Stay Compliant: Compliance Updates from March 2025

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State and Local Employment Tax and Compliance Updates

• Fremont, California Increases Minimum Wage Effective July 1, 2025: Fremont minimum wage will increase from $17.30 to $17.80 per hour with the goal of easing inflation pressures on employees.
• Idaho lowers personal income tax rate to 5.30% retroactively to January 1st, 2025: Governor Little signed House Bill 40 into effect, lowering Idaho’s income tax rate from 5.695% to 5.30%. This is the largest income tax cut in state history.
• Nebraska Redefines Gig Workers As Contractors: Nebraska enacted Legislative Bill 229, which now classifies workers using ‘marketplace network platforms such as websites or apps’ as independent contractors as long as certain conditions are met. The Bill specifically calls out apps such as Uber, Lyft, and DoorDash as workers who will be classified as contractors under the new bill.
• Ohio Passes Pay Stub Protection Act: Governor Mike DeWine signed House Bill 106 into effect that requires all Ohio employers to provide detailed statements of earnings and deductions to their employees for each pay period. Paystubs for Ohio employees must now include the employee's name and address, gross wages, itemized deductions from an employee’s gross pay, the pay period covered, and the pay date.

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DoorDash Settlements Pay Dispute for $16.75M With New York Attorney General’s Office

DoorDash was accused of using consumer tips to subsidize guaranteed pay for its workers. This goes against DoorDash’s stated guarantee that all tips go directly to the worker. DoorDash settled the lawsuit for $16,750,000 with the New York Attorney General Office. 

This settlement is a significant development in labor and payroll compliance, particularly in the gig economy. It highlights the importance of transparency in wage structures and tipping practices. The case underscores regulatory scrutiny over how companies handle compensation for workers.

For employers, this case serves as a reminder to ensure that compensation structures align with legal and ethical standards. Employers—especially those relying on tipping models—should review their payroll policies to avoid similar legal challenges.

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