From recruiting and retention to company culture and the latest in HR tech, HR Brew delivers up-to-date industry news and tips to help HR pros stay nimble in today’s fast-changing business environment.

HR Brew

Sam Blum

hr-brew.com

Business people in suits signing contracts. 

Joe Biden's FTC wants to ban non-compete clauses 

Under the Biden administration, the FTC is dipping its toes into federal labor rules. 

The FTC wants to ban non-compete clauses, allowing roughly 30 million workers to make more money

A Starbucks cup is stuffed full of union voting ballots.

We spoke to a labor lawyer about the legal protections employees have when organizing.

High-profile union campaigns offer a learning opportunity for HR

Picket signs that read "Fed up" "Pay us more" "Higher wages now"  "forced overtime"

New research from Harvard Business School may help employers keep workers. 

The key to retaining low wage workers? Opportunity for growth, survey says

Employee working at his laptop with manager over shoulder

Labor

An illustration of reporter Courtney Vinopal's headshot.

Courtney Vinopal

When fast-food workers began walking off the job to demand a $15-an-hour minimum wage in 2012, McDonald’s was at the center of the fight. The fast-food chain resisted workers demanding higher pay for a number of years, though ultimately capitulated, saying it 

 policies to increase the minimum wage at the state or local level.

Given the chain’s previous opposition, it was somewhat surprising to see McDonald’s recently call on its restaurant-industry colleagues to pay their workers 

McDonald’s opposes low wages for restaurant workers. 

In early September, McDonald’s CEO Chris Kempczinski 

 against the tipped minimum wage, which allows establishments like restaurants and bars to pay their tipped workers as little as $2.13 an hour, as long as they earn the federal minimum of $7.25 when tips are included. This practice creates “an uneven playing field,” Kempczinski told CNBC.

The issue even led McDonald’s to pull out of the National Restaurant Association, the lobbying organization that opposes movements like Fight for $15.

McDonald’s, of course, has a dog in the fight, as it’s not able to take advantage of the tipped minimum wage. Meanwhile, competitors like Chili’s are able to save labor costs by paying their workers below the federal minimum, and in turn offer prices on par with McDonald’s, the Wall Street Journal 

How tipped wage policies are affecting HR. 

McDonald’s is the biggest fast-food chain to put its thumb on the scale with regards to the tipped minimum wage, but the debate has already prompted policy changes at the state and federal level—with implications for HR teams.

Both Democrats and Republicans embraced proposals to end taxes on tips during the 2024 presidential campaign, and a version of this policy ended up in the Republican tax bill that was 

. Starting next year, workers in certain jobs can deduct up to $25,000 from their tipped income each tax year. It’s unclear how widespread an effect the policy will have on tipped workers, as many don’t earn enough income to pay federal taxes, but it’s 

reporting requirements for employers (a draft version of a W-2 form for 2026 includes sections for businesses to report “qualified tips” and a code for a worker’s “tipped occupation”).

The “no tax on tips” proposal was a “red herring” to cater to low-wage workers, said Saru Jayaraman, president of the advocacy organization One Fair Wage. Nevertheless, “it at least elevated the question of, what are we going to do for this massive workforce that is the lowest paid workforce in America and is living on tips?” she said.

Several jurisdictions—including California, Washington state, Chicago, and DC—have already enacted laws to phase out the tipped minimum wage. Jayaraman expressed optimism that McDonald’s could spur more companies to speak out about paying workers a full minimum wage.

When asked about how paying a full minimum wage has impacted businesses, Jayaraman pointed to Denny’s. In 2021 its CFO admitted on 

 that raising the minimum wage to $15 an hour in California had been good for the chain’s bottom line.

Another factor HR teams may have to consider when looking to raise tipped workers’ wages is just 

 the practice of tipping has become in US establishments.

“I don’t see us getting away from a tipping culture. It seems to be continuing to build,” said Erica Brune, CEO and co-founder of Lever1, an HR outsourcing firm based in St. Louis. Brune said she hasn’t seen many of Lever1’s clients in the hospitality industry move to raise base pay and phase out tipping, but rather focus on how to offer a competitive salary when taking both hourly pay and tips into account.

She noted that when employers do decide to raise wages, it’s hard to walk back that decision.

“When you change a wage base, you can’t step it back,” she said.

McDonald’s puts its thumb on the scale regarding the minimum wage

McDonald’s recently came out against the tipped minimum wage, which allows competitors to cut into its profits. 

The call to end the tipped minimum wage is growing louder. Here’s what that means for HR.

An illustration of a photo of HR Brew reporter Paige McGlauflin.

Paige McGlauflin

There’s good news and bad news for anyone who felt like things were not as they appeared to be with the labor market.

The good news: You weren’t crazy. And the bad news: The labor market was performing 

 worse than initially reported by the Bureau of Labor Statistics (BLS).

Employers added 911,000 fewer jobs between April 2024 and March 2025 than previously reported, according to a 

The preliminary benchmark, accounting for around 76,000 fewer jobs a month on average, is the largest downward revision since 2002. By comparison, 

 downsized job growth by 818,000 (though it was later adjusted to 598,000), and a revision in March 2009 downsized growth by 902,000.

Despite being released in September 2025, the benchmark is unrelated to the latest employment situation data from the BLS, which found that employers added 

“The latest economic data—which are wholly unaffected by today’s preliminary revisions—suggest the labor market is weakening for all workers,” Elise Gould and Ben Zipperer, senior economists at the Economic Policy Institute, 

 via the nonprofit. “Job growth has been especially weak since May. Household survey rates also point to falling prime-age Black employment and higher unemployment for US-born workers.”

Leisure and hospitality saw the steepest downward revision of all major industries, adding 176,000 fewer jobs than originally reported. That was followed by professional and business services and retail trade, which saw declines of 158,000 and 126,200, respectively.

However, transportation and warehousing and utilities both had more job growth than initially reported, adding 6,600 and 3,700, respectively.

Each year, the BLS adjusts its employment numbers for a specific period, originally taken from its monthly establishment survey, using estimates from state unemployment insurance tax records as its benchmark. These records are less timely, but more comprehensive than the BLS’s survey, which has in recent years 

 to get robust response rates. The BLS is expected to release its full revision early next year.

One reason for the discrepancies between the monthly survey data and revisions may be how immigration is factored into each report, Ron Hetrick, principal economist at Lightcast, 

. State unemployment insurance records only include workers who are eligible for unemployment, not undocumented workers who are on employers’ payrolls and pay taxes but ineligible for unemployment benefits. Meanwhile, the monthly survey data does not ask about immigration status. And, as the Trump administration began revoking the legal statuses of thousands of immigrants, they were removed from payroll counts.

“There were more people working on payrolls and that is what the survey is measuring. Now they aren’t,” Hetrick wrote. “These people drove growth and were initially counted, and now they are leaving payrolls.”

 Tuesday’s revisions come as the Trump administration has 

 to the agency’s data and practices. President Trump’s nominee to lead the BLS has advocated for releasing the jobs report on a quarterly basis to ensure what he claimed is greater accuracy. But economists reacting to Tuesday’s benchmark data noted that despite its flaws, it’s better to take the monthly report for important talent-related decision making than have to wait months to get that data.

“If I had to choose between less accurate information today to guide a decision, versus more accurate data four months from now—after the decision is made—I’d always choose the former,” Kory Kantenga, head of economics for the Americas at LinkedIn, 

An illustration of a businessman slipping down a downward trending line graph.

Employers added 910 fewer jobs than initially estimated, per BLS revision

Tuesday’s preliminary benchmark from the BLS marks the largest downward revision of employment data in recent history.

Employers added 910,000 fewer jobs than the BLS originally estimated

The Bureau of Labor Statistics’ August 

 was, well, not good. Employers made few job gains, while the unemployment rate rose to its highest level in years. As the labor market slowed further this summer, experts have again sounded the alarm about an economic downturn. Let’s take a closer look.

Employers added just 22,000 jobs in August, well below 

 of 75,000. Meanwhile, June job gains were revised down by 13,000, and July job gains were revised up to 79,000. The unemployment rate increased to 4.3%, the highest seen since October 2021.

 that a recession may be imminent, while Mark Zandi, an economist at Moody’s, 

 that the labor market is already in one, and has been since June, Business Insider reported. While one month of data is not enough evidence of a recession, the unemployment rate rising while job gains are slowing is a concerning early sign, said Glassdoor’s chief economist, Daniel Zhao, noting if this trend continues in the coming months, it could trigger the Sahm rule (a recession indicator).

“A more substantial downturn is definitely something that businesses have to plan for,” Zhao said. “It’s not a guarantee, but especially with the increasing unemployment rate there are more signs that the job market is weakening in an unhealthy manner.”

Amy Glaser, SVP of business operations at staffing firm Adecco, cautioned employers against letting the topline August numbers drive their talent decision-making.

“We’ll have to wait and see what comes out in September. At this point, I’m still optimistic the labor market is going to remain resilient and strong,” she said. “We’ve called 2025 the year of durability in terms of the labor market. Unemployment changed very minimally, so there’s still opportunity out there for millions of Americans on a daily basis.”

Healthcare added around 31,000 jobs in August, the largest increase of any industry but also below the average monthly gains of 42,000 that the sector reported over the last year. The healthcare industry has made up the bulk of the labor market’s job gains in recent years, and now a moderation in healthcare hiring may not adequately make up for cooling in other sectors.

“There’s no guarantee that healthcare will continue to add jobs at the pace that we’ve seen in recent years. So even if healthcare is continuing to add jobs in the short to medium term, it might not be enough to outweigh the declines in jobs that we’re seeing across all other industries,” Zhao said.

Healthcare was followed by social assistance, which added more than 16,000 jobs, and accommodation and food services, which added over 13,000 jobs. Additionally, retail trade added 10,000 jobs, mostly driven by general merchandising.

Meanwhile, professional and business services reported a decline, with 17,000 fewer jobs added—the steepest of any industry. That sector was followed by durable goods manufacturing and the federal government, which added 19,000 and 15,000 fewer jobs, respectively.

Unfortunately for employers, it’s uncertain how the economy will play out over the next few months. The Federal Reserve is expected to meet and cut interest rates later this month. Lower interest rates could free up cash for businesses and allow them to pursue business investments that lead to hiring.

“Overall, I would say that rate cuts will be stimulative, but it’s not a guarantee that it will outweigh some of these other factors that aren’t related to rates at all,” Zhao said.

The other primary factor at play is tariffs. Despite being locked up in court challenges, many of President Donald Trump’s 

 went into effect in August, charging a 10% to 50% tax on imported goods, depending on the origin country. The impact of tariffs on consumers and businesses isn’t yet known, though sectors like retail and leisure and hospitality—both of which reported employment gains in August—will likely be negatively affected, according to Zhao.

In light of this uncertainty, Glaser said employers are focused on making multiple contingency plans.

“I think if Covid taught us anything as employers, it taught us the ability to be agile and to move quickly,” she said. “So employers are trying to get ahead of it, as we speak today.”

Weak August jobs data is bad news for employers

“A more substantial downturn is definitely something that businesses have to plan for,” an economist tells HR Brew.

Abysmal August jobs report puts recession fears back on employers’ radar

Following major shakeups at the Bureau of Labor Statistics (BLS), September’s labor market data has many on their toes.

President Donald Trump fired BLS commissioner Erika McEntarfar on Aug. 1, following a 

 that estimated employers added only 73,000 jobs in July and revised job growth down by 258,000 in May and June.

“She will be replaced with someone much more competent and qualified. Important numbers like this must be fair and accurate, they can’t be manipulated for political purposes,” Trump 

 on his social media platform. There has been zero evidence of “rigged” data on her part.

McEntarfar’s removal raised concerns among experts including former BLS commissioners (appointed by both Democratic and Republic presidents), who warned it could 

 Then, on Aug. 11, Trump nominated a replacement: E.J. Antoni, chief economist of the Heritage Foundation, the conservative think tank that published Project 2025.

 in front of the Senate HELP Committee this month, has been met with outcry from many economists, who’ve said he is 

 to lead the BLS and fear he would use the agency and its data to 

further the Trump administration’s political agenda

, rather than report objective statistics.

The outcry sends a worrying signal to HR and talent acquisition (TA) leaders, who use BLS data for everything from forecasting changes in labor supply and demand by location to tracking wage growth by industry.

“Bipartisan groups, including former BLS officials and commissioners, economists, watchdog orgs, condemned that firing as a literal threat to statistical independence… [that] is something that will make every chief people officer, every economist, every talent acquisition leader, raise their eyebrows quite a bit,” Matt Staney, VP of community at HIGHER Community, a professional group that counts more than 12,000 senior TA leaders among its members, told HR Brew.

At the time of McEntarfar’s firing, Lauren Winans, CEO and principal HR consultant at Next Level Benefits, assumed that the BLS commissioner must have done something “really egregious” to warrant her dismissal, until she looked at the revisions.

“But then when you dig into it, the updates and the revisions that were made to the data are pretty standard, because it’s statistical data, and because things are collected in somewhat of an antiquated way, and there are delays,” she said, adding later, “I thought the rush to judgment to immediately go after the commissioner was a little shortsighted, because then it creates this crack in the stability and the credibility of the agency itself.”

. But proposals from the Trump administration and Antoni to “improve the data”—by 

 for a quarterly, for example—could impact how HR leaders craft their hiring strategies, Winans said. Additionally, after significant methodological changes, it could take months before the data is trustworthy again.

“Certainly if they make a shift in methodology, I probably would give it at least a couple of cycles before I maybe trust the data, because when you switch that methodology, that does kind of create some significant change in the way the numbers look and how long it takes to kind of catch up with itself,” Winans said, noting she would continue to use the data as one of several indicators of economic health.

However, McEntarfar’s baseless firing over an upsetting jobs report has already sowed mistrust in future data among HR and TA leaders, said Staney. Employers were planning their hiring strategies on a quarterly basis, as crises from policies like tariffs worsened economic uncertainty. As the integrity of the jobs data creates more uncertainty, TA leaders’ planning will only become more short term.

“When TA leaders pitch workforce strategy to execs, they need to be able to point to independent and trusted sources, and we’re running out of those now, if these sources become political tools,” said Staney. “If he just implants a loyalist into the BLS to just paint whatever picture he wants, we’re going to be flying completely blind, and nobody’s going to trust anything, and companies are not going to hire in a healthy way, and our unemployment situation will worsen.”

President Donald Trump stands in the oval office, with large printouts of economic graphs stacked on the Resolute desk

BLS’s leadership shakeup sends worrying signal for employers

President Trump’s firing of the BLS commissioner, and subsequent outcry from experts, is a bad sign for HR leaders who rely on the data.

Why leadership changes at the BLS are worrying for employers

The Department of Labor (DOL) is expanding a series of programs that allow employers to report and correct workplace violations to avoid formal investigations or lawsuits.

The Biden administration had discontinued one such program, which focuses on payroll violations, over concerns it violated workers’ rights and disincentivized employers from following the law. That program will now be revived, giving employers the opportunity to resolve violations under both the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA).

Why the Trump administration is encouraging self-audits. 

The DOL highlighted six agencies under its direction that are launching, continuing, or expanding self-audit programs, including the Employee Benefits Security Administration, the Occupational Safety and Health Administration (OSHA), and the Wage and Hour Division (WHD).

 issued regarding the agency’s self-audit programs, Deputy Secretary of Labor Keith Sonderling said the programs were intended to give employers the tools “to correct potential violations proactively.” The practice of self-auditing, he added, is “one of the most effective ways to build a culture of compliance and trust.”

Payroll Audit Independent Determination (PAID)

 program, which launched in 2018, allows employers to identify potential minimum wage, overtime, and leave violations. If they report violations to the WHD and correct them by paying workers back wages, for example, they may avoid formal investigations or litigation, according to the DOL.

When the Biden administration discontinued the PAID program in January 2021, Wage and Hour Division Principal Deputy Administrator Jessica Looman cited concerns that the program barred workers from suing their employers over such violations. “The Payroll Audit Independent Determination program deprived workers of their rights and put employers that play by the rules at a disadvantage,” she said 

The revived PAID program allows employers to report and correct a broader range of violations, as it applies to both the FLSA and

the FMLA (the latter wasn’t previously covered).

Only employers without a history of FLSA or FMLA violations within the last three years may participate in the program, 

. They also can’t be subject to any investigations or lawsuits alleging violations of these laws, and must inform the WHD of any complaints they’ve received from workers regarding potential violations. Businesses participating in the PAID program must pay back wages owed to their workers within 15 days after receiving a summary of unpaid wages from the DOL, and also provide proof they have done so to avoid a formal investigation or litigation.

While this program provides an opportunity for HR teams to get ahead of potential payroll or leave violations at their workplaces, it’s important to note that it doesn’t supersede state or local laws. In states where the statute of limitations for wage claims is longer—such as New York or Massachussetts—businesses could open themselves up to lawsuits by disclosing violations to the federal government, Fisher Phillips attorneys 

This marks the latest move by the DOL to ostensibly encourage compliance while easing up on penalties for employers. In June, the agency announced it 

 its opinion letter program to guide employers on compliance, and in July the DOL said it would make it easier for small businesses 

 it will no longer seek liquidated damages in settlements concerning wage or overtime violations under the FLSA.

Legislative Lowdown recurring feature illustration

Trump DOL revives self-audit program for wage violations

A program for correcting wage-and-hour violations is being revived after it was discontinued by the Biden administration. 

Legislative lowdown: Labor Department expands programs allowing employers to avoid investigations

The labor market is like those slimy pests that love eating the tomato plants growing in your garden: sluggish.

 that existing economic uncertainty and new turmoil driven by President Trump’s ongoing tariff threats could send the labor market into a tailspin. While that hasn’t occurred, the latest

 (JOLTS) data for June from the Bureau of Labor Statistics suggests that the labor market is continuing its slow but steady cooldown.

In some ways, it’s a blessing and a curse: While the job market hasn’t gone off the deep end, its continual stagnation is also creating its own problems. For example, as fewer opportunities open up externally, employees will be less likely to quit, stalling internal mobility opportunities.

“The story is not one of a job market that is collapsing. Instead, we see much like we’ve seen in the last few months, that the job market is cooling gradually,” said Daniel Zhao, Glassdoor’s lead economist. “But we are still seeing the same pattern in the JOLTS data that has helped explain why workers feel so sour about the current job market.”

Employers had 7.4 million job openings posted at the end of June, a decline of 275,000 from the previous month. Accommodation and food services saw the biggest drop in openings, declining by 308,000 to 754,000 in June. That was followed by healthcare and social assistance (declining 244,000) and finance and insurance (down 142,000).

Meanwhile, retail trade increased by 190,000 to 656,000 job openings, the highest monthly increase for the June data, followed by professional and business services increasing by 156,000, and information by 67,000.

Meanwhile, organizations made 261,000 fewer hires month over month, recording just 5.2 million hires in June. Professional and business services recorded the steepest monthly drop in hires between May and June, reporting 936,000 total hires, a decline of 133,000 month over month. That was followed by accommodation and food services (declining 106,000), and arts, entertainment, and recreation (falling 42,000).

The number of employees quitting declined by 128,000 to 3.1 million, while layoffs and discharges remained relatively unchanged at 1.6 million in June. With total separations, professional and business services declined by 56,000 to a total of 944,000 for the month. Meanwhile, retail trade recorded the highest spike in separations, increasing by 31,000 to 612,000 in June—of that total, 440,000 were employees quitting.

As speculation over whether AI is replacing white-collar jobs mounts, including in professional services and finance, 

 that the technology could be a factor in job turnover plummeting for these sectors.

 prompting cost-cutting measures, including offshoring jobs and layoffs, are what’s really driving a slowdown in these fields. While some jobs, such as administrative services, might be more susceptible to employers wanting to replace workers with AI, this interest is still being driven primarily by cost savings, Zhao said.

“I think it’s hard to see evidence that AI is specifically driving the slow down in jobs growth that we’re seeing. Instead, I suspect it’s a little bit reversed where, right now, jobs growth in general is slow, and that’s being driven by macroeconomic factors rather than AI,” Zhao added.

As economic uncertainty persists, employers will have to be prepared for the labor market to shift in any direction. That’ll mean continuing to plan for a myriad of scenarios, according to Zhao.

“Given how much uncertainty there is right now, it would be irresponsible to stick our heads in the sand and pretend that there is only one path forward.”

HR leaders will want to keep an eye on their workers as well. With fewer opportunities opening up internally and externally, workers are more and more susceptible to resentment and disengagement, Zhao claims.

“I think it’s important for HR leaders to recognize that employee disengagement is likely to be a significant problem right now, and might even be worse than in other job market contexts,” Zhao said, “because so many workers are prioritizing job security and would rather sit in place in a job where they are disengaged and unhappy rather than test the waters on the open market.”

a graphic of a cartoon man walking on a stock market chart

Why June’s sluggish labor turnover data spells trouble for employers

Employee resentment could climb as high as these heat wave temps.

June’s sluggish labor turnover data could spell trouble for employers

 a Biden-era opinion letter on July 21 that had indicated a racial equity program proposed by Citibank would be lawful.

A program to pay the investment fees for “diverse asset managers” was never implemented, according to Citi, but the DOL nevertheless cautioned the bank against carrying it out.

The DOL’s decision to rescind an advisory opinion that was favorable of the proposed program shows how the administration is scrutinizing private firms for “illegal” DEI practices.

Why the DOL targeted Citi’s DEI efforts. 

, issued by the DOL in 2023, referenced a racial equity program that was part of Citi’s broader efforts to close the racial wealth gap.

As part of the racial equity program, Citi would pay all or part of the investment management fees for “diverse managers” retained by employee benefit plans—such as defined benefit or defined contribution plans—sponsored by the bank. The opinion noted that asset managers from diverse backgrounds tend to be underrepresented in the market, even though they “perform as well or better than median performers.”

Covering fees for managers from underrepresented backgrounds, the bank asserted, would “help address such systematic disadvantages in the context of Citi’s own employee benefit plans,” a DOL official with the Biden administration wrote.

While the Biden-era DOL indicated that such a program would be legal, and offered insight on how the bank could act as a responsible fiduciary to that end, the agency now asserts “its allocation of benefits on the basis of race clearly and unambiguously violates the civil rights laws,” according to the letter issued July 21.

A separate DOL official cited a number of legal cases, including the 2023 Supreme Court ruling 

Ames v. Ohio Department of Youth Services 

allowing a reverse discrimination case to proceed, when explaining why the agency believed the Citi program was illegal.

“Citi should take immediate action to end all illegal activity within its Racial Equity Program and any other initiative, plan, program, or scheme it operates under the banner of diversity, equity, and inclusion,” the official wrote.

What this means for DEI in the private sector. 

Citi told HR Brew via email that it never implemented the hypothetical program called out by the DOL, and doesn’t have plans to do so.

Nevertheless, the July 21 letter seems to indicate what types of programs or practices the Trump administration may scrutinize as it seeks to combat “illegal” DEI in the public and private sectors. A Jan. 21 executive order 

 calls on measures to encourage private-sector employers to end “illegal DEI discrimination and preferences,” and a number of companies 

 on their DEI efforts in light of this scrutiny.

The order also directed federal agencies to “identify up to nine potential civil compliance investigations” related to DEI programs at publicly traded companies, large nonprofits, or universities, though the DOL didn’t say whether it’s investigating Citi as a result of this program.

 for rebranding their efforts to avoid legal issues in a Senate Judiciary Committee hearing last week, HR Brew recently reported. But Sen. Mazie Hirono, a Democrat, noted the Constitution “does not bar diversity, equity, and inclusion,” adding, “programming relating to diversity is not illegal just because Donald Trump says so."

Labor Department targets DEI at Citibank with opinion letter

 Citi says it never implemented a program to reward asset managers from underrepresented backgrounds, but the DOL still warned the bank to “end all illegal activity” tied to it.