May 2025 Checklist: Key Compliance Updates for Employers

As we move further into 2025, employers face a number of compliance deadlines and policy shifts that require timely attention. Building on our April checklist, this month’s update highlights six key developments—some newly in effect, others still unfolding—that call for action or close monitoring. From EEO-1 reporting and shifts in federal enforcement to expanded state sick leave laws and midyear policy reviews, this roundup outlines the legal updates employers should prepare for in May.

Prepare for EEO-1 Reporting

The Equal Employment Opportunity Commission (EEOC) is expected to begin collecting 2024 EEO-1 Component 1 data on May 20, 2025, with a tentative submission deadline of June 24, 2025. While these dates have not yet been officially confirmed by the EEOC, they reflect the agency’s filing timeline proposed to the White House Office of Management and Budget. Employers should continue monitoring the EEOC website for final confirmation.

The EEO-1 report is mandatory for:

• Private employers with 100 or more employees, and

• Federal contractors with 50 or more employees and a qualifying federal contract.

  
  

Employers should begin reviewing workforce data now to ensure accuracy across job category, race/ethnicity, and sex classifications. The 2024 form is expected to exclude a non-binary option, which may require internal annotation or separate tracking. Reviewing prior submissions can also help identify discrepancies or structural adjustments that may be needed.

Monitor Federal Shift on Discrimination Standards

On April 23, the President signed an executive order telling federal agencies to limit their use of a legal concept called disparate impact liability. This standard allows people to challenge workplace policies that seem neutral but result in negative outcomes for certain protected groups—such as women or people of color.

Although this move may reduce some types of federal enforcement, it does not change existing anti-discrimination laws, including Title VII, the Americans with Disabilities Act (ADA), or various state-level laws, all of which still recognize disparate impact claims.

Employers should not treat this shift as a reason to relax compliance. Workplace policies—especially those involving hiring, promotions, and discipline—should be regularly reviewed for fairness and consistency. If a policy appears to affect one group more than others, employers must be ready to show a legitimate, business-related reason for using it.

Reassess Immigration Options Following H-1B Lottery

With the FY 2026 H-1B cap lottery now complete, employers whose candidates were not selected should explore alternative visa options. Depending on the employee’s qualifications and circumstances, potential alternatives include:

• L-1 visas for intracompany transferees,

• O-1 visas for individuals with extraordinary ability, and

• TN visas for eligible Canadian and Mexican professionals.

  
  

Each path has unique eligibility criteria, documentation needs, and timing considerations. Employers should consult immigration counsel early to identify viable options, avoid employment interruptions, and meet critical filing deadlines.

Update State Paid Sick Leave Policies

Missouri’s new statewide paid sick leave law took effect on May 1, 2025, adding to the growing list of jurisdictions with standalone leave mandates. Employers must comply with specific accrual, usage, carryover, and notice requirements. Written notice was due to existing employees by April 15, and must be provided to new hires within 14 days. A workplace poster outlining employee rights must also be displayed.

Later this year, Alaska (effective July 1) and Nebraska (effective October 1) will implement similar laws. Additionally, Connecticut and Michigan have expanded their paid sick leave statutes, broadening both employer coverage and employee eligibility.

Employers with multi-state operations should ensure that leave policies meet each state’s requirements. A uniform PTO policy may no longer satisfy compliance standards in every jurisdiction. For a comprehensive overview, see our full article: Paid Sick Leave Expands in 2025: What Employers Need to Know

Conduct Midyear Policy and Contract Reviews

With several employment law changes already in effect or scheduled for midyear, May is an ideal time to review and update employee handbooks and employment agreement templates. Areas to consider include:

• State-specific paid sick leave compliance,

• ADA accommodation procedures,

• Pay transparency in job postings and internal practices, and

• Restrictive covenants in light of evolving noncompete legislation.

  
  

Employers operating in multiple states should confirm their documents align with the legal standards of each jurisdiction. A midyear review can help maintain consistency, reduce legal exposure, and ensure that HR practices remain compliant as the regulatory landscape continues to shift.

How ILS Can Help

At Innovative Legal Services (ILS), we support employers in staying compliant amid evolving legal requirements. If you need help reviewing or updating your policies, please contact us at contact@consultils.com.

Disclaimer: The materials provided on this website are for general informational purposes only and do not, and are not intended to, constitute legal advice. You should not act or refrain from acting based on any information provided here. Please consult with your own legal counsel regarding your specific situation and legal questions.