Spring Into May: Key Compliance Updates for Employers
News May 14, 2026
IRS Final Rule on “No Tax on Tips” Deduction
On May 1, 2026, a federal judge temporarily blocked the planned termination of Temporary Protected Status (TPS) for Yemen. As a result, certain Employment Authorization Documents (EADs) issued under Yemen TPS have been automatically extended by court order.
For employers, this means affected employees with Yemen TPS may continue working if their EAD originally expired on March 3, 2026, September 3, 2024, or March 3, 2023. USCIS has also issued updated Form I-9 guidance. When completing Form I-9, employees should enter “as per court order” in Section 1, while employers should enter “July 1, 2026” in Section 2 and include a note in the additional information box. Employers should continue monitoring USCIS for further updates and ensure I-9 records are updated appropriately.
For regular updates, check the USCIS TPS Yemen page.
On March 26, 2026, President Trump signed Executive Order 14398, requiring federal agencies to include new restrictions related to certain DEI activities in federal contracts and subcontracts. The order also increases enforcement risk, including potential contract termination, suspension, and False Claims Act (FCA) investigations for noncompliance.
Federal contractors should review DEI-related hiring, training, and workplace programs with legal counsel and monitor for additional agency guidance and enforcement activity.
Read the full article from Greenberg Traurig and the National Law Review.
The U.S. Department of Labor (DOL) has proposed a new rule that would establish a nationwide standard for when two or more businesses may be considered “joint employers” under federal labor laws. The proposal is especially relevant for manufacturers and employers that use staffing agencies, subcontractors, vendors, or other third-party labor arrangements.
The proposed rule looks at how much control a business has over workers, including hiring decisions, scheduling, supervision, pay practices, and employment records. Employers that rely on third-party labor may want to review current contracts and day-to-day management practices to better understand potential compliance risks if the rule is finalized.
Read the full article from Baker Donelson on JD Supra.
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