Employment Law Issues Employers Need to Prepare for in 2025
by Steven I. Adler, Mandelbaum Barrett PC
As we move further into 2025, employers in the automotive and body shop industry must stay ahead of evolving employment laws to protect their businesses and remain compliant.
With legal trends shifting and regulatory changes on the horizon, staying informed is key to avoiding costly legal disputes. Here are the major employment law developments to prepare for in the coming year.
1. Increased Scrutiny on Data Retention and Spoliation
With an increasing reliance on digital documentation, courts are imposing stricter penalties on businesses that fail to preserve important records. Spoliation – intentional or negligent destruction of evidence – can lead to substantial fines and unfavorable legal outcomes. Employers should implement clear document retention policies and ensure litigation hold procedures are in place.
2. Pay Equity and Wage Transparency
Pay equity continues to be a pressing issue, with a growing number of lawsuits filed under New Jersey’s Diane B. Allen Equal Pay Act. Additionally, beginning June 1, 2025, businesses with 10 or more employees must disclose salary ranges and benefits in job postings. Employers should audit their pay structures to ensure compliance and fairness in compensation practices.
3. Mental Health Accommodations and Workplace Adjustments
Employee requests for mental health accommodations under the ADA and New Jersey Law Against Discrimination (NJLAD) are on the rise. This includes requests for modified work schedules, leaves of absence and adjustments to job duties. Employers should engage in the interactive process when handling these requests and document all decisions carefully.
4. Rising Litigation in Employee Terminations
The number of workplace discrimination and wrongful termination claims is expected to increase in 2025, with the EEOC already reporting an upward trend in case filings. Employers should document all disciplinary actions thoroughly and ensure terminations are backed by legitimate, well-documented reasons to mitigate legal risks.
5. Non-Compete Agreements Face Legal Uncertainty
The Federal Trade Commission’s proposed ban on non-compete agreements continues to face legal challenges. Courts remain divided on their enforceability, making it crucial for employers to review and revise these agreements to ensure they meet current legal standards and are not overly restrictive.
6. Employee Privacy and Data Security
As more employees leave companies to start competing businesses, trade secret misappropriation cases are increasing. Employers should enforce strict policies regarding company-issued devices and implement security measures to monitor unauthorized data transfers. Ensuring employees have no expectation of privacy on company systems is essential.
7. Cybersecurity Threats and Data Breach Liability
Cybersecurity breaches affecting employee and customer data are becoming more frequent, leading to increased legal liability. Employers should implement strong security protocols, conduct regular training and maintain compliance with data protection regulations to prevent potential class-action lawsuits.
8. Compliance with New Worker Transparency Laws
Starting mid-2025, New Jersey’s new wage transparency law will require employers to disclose salary ranges and notify employees of promotional opportunities. While private lawsuits are not explicitly permitted under this law, regulatory enforcement will be aggressive. Employers should revise job descriptions and postings accordingly.
9. Navigating Cannabis Use and Workplace Safety
New Jersey law prevents employers from taking adverse action against employees solely for testing positive for cannabis. However, businesses are still responsible for ensuring a safe workplace. Employers should train supervisors to recognize impairment and document reasonable suspicion observations to comply with state law.
10. Age and Gender Discrimination Claims Continue to Rise
With an aging workforce and continued focus on workplace harassment, employers should expect an increase in age and sex discrimination claims. Implementing clear anti-discrimination policies and conducting regular workplace training can help prevent costly litigation.
Action Steps for Employers
To mitigate risks and stay ahead of employment law changes, business owners should:
• Regularly update employee handbooks and workplace policies.
• Conduct training sessions for managers on compliance and employee rights.
• Maintain detailed records of all employment decisions.
• Consult with legal counsel to review contracts, agreements and compliance measures.
2025 presents new legal challenges, but proactive planning can help employers navigate these complexities effectively. Staying informed and prepared will ensure a smooth year ahead.
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Steven I. Adler is a partner with Mandelbaum Barrett in Roseland, NJ. He chairs the firm’s labor and employment law department and is co-chair of the litigation department. Contact him at sadler@mblawfirm.com.
Want more? Check out the March 2025 issue of New Jersey Automotive!