The following federal law changes take effect on January 1, 2025, unless otherwise noted.
IRS MILEAGE REIMBURSEMENT RATE
The IRS standard mileage rate will be 70 cents per mile driven for business purposes (up from 67 cents in 2024). This rate also applies to electric and hybrid vehicles.
Use of this rate is optional, though it’s widely accepted as an easy and standard reimbursement rate for employees who use their personal vehicle for work. If your organization uses the IRS rate to calculate mileage reimbursement, be sure to update your systems to account for this change.
EAD AUTOMATIC EXTENSION PERIOD LENGTHENED
Since 2022, the Department of Homeland Security has had temporary rules in place that extended the automatic extension period for employment authorization and Employment Authorization Documents (EADs) from 180 days to 540 days (due to processing backlogs). A permanent final rule making this 540-day extension standard will take effect January 13, 2025.
The final rule will apply to certain renewal EAD applications pending or filed on or after May 4, 2022. You can learn more about EAD extensions here.
FEDERAL CONTRACTOR MINIMUM WAGE INCREASES
The minimum wage for work performed on or in connection with federal contracts will increase as follows:
Contracts Covered by Executive Order 13658
The minimum wage will increase to $13.30 per hour, and the minimum base wage for tipped employees will increase to $9.30 per hour.
Contracts Covered by Executive Order 14026
The minimum wage will increase to $17.75 per hour for both tipped and non-tipped employees.
The Department of Labor has published helpful FAQs on Executive Order 13658 and Executive Order 14026. A side-by-side comparison of these executive orders, including the contracts covered by each, can be found here.
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