with Disabilities Act (ADA), which requires employers to accommodate employees with known physical or mental disabilities. For example, pregnancy accommodations may include remote work, light duty, reduced hours, permission to sit and avoid lifting, and time off to attend prenatal medical appointments.

An employee can bring a failure-to-accommodate claim if the accommodations offered do not reasonably allow the employee to perform the essential functions of their job with the established medical restrictions of the employee. An employee also can sue under the ADA if an employer’s delay in an accommodation decision is unreasonable, is unjustified, or causes a breakdown in the interactive process.

In addition, the Pregnant Workers Fairness Act (PWFA) requires employers to provide reasonable accommodations for pregnancy, childbirth, and related medical conditions, even when the pregnancy does not qualify as a disability under the ADA. The PWFA is more expansive in the right to accommodation for pregnant employees. For example, a pregnant employee may be entitled to temporarily removing essential functions of her position. Employers are prohibited from harassing, discriminating against, or retaliating against a worker for requesting an accommodation under the ADA or the PWFA.

To legally justify denying a reasonable accommodation request, an employer must demonstrate the accommodation would impose an undue hardship, meaning a substantial cost or difficulty, as determined by factors such as the nature and cost of the accommodation, the employer’s financial resources, and the impact on business operations.

Next Steps

The employer in this case may appeal the judgment. Nonetheless, this case shows how an employer can be held liable for negligence or wrongful death if its accommodation denial results in an aggravated medical condition, injury, or death. The eight-figure jury award here is far from typical in litigation concerning pregnancy accommodations in the workplace, but it serves as a reminder that the stakes of these employment decisions are very high, and mistakes can lead to significant consequences for both employee and employer.

Thus, employers may wish to train supervisors on the accommodation process and what is required under the PWFA and the ADA. Employers also may wish to carefully document their legitimate business reasons for denying any accommodation requests. If an employer applies its attendance, remote work, and accommodation policies consistently and fairly, it may reduce the risk of discrimination claims based on gender, age, and other protected characteristics.

Ogletree Deakins’ Leaves of Absence/Reasonable Accommodation Practice Group will continue to monitor developments and will post updates on the Employment Law, Leaves of Absence, and Ohio blogs as additional information becomes available.

H. Devon Collins is a shareholder in Ogletree Deakins’ Columbus office.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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Quick Hits

• The DOL proposed a six-factor safe harbor to meet a fiduciary’s duty of prudence when selecting designated investment alternatives under participant-directed defined contribution plans.
• The proposed regulation does not apply to brokerage windows or self-directed brokerage accounts under defined contribution plans. 
• This proposal follows President Trump’s executive order aimed at increasing access to alternative assets and reversing earlier Biden-era guidance that discouraged such investments due to risk concerns. 
• By clarifying the fiduciary process affording discretion to plan fiduciaries to select investments, the DOL hopes the courts will follow through with deference. 

The proposed rule, titled “Fiduciary Duties in Selecting Designated Investment Alternatives,” establishes a process-based safe harbor for fiduciaries’ duty of prudence under the Employee Retirement Income Security Act (ERISA) in selecting investment options for participant-directed individual account plans. The proposed rule aims to “alleviate certain regulatory burdens and litigation risk” with alternative investments—including alternative assets such as private equity, real estate, digital assets like cryptocurrency, commodities, infrastructure, and lifetime income strategies.

The DOL accomplishes this by removing the focus on alternative investments and returning to the U.S. Securities and Exchange Commission’s (SEC) 1979 investment duties regulation, expanding on that guidance. If the proposal is finalized, it would provide greater clarity and reduce the legal risk for plan fiduciaries that include alternative assets in employer-sponsored retirement plans.

Shifting Policy

The proposal comes on the heels of President Donald Trump’s Executive Order (EO) 14330 “Democratizing Access to Alternative Assets for 401(k) Investors,” issued on August 7, 2025, which asserted federal policy to open 401(k) investments to alternative assets. The EO directed the DOL to reexamine its guidance on fiduciary duties under ERISA related to alternative investments and clarify its position on alternative assets and what processes fiduciaries would need to open retirement funds to alternative investment options.

EO 14330 marked a policy shift from the Biden administration’s 2021 rescission of guidance issued during President Trump’s first term, which had signaled comfort with private equity investment, and other Biden-era sub-regulatory guidance that had cautioned retirement plans against investment in cryptocurrency and other products tied to the value of cryptocurrencies out of risk concerns.

In the past, most 401(k) plans have shied away from alternative assets due to fiduciary concerns, regulatory risk, and litigation liability. The proposed rule notes research from the Plan Sponsor Council of America showing that more than 500 fee cases have been filed since 2016, resulting in more than $1 billion in litigation settlements paid by plan sponsors. The proposed rule notes that “several stakeholders” submitted letters to the DOL following EO 14330 expressing support for “reducing excessive litigation,” particularly an increase in class action litigation in recent years.

The Proposed Rule: Safe Harbor Process

Asset-Class Neutral

While EO 14330 directed the DOL to provide guidance on specific alternative assets, the proposed rule takes a broader approach, avoiding categorical prohibitions on certain alternative assets and focusing on plan fiduciaries having “maximum discretion” to select investments that further the plan’s purposes. The proposed rule “does not require or restrict any specific type of designated investment alternative, except insofar as a designated investment alternative might be otherwise illegal.” If the safe harbor is met, a fiduciary selecting plan investments is presumed to have met his or her fiduciary duty of prudence under ERISA Section 404(a)(1)(B). The DOL proposed regulation acknowledges that selecting designated investment alternatives for plans is a fiduciary act. The DOL clarifies, however, that the duty of prudence neither requires nor restricts any type of investment – it is asset-class neutral.

Six Safe Harbor Factors

The proposed rule would introduce a set of six non-exhaustive factors for plan fiduciaries: (1) performance, (2) fees, (3) liquidity, (4) valuation, (5) benchmarking, and (6) the complexity of the designated investment alternatives. When a fiduciary follows the processes described in making investment decisions, those decisions would be “presumed to be reasonable” and “entitled to significant deference.”

1. Performance. The fiduciary would need to consider “a reasonable number of similar alternatives” and determine the investment’s risk-adjusted expected returns for the purposes of the plan.
2. Fees. The fiduciary would need to “consider a reasonable number of similar alternatives and determine that the fees and expenses of the designated investment alternative are appropriate, taking into account its risk-adjusted expected returns and any other value the designated investment alternative brings to furthering the purposes of the plan.” Interestingly, other value means benefits, features and services other than investment returns, which could arguably permit higher fees for services aiding participants or administering the plan.
3. Liquidity. The fiduciary would need to consider and determine whether a “designated investment alternative will have sufficient liquidity to meet the anticipated needs of the plan at both the plan and individual levels.” Notably, the proposed rule recognizes that because 401(k) plans are long-term retirement savings vehicles, “there is no requirement that a fiduciary select only fully liquid products,” and a prudent process may lead to a decision to sacrifice some liquidity in pursuit of additional risk-adjusted return.
4. Valuation. The fiduciary would need to “appropriately consider and determine that the designated investment alternative has adopted adequate measures to ensure that the designated investment alternative is capable of being timely and accurately valued in accordance with the needs of the plan.”
5. Performance Benchmark. The fiduciary would need to consider “each designated investment alternative has a meaningful benchmark and compare the risk-adjusted expected returns of the designated investment alternative to the meaningful benchmark.”
6. Complexity. The fiduciary would need to “appropriately consider the complexity of the designated investment alternative and determine that it has the skills, knowledge, experience, and capacity to comprehend it sufficiently to discharge its obligations under ERISA and the governing plan documents or whether it must seek assistance from a qualified investment advice fiduciary, investment manager, or other individual.” This could be viewed as an admonishment to seek the advice of a professional.

What the Proposed Rule Means for Plan Sponsors and Fiduciaries

The proposed rule would expand potential investment options for retirement plans by reducing potential liability for plan sponsors and fiduciaries. By confirming that fiduciaries have maximum discretion to select from any type of investment, including alternative assets, the proposed rule opens the door for plan sponsors to consider adding private equity, real estate, digital asset funds, and other alternatives to their plan menus without the fear that such selections will automatically invite regulatory attention or litigation.

However, the proposed rule would not completely bar potential claims by plan participants arising from risky investment decisions or excessive fees associated with alternative assets. Fiduciaries would also continue to be “prohibited from selecting a designated investment alternative that is otherwise illegal.” Further, while the proposed rule seeks to provide fiduciaries with a safe harbor, the Supreme Court of the United States has removed Chevron deference for agency rules, meaning the rule would be afforded a lower level of deference. The DOL acknowledged that the proposed rule would provide “persuasive authority regarding what constitutes a prudent process.”

Next Steps

The DOL is inviting comments on the proposed rule, specifically on the six safe harbor factors outlined with regard to best practices for participant-directed individual accounts and established investment principles, and on potential additional factors. Comments will be accepted for sixty days after the NPRM is formally published in the Federal Register.

In the meantime, employers may want to review their investment committee processes and documentation practices in light of the proposed six safe harbor factors. This safe harbor will apply to all types of investments, not just alternative assets.

Ogletree Deakins’ Employee Benefits and Executive Compensation Practice Group will continue to monitor developments and will provide updates on the Employee Benefits and Executive Compensation blog as additional information becomes available. An analysis of the safe harbor examples in the DOL proposed regulation will be provided in a future article.

This article and more information on how the Trump administration’s actions impact employers can be found on Ogletree Deakins’ Administration Resource Hub.

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Quick Hits

• All EU member states are required to transpose the EU Pay Transparency Directive into national law by 7 June 2026.
• Ireland currently proposes to introduce substantial changes to existing obligations under the Employment Equality Acts and the Gender Pay Gap Information Act 2021.
• Department of Children, Disability and Equality officials are currently developing a General Scheme to transpose the remaining elements of the directive into Irish law.
• Ireland recently indicated that it is unlikely to transpose the directive by 7 June 2026.

As the 7 June 2026 deadline approaches, it is becoming increasingly clear that many EU member states will not complete transposition on time. Ireland is among those that have already signalled a delay, with official parliamentary materials confirming that legislation to transpose the remaining elements of the directive is still being developed.

Against that background, the Department of Children, Disability and Equality (DCDE) has indicated that employers will not be penalised for not having all elements of the directive completed in June 2026. However, employers that fail to prepare now for implementation may find themselves inadequately prepared and at risk for noncompliance with the directive’s requirements as they are rolled out.

The directive aims to strengthen the principle of “equal pay for equal work or work of equal value.” Employers will be required to disclose the starting salary or salary range for a role in the job advertisement (this is more prescriptive than the directive). Employers will no longer be permitted to ask candidates about their previous pay history. These measures are designed to prevent historical pay inequalities from being carried forward and to ensure that salary decisions reflect the value of the role rather than an individual’s past earnings.

The directive also strengthens employees’ rights to access pay information. Employees will be entitled to request details of their own pay level as well as the average pay levels of colleagues performing the same work or work of equal value, broken down by gender. Employers must ensure that any pay differences can be objectively justified.

The European Union’s European Institute for Gender Equality (EIGE) is currently introducing a draft toolkit for gender-neutral job evaluation and classification. The DCDE is expected to hold workshops in 2026 to assist employees in carrying out job evaluation assessments.

In Ireland, employers with fifty or more employees are already required to report on their gender pay gap. The directive takes this further, introducing more detailed reporting categories and a phased timeline, with organisations with 150 or more employees required to report every three years and organisations with 250 or more employees required to report annually from 7 June 2027. Employers with one hundred or more employees will be required to report annually by 7 June 2031.

Employers are encouraged to stay informed about the implementation process in their respective jurisdictions. Information and updates on the progress of the directive’s implementation across the European Union can be found using Ogletree Deakins’ Member State Implementation Tracker.

Further information can also be found by listening to our podcast, “Understanding the EU Pay Transparency Directive: What Employers Need to Know.”

Ogletree Deakins’ London office, Pay Equity Practice Group, and Workforce Analytics and Compliance Practice Group will continue to monitor developments and will provide updates on the Cross-Border, Pay Equity, and Workforce Analytics and Compliance blogs as additional information becomes available.

Daniella McGuigan is a partner in the London office of Ogletree Deakins and co-chair of the firm’s Pay Equity Practice Group.

Lorraine Matthews, a practice assistant in the London office of Ogletree Deakins, contributed to this article.

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Quick Hits

• Smart glasses, which can record audio, video, and capture facial recognition data, present significant employment law challenges for retailers.
• Overly broad recording bans can be illegal under the National Labor Relations Act.
• Retail employers may want to engage in an interactive process for accommodation requests related to smart glasses to avoid potential lawsuits under the Americans with Disabilities Act.

The Recording Problem: Know the State Laws

Unlike cellular phones, which are typically held in plain sight, smart glasses resemble ordinary glasses, making them far less conspicuous. Smart glasses manufacturers recommend turning off the glasses in sensitive spots like medical offices, locker rooms, and bathrooms. Employers, likewise, may want to make these expectations crystal clear. Enforcement, however, is a challenge and often relies on the honor system. This creates opportunities for legal risk and the need for mitigation. To date, smart glasses cannot be “bricked” like a cellular telephone, and their applications are not readily visible to anyone other than the wearer.

One of the areas of significant legal risk concerns smart glasses’ ability to record video and audio without the awareness and consent of the recorded subjects. About a dozen states require everyone’s consent before recording a conversation. If an employee records a meeting, conversation, or other interaction without telling participants and obtaining consent, both the employee and the company could face lawsuits or even criminal charges. In addition to retailers, health and financial industry employers may want to ensure that employees handling confidential information are especially careful given the stringent regulation of privacy in these industries.

Biometric data is also a crucial factor to consider. Smart glasses can capture facial recognition and eye tracking data, which is an untested area under the Genetic Information Nondiscrimination Act, and may trigger stricter state laws, such as Illinois’s Biometric Information Privacy Act (BIPA). While liability may not attach to the employer where the wearer is a low-level employee, employees who can be argued agents of the company may create bigger risks. Companies that collect this data without proper notice and consent may be subject to steep statutory damages.

Recording Policies

Tempted to just ban all recording devices? Hold that thought.

Under the National Labor Relations Act (NLRA), overly broad no-recording policies can be illegal. The National Labor Relations Board (NLRB) has opined that broad policies may interfere with employees’ rights to engage in protected activities. Any recording ban needs solid business justifications, like protecting privacy or confidential financial information.

Disability Accommodations

Employees are already suing over the right to wear smart glasses as a medical device. In one recent case, an employee whose doctor had prescribed smart glasses to help her with her light sensitivity and astigmatism claimed her employer discriminated against her by denying her request to use them.

Retailers selling AI-assisted medical products have stated that smart glasses prescribed for medical purposes may serve a range of vision-related functions, from electronic magnification and AI-driven object recognition to hands-free navigation assistance, and may be tailored to address specific conditions such as age-related macular degeneration, diabetic retinopathy, or retinitis pigmentosa.

While the Americans with Disabilities Act of 1990 (ADA) does not entitle employees to the accommodation of their choice where a comparable accommodation exists, blanket bans on smart glasses could backfire where a physician specifically prescribes smart glasses. This makes it more important for employers to engage in an interactive process when employees request accommodation under the ADA.

Practical Tips

Retail employers may want to consider the following tips when addressing the use of smart glasses in the workplace:

• creating clear policies specifically addressing smart glasses and recording-capable wearables,
• updating confidentiality agreements and the employee handbook to cover wearable tech risks,
• assessing how these smart devices interact with legal compliance obligations, and
• building a process for handling accommodation requests related to smart glasses.

Bottom line: Smart glasses are here to stay. Employers that proactively address these issues now will save themselves significant headaches in the future.

Ogletree Deakins’ Retail Industry Group will continue to monitor developments and will provide updates on the Retail and Technology blogs as additional information becomes available.

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Quick Hits

• Virginia’s General Assembly has passed legislation that would prohibit noncompete agreements for healthcare professionals.
• HB1 and SB1 would establish a multiyear schedule to increase Virginia’s minimum wage to $15 per hour by January 1, 2028, with further adjustments based on the Consumer Price Index starting in 2029.
• SB258 and SB790 would introduce workplace protections and health insurance coverage for menopause and perimenopause.

Prohibiting Healthcare Noncompete Agreements (Senate Bill (SB) 128)

Following the trend of expanding employee protections, SB128 seeks to broaden the existing ban on “low-wage” covenants not to compete to include all “health care professionals.” Current Virginia law restricts noncompete agreements only for “low-wage employees” or those classified as nonexempt under the Fair Labor Standards Act (FLSA). SB128, however, would prohibit employers from entering into, enforcing, or threatening to enforce such agreements with any person licensed, registered, or certified by the Boards of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work.

However, SB128 contains the following exemptions:

• Nondisclosure agreements that prohibit the misappropriation of “certain information to which an employee has access,” such as trade secrets and proprietary confidential information.
• Noncompetition or other restrictive covenants entered into in connection with the sale of a healthcare business, provided the restriction is reasonable in scope, duration, and geography.
• Provisions requiring repayment for “recruitment-related costs, including relocation expenses, signing or retention bonuses, and other remuneration provided to induce relocation or establishment of a practice in a specified geographic area, as well as recruiting, education, or training expenses,” would remain enforceable as related to healthcare professionals employed for less than five years.
• Nonsolicitation agreements that prohibit departing professionals from soliciting or attempting to solicit their employer’s clients or prospective clients: (1) with whom the departing healthcare professional had “material contact during employment”; and (2) for which the departing healthcare professional would be providing “products and services that are the same as or substantially similar to those provided by the employer.”

SB128 would authorize a private civil right of action to void any violative agreement and recover liquidated damages, lost compensation, damages, and reasonable attorneys’ fees and costs, in addition to the $10,000 civil penalty already in place.

If signed by Governor Spanberger, SB128 will take effect July 1, 2026.

Minimum Wage Increase (House Bill (HB) 1 and SB1)

While Virginia’s minimum wage currently sits at $12.77 following recent inflation adjustments, HB1 and SB1 would establish a multiyear schedule for further increases. Specifically, the legislation would mandate the following schedule for all Virginia employers:

• $13.75 per hour effective January 1, 2027
• $15.00 per hour effective January 1, 2028

After January 1, 2029, Virginia employers would be required to pay a minimum wage adjusted annually by reference to the Consumer Price Index published by the U.S. Department of Labor’s Bureau of Labor Statistics. Governor Spanberger has signalled a willingness to sign this legislation.

Salary History and Wage Transparency (HB636 and SB215)

Seeking to amplify existing pay equity protections, Virginia is poised to further regulate the considerations Virginia employers are permitted to make when setting pay. Specifically, HB636 and SB215 would prohibit covered employers from: (1) seeking or requiring a prospective employee’s wage or salary history, or (2) relying on prior pay information when setting pay or making hiring decisions. However, these bills include a narrow exception that would permit the voluntary disclosure of wage or salary histories by prospective employees, but only after receiving an offer of employment containing an initial compensation offer. In such instances, the wage or salary history may only be used to support or confirm a wage or salary higher than the initial offer.

Also, and akin to several states with similar provisions, these bills would require that public or internal job postings—including those for promotions or transfers—include a specific wage or salary range. Relatedly, all wage or salary ranges would have to be set in “good faith” and in consideration of the breadth of such range.

HB636 and SB215 would allow aggrieved employees to pursue individual or collective actions for alleged violations, with successful actions carrying statutory damages of between $1,000 and $10,000, or actual damages, whichever is greater, as well as attorneys’ fees, costs, and “any other legal and equitable relief as may be appropriate.” Posting-related claims would be subject to a fifteen-day notice and cure requirement before an action may be brought.

If signed by Governor Spanberger, these requirements will take effect on July 1, 2026.

Virginia Human Rights Act Expansion (SB637)

SB637 would expand the statute of limitations for Virginia Human Rights Act (VHRA) claims and redefine “employer” to potentially subject even very small businesses to claims. At present, the VHRA applies mostly to employers with fifteen or more employees. SB637 would expand this coverage to employers with five or more employees.

Additionally, SB637 would modify the current 300-day limitations period to permit written complaints with the Office of Civil Rights within two years from the date of the alleged discriminatory practice.

This bill would take effect on July 1, 2026.

Protections for Menopause and Perimenopause (SB258 and SB790)

The General Assembly passed a pair of bills adding both workplace protections and health insurance regulations covering menopause as a protected condition. These measures, SB258 and SB790, would introduce new mandates for both workplace accommodations and health insurance coverage.

• SB258 would amend the VHRA to include “menopause or perimenopause” as a protected characteristic, thereby prohibiting employers from discriminating against employees based on these conditions. SB258 would expressly require employers to provide reasonable accommodations for known limitations related to menopause, unless doing so would impose an “undue hardship” on the business.
• SB790 would require health insurers to provide coverage for “medically necessary” treatments for menopause and perimenopause symptoms, such as hot flashes, bone density loss, and sleep disruptions.

If signed into law, SB258 will take effect July 1, 2026. Meanwhile, the insurance mandates under SB790 would apply to policies issued or renewed on or after January 1, 2027.

Au Pair Exemption (SB28)

SB28 would expand Virginia’s overtime requirements to include domestic workers, such as housekeepers and nannies. If signed by Governor Spanberger, these changes will take effect on July 1, 2027.

Ogletree Deakins’ Richmond office will continue to monitor the progress of these bills and will post updates on the Healthcare, Leaves of Absence, Pay Equity, Unfair Competition and Trade Secrets, Virginia, and Wage and Hour blogs as additional information becomes available.

J. Clay Rollins is a shareholder in the Richmond office of Ogletree Deakins.

Sebastian L. Brana is an associate in the Richmond office of Ogletree Deakins.

Sam Sylvester, an administrative assistant in the Richmond office of Ogletree Deakins, contributed to this article.

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Mullin Confirmed. On March 23, 2026, the U.S. Senate confirmed Markwayne Mullin as U.S. secretary of homeland security by a vote of 54–45. Democratic Senators John Fetterman (PA) and Martin Heinrich (NM) voted in favor of Mullin, while Rand Paul (KY) was the lone Republican to vote against him. Following the confirmation vote, Mullin, the onetime junior senator from Oklahoma, resigned from the Senate. He was sworn in as secretary of homeland security by Attorney General Pam Bondi on March 24, 2026, in an Oval Office ceremony hosted by President Donald Trump.

At the Buzz, we are most interested in the potential impact that Mullin may have on the employment-based immigration policies emanating from U.S. Citizenship and Immigration Services (USCIS) and Immigration and Customs Enforcement (ICE), which are both part of U.S. Department of Homeland Security (DHS). During his time in Congress, in both the U.S. Senate and U.S. House of Representatives, Mullin did not play a significant role in advancing immigration legislation. In addition, because current immigration policy decisions are likely to be predominantly driven by subagency leaders (such as Joseph Edlow, director of USCIS) and the White House, the Buzz expects Mullin’s impact on employment-based immigration policies to be minimal. Further, regarding the current funding lapse at DHS and the current negotiation stalemate in Congress, the Buzz wonders whether Mullin’s presence at the agency may serve as a catalyst for dealmaking. (Today is day forty-one of the DHS shutdown.)

DOL Proposes Increase to Prevailing Wages for Immigration Programs. The U.S. Department of Labor’s (DOL) Employment and Training Administration has issued a notice of proposed rulemaking (NPRM), titled, “Improving Wage Protections for the Temporary and Permanent Employment of Certain Foreign Nationals in the United States.” The proposal would amend regulations implementing the Permanent Labor Certification (PERM) program and Labor Condition Applications (LCAs) to increase the prevailing wage levels that must be paid to EB-2 and EB-3 employment-based immigrant visas (via PERM), as well as H-1B, H-1B1, and E-3 nonimmigrant visa holders. The proposed increases, based on the Occupational Employment and Wage Statistics (OEWS) wage survey administered by the DOL’s Bureau of Labor Statistics (BLS), are as follows:

According to the NPRM, “The Department is proposing this rule because the current methodology for setting prevailing wages often allows employers to pay alien workers significantly less than what similarly qualified U.S. workers earn for the same jobs in the same area of intended employment.” During the first Trump administration, the DOL promulgated a similar rule, which was successfully challenged in federal court and subsequently withdrawn by the Biden administration. The DOL is also pursuing this latest effort because it was instructed to do so in President Trump’s H-1B proclamation. Brian D. Bumgardner and Philip K. Sholts have additional details.

White House Releases AI Policy Framework. Late last week, the White House published its National Policy Framework for Artificial Intelligence. The comprehensive outline provides instructions for Congress to develop AI-related legislation that, among other areas, protects children and ensures intellectual property rights, all while protecting free speech and encouraging innovation. The Framework discourages the creation of new federal agencies and instead advises that the “development and deployment of sector-specific AI applications” should be overseen by “existing regulatory bodies with subject matter expertise and through industry-led standards.” As for AI’s impact on the workplace, the Framework encourages training, education, and apprenticeships, but does not advocate for any federal laws that would create new causes of action. Finally, to address the potential growing patchwork of state and local AI-related laws, the Frameworks states, “Congress should preempt state AI laws that impose undue burdens to ensure a minimally burdensome national standard consistent with these recommendations, not fifty discordant ones.” Danielle Ochs, Jennifer G. Betts, Patty Shapiro, and Zachary V. Zagger have the details.

Bipartisan House Bill Would Codify OPT. Representatives Sam Liccardo (D-CA), Jay Obernolte (R-CA), and Raja Krishnamoorthi (D-IL) have introduced the “Keep Innovators in America Act” (H.R. 8013) to codify the Optional Practical Training (OPT) program. OPT provides F-1 student visa holders with one year of work authorization after graduation, and an additional two years if they graduate with a STEM degree. However, while the U.S. Court of Appeals for the District of Columbia Circuit has ruled that the OPT program is lawful under the Immigration and Nationality Act, its regulatory structure is not expressly mandated by the statute. The Keep Innovators in America Act would change this by amending the INA to explicitly authorize the OPT program. In its most recent Unified Agenda of Regulatory and Deregulatory Actions, the administration has indicated that it will issue a proposal to amend the existing OPT “regulations to address fraud and national security concerns, protect U.S. workers from being displaced by foreign nationals, and enhance the Student and Exchange Visitor Program’s capacity to oversee the program.”

Associate Justice Charles Evans Whittaker. On March 25, 1957, Charles Evans Whittaker (1901–1973) was sworn in as an associate justice of the Supreme Court of the United States. A native Kansan, Whittaker dropped out of high school in the ninth grade to work on the family farm. After developing an interest in the law, Whittaker returned to night school to earn his high school degree while also taking law classes at the Kansas City School of Law (now the University of Missouri–Kansas City School of Law). Though not a well-known Supreme Court justice, Whittaker nevertheless had an interesting career:

• During Whittaker’s time at law school, future U.S. President Harry S. Truman was a classmate. (Truman never completed law school, though in 1996 was granted a posthumous honorary law license by the Supreme Court of Missouri.)
• Prior to being elevated to the Supreme Court, Whittaker first served as a judge on the U.S. District Court for the Western District of Missouri, as well as the U.S. Court of Appeals for the Eighth Circuit. He was the first judge to serve on a federal district court, a federal court of appeals, and the Supreme Court of the United States.
• Whittaker retired from the Court in 1962, after suffering a nervous breakdown during the deliberation surrounding the Baker v. Carr decision.

The federal courthouse in Kansas City—the Charles Evans Whittaker Courthouse, which is home to the U.S. District Court for the Western District of Missouri—is named in Whittaker’s honor.

The Buzz will be on hiatus next week but will publish again on April 10, 2026.

Quick Hits

• Twenty states and the District of Columbia recently filed suit in the U.S. District Court for the District of Massachusetts, challenging the USDA’s new funding conditions related to anti-DEI, gender ideology, and immigration requirements.
• Similar certification requirements are emerging across federal agencies, including a certification recently proposed by the U.S. General Services Administration (GSA).
• Federal grant recipients and contractors may wish to evaluate their DEI-related programs and monitor these developments, given the potential for significant False Claims Act and criminal liability exposure.

USDA Conditions

On December 31, 2025, the USDA released an updated document outlining the terms and conditions for federal funding for various organizations. The conditions, which apply to every USDA grant, cooperative agreement, and mutual interest agreement, encompass arenas such as nutrition assistance, agricultural research, forestry and firefighting, land-grant university funding, and 4-H youth programs.

The document contains four funding conditions that are being challenged thusly:

• The antidiscrimination policy conditions require recipients to certify compliance with “all federal antidiscrimination laws, regulations, and policies,” including specific executive orders, but do not define the relevant “policies” or limit the time for compliance.
• The gender ideology condition prohibits the use of funds that “promote gender ideology,” but does not explain what activities this encompasses.
• The sports condition prohibits directing funds toward programs that “deprive women and girls of fair athletic opportunities” or permit “male competitive participation in women’s sports,” without defining those terms.
• The immigration condition prohibits directing funds toward programs that “allow illegal aliens to obtain taxpayer-funded benefits,” without defining “benefits” or explaining the scope.

The 2026 conditions label these requirements as material “conditions of payment” going to “the essence of the federal award,” and the USDA has expressly threatened False Claims Act liability for noncompliance.

Lawsuit Details

The plaintiffs—a coalition of twenty U.S. states and the District of Columbia—have sued the USDA, asserting six causes of action arising under the Spending Clause of the U.S. Constitution and the Administrative Procedure Act (APA). The plaintiffs allege in their complaint that the conditions are vague, coercive, unrelated to the federal interest in the underlying programs, and in violation of the Constitution.

The plaintiffs also allege the conditions are arbitrary, capricious, and beyond the USDA’s statutory authority for mandatory entitlement programs (such as the Supplemental Nutrition Assistance Program (SNAP)), wherein Congress prescribed eligibility criteria, leaving no room for additional conditions. It claims the conditions were imposed without required notice-and-comment rulemaking and conflict with federal statutes such as 8 U.S.C. § 1615, which mandates school lunch eligibility, regardless of immigration status.

GSA Action

The USDA’s conditions are part of a broader, government-wide effort to embed anti-DEI compliance requirements into federal funding relationships. On February 18, 2026, the GSA released a draft revised Supporting Statement, proposing a DEI-related certification that would be added to the SAM.gov registration process for all entities receiving federal financial assistance.

The GSA certification implements Executive Order (EO) No. 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,“ and the U.S. attorney general’s July 2025 memorandum, “Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination.” A parallel certification for federal contractors through the Federal Acquisition Regulation (FAR) is expected in the near future. Public comments on the GSA proposal are due by March 30, 2026.

The GSA certification shares key features with the USDA conditions. Both impose broad, anti-DEI and immigration-related compliance requirements, and both carry False Claims Act liability for noncompliance. However, the GSA certification goes further by imposing potential criminal liability on individual signatories.

There are other notable differences. While the USDA conditions use vague, undefined terms like “gender ideology” and “fair athletic opportunities,” the GSA certification provides specific examples of prohibited practices, such as race-based scholarships, preferential hiring, and “diverse slate” policies, though it focuses narrowly on race and color, omitting other protected categories. The USDA conditions were also imposed unilaterally, whereas the GSA certification is subject to a public comment period.

Both the USDA and GSA actions implement the same set of executive orders, particularly EO 14173 and EO 14168, and are illustrative of a broader trend. Federal agencies across the government are increasingly incorporating anti-DEI certification and compliance requirements into their funding agreements and procurement processes. Grant recipients and federal contractors may wish to anticipate similar conditions, regardless of which agency administers their funding.

Next Steps

It remains unclear how Judge Myong J. Joun, the U.S. district judge assigned to the case, will rule. If Judge Joun grants an injunction, the administration may appeal the order or pursue a formal rulemaking process. If the USDA conditions remain in effect, organizations may face False Claims Act exposure for certifications that contain undefined or ambiguous terms. Either way, the USDA lawsuit is just one front in a broader effort. The GSA certification process and other agency-specific implementations of EO 14173 will continue separately, and a parallel FAR certification for federal contractors is expected.

Organizations that receive funding from any federal agency or hold federal contracts may wish to consider taking the following steps:

• submitting public comments on the GSA’s proposed certification by March 30, 2026, particularly organizations in healthcare, behavioral health, social services, and other fields where grants frequently target specific populations;
• conducting privileged audits of DEI-related programs, policies, and employment practices to evaluate their compliance posture before signing any certifications, given the False Claims Act and potential criminal liability exposure;
• monitoring agency-specific implementations of EO 14173 across the federal government, as similar certification conditions are likely to appear beyond USDA and GSA; and
• assessing whether the USDA’s sports and gender conditions, the GSA’s race-focused DEI certification, or future agency requirements could conflict with state or local laws protecting against discrimination based on gender identity, sexual orientation, or other characteristics.

Ogletree Deakins’ Diversity, Equity, and Inclusion Compliance, Government Contracting and Reporting, and Workforce Analytics and Compliance practice groups will continue to monitor developments and will provide updates on the Diversity, Equity, and Inclusion Compliance, Government Contracting and Reporting, and Workforce Analytics and Compliance blogs as additional information becomes available.

In addition, Ogletree Deakins will present a webinar on April 7, 2026, for federal contractors and subcontractors. Our speakers will include Simone R.D. Francis, a shareholder and co-chair of the firm’s Diversity, Equity, and Inclusion Compliance Practice Group, Joseph E. Ashman, a shareholder and co-chair of the firm’s Government Contracting and Reporting Practice Group, and Cameron W. Ellis, of counsel and a member of the Government Contracting and Reporting Practice Group. Register here.

This article and more information on how the Trump administration’s actions impact employers can be found on Ogletree Deakins’ Administration Resource Hub.

T. Scott Kelly is a shareholder in Ogletree Deakins’ Birmingham office, the co-chair of the firm’s Government Contracting and Reporting Practice Group, and the chair of the firm’s Workforce Analytics and Compliance Practice Group.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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Quick Hits

• Expanded worker protections are becoming the norm across nearly all jurisdictions.
• Reduced working hours are trending globally.
• AI regulation in HR is accelerating, from the EU AI Regulation affecting Germany, to Ontario’s AI disclosure rules in Canada, to the UAE’s use of AI for enforcement.
• Compliance and reporting standards continue to rise, including enhanced pay transparency requirements and contractor classification rules.

From sweeping labor code consolidations to new AI disclosure requirements, employers operating internationally will want to stay ahead of these critical changes. Below are the top ten employment law developments for global employers to watch.

1. Belgium: Notice Period Cap Reduces Termination Costs

A draft act, which is expected to pass soon, has been submitted to the Belgian Federal Parliament that would cap the notice period for employer-initiated terminations at fifty-two weeks (one year), even for very long-tenured employees. Previously, long-tenured employees could accrue notice periods of more than a year, creating substantial financial exposure for employers during workforce reductions or restructurings. This cap represents a meaningful reduction in termination costs, particularly for employees with fifteen or more years of service who historically would have qualified for much longer notice periods. However, because this cap would apply only to new contracts and would accrue with seniority, its practical effects would not materialize until those employees accumulate sufficient service. Employers may want to review their workforce planning models, termination cost projections, and restructuring scenarios in light of this potential change, as the savings compared to the previous regime can be substantial. For more details, see our podcast “Cross-Border Catch-Up: 2026 Employment Law Changes in Poland, Belgium, and the Netherlands.”

2. Brazil: Mental Health Reporting, Pending Critical Caselaw, and Immigration Updates

Under the updated Regulatory Norm No. 1 (NR‑1), employers must include mental health and psychosocial risks, such as burnout, harassment, and excessive working hours, in their Occupational Risk Management Programs. Formal enforcement of NR-1 begins on May 26, 2026.

Additionally, Brazil’s Federal Supreme Court is considering whether wage deductions for meal and transport allowances should be included in the base for the employer’s social security contributions, a decision that will affect payroll administration and employer costs.

Finally, Decree No. 12,657/2025 allows foreign nationals to perform short-term technical activities under a regular visitor visa, increasing flexibility for international business operations.

3. Canada: AI Disclosure, Pay Transparency, and Leave Expansions

Canada is introducing several significant changes across multiple provinces. Ontario now requires employers to disclose when artificial intelligence (AI) is used in hiring decisions. Employers must inform both candidates and employees when AI systems are deployed in recruitment, screening, assessment, or selection processes. Ontario is also mandating salary range disclosure in job postings, designed to address wage gaps and promote equal pay.

Leave entitlements are expanding: long-term illness leave has been extended in several provinces, and Saskatchewan has updated its maternity leave and introduced new leave for employees affected by domestic or sexual violence. Saskatchewan has also introduced new restrictions on employer tip withholding, effectively limiting management’s ability to retain or redistribute gratuities.

For more information, see our article, “New Year, New Laws: 2026 Updates in Canadian Employment Standards.”.

4. Germany: EU AI Regulation Hits HR Systems

Beginning in August 2026, the EU AI Regulation will take full effect in Germany, with significant implications for HR technology. The AI Regulation establishes strict requirements for “high-risk” AI systems, which include AI used in recruitment, performance management, task allocation, and promotion decisions. Employers will be required to conduct conformity assessments, maintain detailed documentation, ensure human oversight, and implement ongoing monitoring systems. Noncompliance can result in substantial fines.

Beyond AI, Germany has eliminated the rule that previously prevented employers from offering fixed-term contracts without objective justification to employees who had already worked for them after reaching statutory retirement age. As a result, employers may be able to extend working relationships with experienced employees without triggering indefinite employment obligations.

More changes include updates to social insurance contribution thresholds and expanded maternity protections. For more information, see our article, “Developments in German Employment Law for 2026.”

5. India: Historic Labor Law Consolidation

India is implementing one of the most ambitious labor law reforms in its history, consolidating twenty-nine statutes into four streamlined labor codes in an attempt to simplify compliance while significantly expanding worker protections.

• The Code on Wages establishes a universal minimum wage across all sectors and standardizes the definition of “wages” to close loopholes that allowed employers to artificially reduce provident fund and gratuity obligations through allowance structuring.
• The Industrial Relations Code formally recognizes fixed-term employment as a distinct employment category, raises the headcount threshold for employers required to seek government permissions before terminations from 100 to 300 employees (reducing the compliance burden for mid-sized companies), and introduces a mandatory Re-Skilling Fund to support displaced workers.
• The Social Security Code dramatically extends coverage to previously excluded categories including gig workers, platform workers, and workers in the unorganized sector, potentially bringing millions of additional workers into the social safety net.
• The Occupational Safety and Health Code extends formal health and safety protection to a broader range of employers and workers, while also restricting the use of contract labor for core business activities, effectively requiring direct employment for individuals who perform essential functions.

For more details, see our podcast, “Cross-Border Catch Up: Unpacking India’s Labor Law Shake-Up.”

6. Mexico: Workplace Violence Prevention and the Forty-Hour Workweek

Mexico has introduced two major reforms with far-reaching implications.

The first targets workplace culture: mandatory workplace violence prevention training is now required, accompanied by enhanced anti-discrimination obligations that may require employers to review and update their policies, training materials, and reporting mechanisms.

Second is the constitutional reform reducing the standard workweek from forty-eight hours to forty hours with one critical restraint: wages cannot be reduced for affected employees. Employers must maintain current salary levels while absorbing a roughly 17 percent reduction in working hours. Though the reform will be phased in through 2030 to give businesses time to adjust, employers may want to begin planning now for the financial and operational impacts.

For a comprehensive summary of what to look forward to in Mexican labor and employment law this year, see our articles, “Mexico’s Labor Law in 2026: Key Developments Include Workplace Violence Prevention and 40-Hour Workweek” and “Mexico Labor and Employment Law Roundup for 2025, and What’s Coming in 2026: A Brief Compliance Guide.”

7. Netherlands: Cracking Down on Contractor Misclassification

Until recently, employers in the Netherlands were waiting for the VBAR Act to go into effect. The VBAR Act was intended to introduce a more rigorous framework for evaluating whether a working relationship constitutes genuine independent contractor status or disguised employment. In early March 2026, however, the Cabinet of the Netherlands decided to abandon most of the VBAR Act. While the Cabinet may retain portions of the VBAR Act, such as the legal presumption that workers earning below EUR 38 per hour are employees, it is expected that the Cabinet will soon introduce a new framework for evaluating employment status called the Self-Employed Act. Until then, employers will want to refer to the Deregulation of Labour Relations Assessment Act (DBA) Act when assessing whether a working relationship qualifies as genuine self-employment.

Additionally, there is a renewed push for authorities to investigate potential misclassification of workers. Tax authorities and labor inspectorates are conducting coordinated audits and investigations, and employers found to have misclassified workers face potential back payments for social security, income tax withholding, payroll taxes, pension contributions, and vacation pay, often stretching back multiple years, plus penalties and interest on top. Companies relying heavily on independent contractors, freelancers, or intermediary arrangements may want to review those relationships to mitigate significant financial and legal exposure.

For more details, see our podcast, “Cross-Border Catch-Up: 2026 Employment Law Changes in Poland, Belgium, and the Netherlands.”

8. Poland: Service Length Recognition Expands

As of January 1, 2026, Poland expanded service length recognition rules, significantly impacting multiple employment entitlements. Time spent with predecessor entities and related companies, and in some cases other employers, now counts toward seniority, which directly affects notice periods (longer tenure = longer notice), severance entitlements (often based on length of service), and vacation accruals (which typically increase with tenure). Companies operating in Poland may want to review employment continuity for employees who transferred from related entities and recalculate entitlements under the new rules. Failure to properly recognize service can result in disputes over termination entitlements and leave calculations.

Employers must also update their personnel file practices to meet new standards on what information must be maintained, for how long, and what documentation must be provided to employees. For more details, see our podcast, “Cross-Border Catch-Up: 2026 Employment Law Changes in Poland, Belgium, and the Netherlands.”

9. UAE: Emiratisation Enforcement Intensifies

The UAE is significantly ramping up Emiratisation requirements and enforcement mechanisms. Companies with fifty or more employees must now meet a 10 percent Emirati quota in skilled roles, while those with twenty to forty-nine employees across fourteen designated sectors (including banking, insurance, telecommunications, and healthcare) must employ at least two Emiratis. Notably, the UAE government is deploying AI-powered surveillance systems to monitor compliance and detect quota avoidance schemes such as “ghost employees” or sham arrangements.

A new minimum wage of AED 6,000 per month (approximately USD 1,635) will apply to all Emirati employees. It takes effect on January 1, 2026, for new, renewed, and amended work permits, and on June 30, 2026, for existing employees. Penalties for noncompliance have increased dramatically (between AED 100,000 to one million per violation, or approximately USD 27,200 to 272,000), and courts can order employers to continue to pay affected Emirati workers for up to two months during investigations. The government is also considering fundamental reforms to the end-of-service gratuity system, potentially transitioning from the traditional lump-sum payment model to a defined contribution savings plan framework similar to pension systems in other jurisdictions. This would shift both the timing and structure of end-of-service obligations.

10. United Kingdom: The Employment Rights Act 2025 Takes Effect

The UK’s Employment Rights Act 2025 will fundamentally reshape employer obligations over the course of this year. The legislation creates a new Fair Work Agency to oversee enforcement, signaling a more aggressive regulatory approach. Key changes include:

• Statutory sick pay (SSP) will be a day-one entitlement with no waiting period and the lower earnings limit for SSP will be removed.
• Paternity and unpaid parental leave will also become available from the first day of employment, and paternity leave will be permitted after shared parental leave.
• Bereaved Partner’s Leave regulations come into force, providing a right to up to fifty-two weeks of leave where the child’s “primary carer” (usually the mother or other adoptive parent) has died within fifty-two weeks of the birth or adoption placement.
• Redundancy penalties will double, with the maximum penalty now reaching 180 days’ actual pay per employee (a significant increase from the previous ninety-day cap).

Whistleblowing protection will explicitly include disclosures related to sexual harassment. Further legislative changes under the Employment Rights Act 2025 are scheduled for October 2026. For more details, please see our article, “The Year Ahead in UK Employment Law: An Overview of Changes Scheduled in 2026.”

Additionally, the Data Use and Access Act (DUAA), expected to take effect in June 2026, introduces new complaint procedures with a thirty-day acknowledgment requirement.

These reforms represent one of the most significant expansions of worker rights in recent UK history.

Key Takeaways for Global Employers

Several clear themes emerge from these 2026 developments:

• Expanded worker protections are becoming the norm across nearly all jurisdictions, from day-one entitlements in the UK to gig worker coverage in India.
• Reduced working hours are trending globally, with Mexico’s forty-hour workweek reform part of a broader movement.
• AI regulation in HR is accelerating, from the EU AI Regulation affecting Germany, to Ontario’s AI disclosure rules in Canada, to the UAE’s use of AI for enforcement.
• Compliance and reporting standards continue to rise across the board, including enhanced pay transparency requirements and contractor classification rules.
• Employers with global operations may want to conduct a comprehensive review of their policies and practices in each jurisdiction to ensure compliance with these evolving requirements. Proactive preparation now may help avoid costly surprises later.

Ogletree Deakins’ Cross-Border Practice Group will continue to monitor developments and will post updates on the Cross-Border blog as additional information becomes available.

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Quick Hits

• Germany’s Federal Labor Court ruled that recurring seasonal allergies like hay fever may be considered a continuation of the same underlying condition rather than new illnesses.
• Employers can contest sick leave claims for recurring seasonal allergies if the employee has been absent for more than six weeks within the relevant periods, shifting the burden of proof to the employee.
• Employers are generally protected against liability for allergic reactions in the workplace if they respond appropriately to known health risks and do not act with intent to cause harm.

Pollen Allergy as a Potential Continuing Illness

Germany’s Federal Labor Court (Bundesarbeitsgericht (BAG)) addressed this issue in its decision of January 18, 2023 (Ref. No. 5 AZR 93/22). The court emphasized that the existence of “the same illness” within the meaning of Section 3(1) sentence 2 of the Continued Remuneration Act (Entgeltfortzahlungsgesetz (EFZG)) is not automatically excluded even in the case of “recurring (chronic) respiratory conditions.”

Hay fever is typically rooted in a permanent allergic condition that can recur seasonally and lead to incapacity to work. Different symptom presentations—such as sneezing fits, coughing, eye irritation, and difficulty concentrating—may therefore all stem from the same underlying condition.

Recommendations for Employers

Sick leave certificates for recurring seasonal illnesses and documented absences within the six-month and twelve-month periods set out in Section 3(1) sentence 2 of the EFZG are of legal significance. Where an employee has already been absent for more than six weeks during the relevant periods, and the circumstances—such as annual absences during pollen season—suggest a continuing illness, the employer may contest that each episode constitutes a “new” illness and refuse to continue paying remuneration.

In that case, the burden shifts to the employee to explain, in plain terms, the specific causes of the illness for the entire relevant period and to release the treating physicians from their duty of confidentiality. Sick leave certificates alone, ICD-10 codes, or notices from health insurers are not sufficient to meet this burden of explanation. If the employee fails to provide this information, a continuing illness may be assumed, with the result that no further claim for continued remuneration exists.

Protective Measures and Risk Assessment

Section 5(3) No. 2 of the Occupational Health and Safety Act (Arbeitsschutzgesetz (ArbSchG))—governing biological hazards—read in conjunction with the general duty of care under Section 3 of the ArbSchG and Section 618 of the German Civil Code (Bürgerliches Gesetzbuch (BGB)), may give rise to an obligation to address pollen in workplace risk assessments. Employers may want to include allergies in such assessments—even at office workplaces—because they represent real health risks that must be considered legally, regardless of their severity in individual cases or the absence of measurable thresholds.

Key Takeaways—Liability Risks

A decision of the Regional Labor Court of Rhineland-Palatinate (Landesarbeitsgericht Rheinland-Pfalz (LAG Rheinland-Pfalz)), 8th Chamber, dated June 14, 2016 (Ref. No. 8 Sa 535/15), demonstrates that employers are generally protected against liability for allergic reactions in the workplace, provided they respond appropriately to known health risks and have not acted with intent to cause harm. The burden of proof for intentional or grossly negligent conduct lies with the employee and is difficult to meet in practice. Below this threshold, the liability privilege under Section 104(1) of Book VII of the German Social Code (Sozialgesetzbuch (SGB VII)) applies.

Employers that take no protective measures despite knowing that their employees suffer from pollen allergies risk higher rates of absenteeism. However, fines under the Industrial Safety Regulation (Betriebssicherheitsverordnung) and civil liability risks are unlikely in practice.

Ogletree Deakins’ Berlin and Munich offices will monitor developments and post updates on the Germany and Leaves of Absence blogs as additional information becomes available.

Dr. Martin Römermann is a partner in the Berlin office of Ogletree Deakins.

Lela Salman, a law clerk in the Berlin office of Ogletree Deakins, contributed to this article.

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