IRS – ELECTRONIC PAYMENTS MIGRATION
The IRS has begun transitioning to electronic payments for all federal disbursements and collections as mandated by Executive Order 14247, Modernizing Payments To and From America’s Bank Account. While employers can still have refunds applied to future returns, the IRS will no longer send paper checks and will be issuing tax refunds exclusively by direct deposit moving forward. This change is intended to reduce check fraud, lower costs, and speed up the delivery of payments. Employers and individuals must also use electronic funds transfer to pay any balance due, utilizing options such as the Electronic Federal Tax Payment System (EFTPS), IRS Direct Pay, or a business tax account.
Taxpayers will continue to file their returns as usual but should be prepared to provide valid bank account information to receive refunds electronically. For those without traditional banking access, Treasury-sponsored alternatives will be made available to ensure everyone can receive payments securely and reliably. These updates are designed to make receiving and making payments with the IRS faster, safer, and more efficient.
NEW JERSEY – FAMILY LEAVE ACT EXPANSIONS
Employee coverage and eligibility for the New Jersey Family Leave Act (NJFLA) has been expanded through Assembly Bill 3451. The bill gradually lowers the employee count threshold for NJFLA coverage. Currently, only employers with 30 or more employees are required to comply, providing 12 weeks of job-protected, unpaid leave and adherence to notice and resistance requirements.
On July 17, 2026, the employee count threshold will be lowered to 15 or more and subsequently lowered to 10 or more the following year, 2027. By July 2028, all employers with an employee count of five (5) or more will be required to comply.
Furthermore, the act expands eligibility, offering job-protected leave after only three months of employment and 250 minimum base hours to qualify for benefits.
US DEPARTMENT OF LABOR – INDEPENDENT CONTRACTOR RULE PROPOSAL
Late last week, the US Department of Labor’s Wage and Hour Division announced a new proposed rule that would change when and how individuals may be classified as independent contractors under the Fair Labor Standards Act (FLSA). The proposed rule would rescind the department’s 2024 Biden-era final rule regarding independent contractor classification and replace it with an analysis similar to the approach used in 2021 during President Trump’s first term.
For employers, a key difference is the adoption of a streamlined “economic reality” test, which focuses on two core factors:
- The nature and degree of control over the work.
- The worker’s opportunity for profit or loss based on initiative and investment.
Additional considerations include the skill required for the job, the permanence of the working relationship, and how integral the work is to the business’s production process.
The proposed rule would also extend the streamlined analysis to the Family and Medical Leave Act (FMLA) and Migrant and Seasonal Agricultural Worker Protection Act, both of which utilize the FLSA’s definition of “employ.”
The intent is to offer clear, predictable guidelines for classifying workers, reducing the risk of misclassification and potential litigation. All interested parties may submit comments on the proposed rule until April 28, 2026.
