The Department of Labor (DOL) has issued its semi-annual regulatory agenda detailing planned action on several rules that would impact employers. The Federal Trade Commission has taken several actions concerning noncompete agreements. Two surveys indicate that health care costs are going to rise in 2026 by the largest amount in a number of years. DOL has updated its employer resources that can assist in complying with wage and hour laws.

DOL Issues Regulatory Agenda – The Department of Labor issued its semi-annual regulatory agenda setting forth regulatory action that it intends to take.  Deputy Secretary of Labor Keith Sonderling stated, “This regulatory agenda reflects our steadfast commitment to restoring economic opportunity by fostering innovation and reducing unnecessary burdens on employers.”

Among the regulations included in the agenda are:

• Employee or Independent Contractor Classification under the FLSA – DOL plans to examine when a worker should be classified as either an employee or independent contractor under the Fair Labor Standards Act (FLSA).  Proposed regulations may be issued this month.
• Joint Employer Status – DOL may issue proposed regulations in December addressing when employers can be considered joint employers under the FLSA.
• Defining Exemptions for Executive, Administrative and Professional Employees – DOL plans to determine when salaried employees are exempt from the FLSA overtime requirements. No date has been set for when a proposed rule might be issued.
• Prudence and Loyalty in Selecting Retirement Plan Investments – DOL will decide the extent to which fiduciaries can prioritize environmental, social, and governance factors (ESG) when making investment choices. DOL plans to release a rule in May 2026.

• Heat Injury and Illness Prevention in Outdoor and Indoor Work Settings – DOL plans to continue to look at how to establish standards concerning heat-related injury and illness prevention in both indoor and outdoor work settings. No date is provided for additional action on this issue.
  

FTC Takes Actions on Noncompete Agreements – The Federal Trade Commission (FTC) voted to drop its appeal of two cases that challenged the noncompete ban issued during the Biden Administration. The cases were Ryan, LLC v. FTC on appeal to the Fifth Circuit Court of Appeals and Properties of the Villages v. FTC on appeal to the Eleventh Circuit Court of Appeals.

In calling the previous rule’s illegality “patently obvious”, FTC chairman Andrew Ferguson stated, that the FTC is choosing “to protect American workers by doing what Congress told us to do—patrolling our markets for specific anticompetitive conduct that hurts American consumers and workers, and taking bad actors to court.” He noted that he will be sending warning letters to employers in industries that have a large number of noncompete agreements, “urging them to consider abandoning those agreements as the Commission prepares investigations and enforcement actions.”

Subsequently, FTC chairman Andrew Ferguson sent letters to healthcare employers and staffing companies expressing concern that noncompete agreements in employment contracts may “unreasonably limit employment options for vital roles like nurses, physicians, and other medical professionals.” He noted that the FTC has statutory authority to investigate noncompete agreements that are “unjustified, overbroad, or otherwise unfair or anticompetitive.” While emphasizing that the letter does not suggest illegal conduct, he urged a comprehensive review of employment agreements including noncompete or restrictive covenants to “ensure that they comply with applicable laws and are appropriately tailored to the circumstances.”

The FTC has also filed a complaint against Gateway US Holdings, Inc., a pet cremation company, over its use of noncompete agreements. According to the complaint, Gateway is accused of requiring noncompete agreements for almost 1,800 employees that require for one year following the conclusion of employment with the company, they are prohibited from working in the pet cremation service industry anywhere in the United States. The FTC stated that the noncompete agreements are required without any individual consideration of the roles of employees. The FTC believes that Gateway’s conduct constitutes an unfair method of competition in violation of the Federal Trade Commission Act.

Health Insurance Costs Expected to Increase in 2026 – Two recent surveys by Mercer and Segal  predict large increases in health insurance costs in 2026. Survey respondents expect health insurance costs will rise by the largest amount in a number of years. The Mercer survey found that health benefit costs per employee are predicted to rise by 6.5% on average, while the Segal survey expected an even larger increase of 9% for medical benefits.   

The Mercer survey found that this will be the fourth consecutive year of elevated health care cost increases after a decade of more modest increases. According to Sunit Patel, Mercer’s US Chief Actuary for Health and Benefits, “Health benefit cost trend has two primary components –healthcare price and utilization. Right now, both are rising.” To address the health insurance cost increases, 59% of employers plan to make cost-cutting changes such as raising deductibles and other cost-sharing provisions, which can lead to higher out-of-pocket costs for plan participants.

Segal found that prescription drugs are expected to increase by 11%, with anti-obesity medications being the top reason for the projected increase. Segal identified increased utilization of mental health services as the largest contributor to healthcare costs. Eileen Flick, Leader of Healthcare Informatics and Segal Senior vice president stated that “The cost of healthcare is reaching its breaking point.”

DOL Updates Compliance Assistance  - The Department of Labor updated the online employer resources designed to help employers comply with wage and hour laws. The resources include forms, fact sheets, frequently asked questions, compliance toolkits, training videos, and workplace posters.

Neil Reichenberg is the former executive director of the International Public Management Association for Human Resources. He is an attorney, a frequent writer and speaker on public policy and human resource issues, and an adjunct faculty member at George Mason University. For questions or additional information, contact Reichenberg at [email protected].