Top 5 Employment Policies to Review in 2026

More than at any point in recent history, 2025 brought major changes to both federal and state employment laws and how they are applied. The current administration has undertaken many initiatives designed to reverse the trajectory of a wide range of legal requirements, including affirmative action, DEI initiatives, workforce protections for transgender individuals, and a new focus on reverse discrimination.

In addition, more and more states are enacting new legal requirements to fill gaps in federal legislation and enforcement, such as mandatory paid leave, pay transparency, and the use of artificial intelligence in the workplace.

Busy HR professionals may understandably find it hard to keep up. Prioritizing annual reviews and updates to your employee handbook is one cost-effective way to reduce risk. With that in mind, here are five employment policies for employers to consider updating in 2026.

1. Reverse discrimination

For sixty years, Title VII of the Civil Rights Act has prohibited employers from discriminating against individuals on the basis of their race, color, religion, sex, or national origin. Subsequent laws expanded the list of protected characteristics to include disability, pregnancy, and age, among others.

Historically, litigation and enforcement of federal anti-discrimination laws have primarily involved discrimination against members of a minority group (i.e., a racial or religious minority, women, disabled individuals, etc.). Through a variety of executive orders, regulatory changes, and lawsuits, the administration has started shifting focus to allegations of reverse discrimination.

For example, the Department of Justice just sued the state of Minnesota over its affirmative action requirements for state agencies, claiming that those requirements discriminate against non-minorities. This follows a unanimous 2025 U.S. Supreme Court case that eliminated a heightened standard of proof for reverse discrimination claims. Now, all employment discrimination claims are subject to the same evidentiary standard, regardless of the employee’s majority or minority status.

While discrimination and harassment policies are typically neutral enough to withstand a claim of reverse discrimination, we recommend you review yours and your employment processes with an attorney. For example, you may want to:

• Specifically refer to reverse discrimination in your discrimination and harassment policies;
• If you have an affirmative action program, determine whether it is still legally mandated and, if not, whether you should modify or eliminate it entirely; and
• If you have a DEI policy, assess the level of risk it might present under the current administration’s standards and consider policy changes designed to reduce that risk.

2. Religious discrimination and accommodations

In addition to prohibiting religious discrimination in the workplace, Title VII requires employers to accommodate an employee’s (or job applicant’s) sincerely held religious beliefs unless doing so would cause undue hardship. In this context, a reasonable accommodation includes making exceptions to your facially neutral policies to allow an employee to practice their religion.

The Equal Employment Opportunity Commission (EEOC) recently issued a press release indicating that the agency was increasing its focus on complaints of religious discrimination in the workplace, including the failure to accommodate religious beliefs.

Many employee handbooks fail to specifically address religious accommodations. Review your employment policies with the following considerations in mind:

• Specifically prohibit both discrimination and harassment on the basis of religion.
• Include a comprehensive policy regarding the potential availability of religious accommodations.
• Note that all accommodations will be made on a case-by-case basis and that retaliation for requesting or needing religious accommodation is prohibited.
• Review other policies to make sure they are neutral on the topic of religion. For example, dress code and grooming policies may disproportionately affect individuals of a particular religion or enforce stereotypes about certain groups.
• Comply with any state law(s) that may differ from federal law on the topics of religious accommodations and undue hardship standards.

3. Leave requirements

An expanding number of states and local governments require private employers to provide some form of paid or unpaid leave in a variety of circumstances. While these requirements are structured differently from one state to the next, they tend to fall into three categories:

1. Unpaid leave laws, which typically apply FMLA-like requirements to more employers;
2. Paid sick leave laws (PSL), which require employers to provide a designated amount of paid sick leave/PTO to employees;
3. Paid family and medical leave laws (PFML), which establish an employer-funded system for employees to claim leave benefits from the state.

In addition, many cities and counties impose their own paid leave requirements, even in states that already require paid leave.

Unfortunately, there is no uniformity between the paid leave laws in the different states and localities that have them. Each one has its own unique rules on coverage, eligibility, and accrual of leave. Compliance with them all is confusing at best. 

To keep employment policies current and compliant, key actions for employers to take include:

• Reviewing policies to ensure they align with the latest state and local laws;
• Tracking any changes that may need to be made in your payroll system;
• Clearly outlining eligibility and procedures for requesting paid leave, either from your organization or from the state;
• When federal, state, and/or local laws conflict, apply the one that is most favorable to the employee;
• If you have employees in multiple states, consider using a leave management vendor.

4. Pay transparency

Many states are enacting laws designed to promote wage transparency and increase employee access to salary data. The ultimate goal of these requirements is to promote equal pay. While these requirements vary from state to state, they often mandate employers to include salary ranges in job postings or disclose salary information to current employees and applicants. Some laws mandate providing pay ranges only upon request, while others require more comprehensive disclosures of remuneration and benefits.

To ensure compliance, employers may need to:

• Familiarize themselves with their legal obligations in all states where they have employees;
• Adjust job postings to include relevant salary ranges (to the extent required);
• Publish pay scales, provide training on compensation matters, and update employment policies to comply with evolving statutory standards;
• Consider eliminating any outdated policy that prohibits employees from disclosing their compensation to other employees.

5. Artificial intelligence

While AI presents organizations with many opportunities for growth and innovation, employers should also be aware of its risks and limitations. In particular, the use of AI in the hiring process can lead to both intentional and unintentional workplace discrimination, which can result in costly lawsuits or investigations.

Despite these risks, existing laws have not kept up with technological advances. While some states and local governments have taken a stab at regulating AI, that has only led to a lack of uniformity, similar to what employers face in complying with states’ paid leave requirements. A recent executive order from the White House attempts to forestall that situation by discouraging states from passing AI initiatives and pushing a federal legislative solution.

While awaiting such federal legislation, the legal landscape surrounding the use of AI, particularly in hiring, is extremely unsettled. Proper employment policies are essential to managing risks. Employers should:

• Keep informed about current state and local laws regarding AI;
• Properly vet any AI-based hiring platforms to make sure they don’t inadvertently discriminate illegally (or otherwise eliminate qualified job applicants);
• Develop appropriate policies and processes to manage the risk and avoid the legal pitfalls of AI.

Final thoughts

Each of these expanding employment policies plays a vital role in fostering a workplace that values compliance, respect, and fairness. Through regularly reviewing and updating policies, employers will be able to adapt to evolving regulations and workplace dynamics while demonstrating their commitment to employees’ well-being and rights.

This blog is provided for general informational purposes only and does not constitute legal advice. Readers should consult with a qualified legal professional for advice regarding their specific circumstances or concerns

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