Virginia's new Paid Family and Medical Leave (PFML) program creates a state-administered paid leave insurance program that provides eligible employees with partial wage replacement when they need time away from work for qualifying family or medical reasons, such as the birth or adoption of a child, caring for a family member with a serious health condition, the employee's own serious health condition, or certain military-related events.

The program will be funded through payroll contributions beginning April 1, 2028, with benefits expected to become available December 1, 2028 (or early 2029, depending on state implementation). 

Separate from PFML, Virginia also enacted a Paid Sick Leave requirement that phases in beginning July 1, 2027, requiring covered employers to provide employees with paid sick leave for routine illness, preventive care, and certain family care needs. 

The new laws establish minimum statutory leave benefits and generally do not require employers to eliminate or replace existing Paid Time Off (PTO), vacation, or sick leave policies. Employers may continue offering more generous benefits than required by state law. 

Final regulations from the Virginia Employment Commission are expected to provide additional guidance on leave coordination before the programs become effective. 

How PFML Differs from Paid Sick Leave 

For employers with Virginia employees, it is important to distinguish between the two new laws: 

1. Paid Family & Medical Leave (PFML) – a state-run insurance program funded through payroll contributions.  

   
   

• Employees may qualify for up to 12 weeks of wage replacement benefits from the state PFML insurance program.  

  
  

• Eligible employees may receive 80% of their average weekly wage  

  
  

• Employers will be responsible for payroll contributions and employee withholdings, as applicable once the state establishes contribution rates.  

  
  

• PFML is intended for longer-term qualifying family and medical leave events and operates separately from employer PTO or sick leave policies, although employers will need to coordinate these benefits with their existing leave programs.  

  
  

• Employees will apply directly to the Virginia Employment Commission (VEC) for benefits, not to their employer. The VEC will determine eligibility, approve claims, and pay benefits.  

  
  

• Employers will verify employment and wages and provide required information to the VEC.  

  
  

2. Paid Sick Leave (PSL) – an employer-provided leave benefit with minimum accrual requirements.

The U.S. Equal Employment Opportunity Commission (EEOC) has taken the first step toward eliminating the long-standing requirement for many employers to file annual workforce demographic reports, including the EEO-1 report. While this represents a significant potential change, it is only a proposed rule and is not currently in effect. 

Although this proposal has received considerable attention, no employer reporting requirements have changed at this time. The proposal must complete the federal rulemaking process, including a public comment period and issuance of a final rule, before any changes become effective.

Until then, employers should continue to comply with all current EEO-1 reporting and recordkeeping requirements, as well as any other applicable federal contractor and state reporting obligations. 

As part of our normal compliance support process, C2 Essentials prepares draft EEO-1 reports using available payroll and workforce data and provides to applicable clients for review and confirmation prior to submission.

At this time, the EEOC has not opened the 2026 EEO-1 reporting period. If the EEOC reporting cycle proceeds under the current requirements, C2 Essentials will assist with preparation of the applicable reports and will communicate next steps to impacted clients. 

What Employers Should Know 

The EEO-1 Report is an annual workforce demographic report that summarizes the number of employees by job category, race/ethnicity, and sex. The report contains aggregated workforce data rather than individual employee information and has historically been used by the EEOC to support enforcement of federal equal employment opportunity laws. 

Private-sector employers that have 100 or more employees during the selected workforce snapshot period are generally required to file an EEO-1 report. Federal contractors and first-tier subcontractors generally must file an EEO-1 report if they have 50 or more employees, and hold at least one qualifying federal contract, subcontract, or purchase order meeting the applicable monetary threshold (currently $50,000 or more). 

If finalized, the proposal would remove the federal requirement for covered employers to annually report workforce demographic information by race and sex. According to the EEOC, the proposed change is intended to reduce the administrative burden associated with annual demographic reporting and reflects the agency's current enforcement priorities.  

No Immediate Changes to Employer Equal Employment Obligations 

While the EEOC's proposal could ultimately reduce one federal reporting requirement, it should not be interpreted as a broader reduction in equal employment opportunity or federal contractor compliance obligations. 

Employers must continue to make employment decisions without regard to protected characteristics and comply with all applicable anti-discrimination laws. Employers should continue following existing federal equal employment opportunity laws, including:  

• Title VII of the Civil Rights Act - prohibits employment discrimination based on race, color, religion, sex, and national origin. Federal contractors and other covered employers must continue maintaining nondiscriminatory employment practices and complying with applicable equal employment opportunity requirements, regardless of any future changes to EEO reporting obligations. 

For federal government contractors, this proposal does not eliminate other federal compliance obligations that may still apply. Employers should continue to comply with all existing contractual and statutory requirements, including: 

• VETS-4212 reporting: Federal contractors and subcontractors with a federal contract or subcontract of $150,000 or more (based on the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA) threshold) must continue submitting annual VETS-4212 reports, which provide information regarding the employment of protected veterans within their workforce by September 30 each year.  As part of our normal compliance support process, C2 Essentials prepares draft VETS-4212 reports using available payroll and workforce data and provides them to applicable clients for review and confirmation prior to submission 

  
  

• Federal and state recordkeeping requirements related to employment decisions - Employers must continue maintaining appropriate employment records, including documentation related to hiring, promotions, compensation decisions, terminations, accommodations, and other employment actions, in accordance with applicable federal and state requirements. These records remain important for demonstrating compliance with equal employment opportunity obligations.  

  
  

Official Resources 

• EEOC News Release

  
  

• EEOC Notice of Proposed Rulemaking (NPRM)

The U.S. Department of Veterans Affairs (VA) has announced a significant multi-year technology modernization initiative intended to improve how veterans receive healthcare services and benefits. The effort focuses on replacing or integrating aging systems with modern cloud-based platforms, artificial intelligence (AI), enhanced collaboration tools, and improved data management. An initial award has been made to Salesforce (CRM) worth up to $1.6B to modernize veteran’s care.  

The modernization initiative is expected to support several operational improvements, including: 

• Streamlining administrative processes and reducing manual workloads for VA personnel. 

  
  

• Enhancing communication and coordination across VA offices and healthcare providers. 

  
  

• Improving access to information through better integration of existing data systems. 

  
  

• Expanding AI-assisted tools to help manage routine inquiries, care coordination, and benefits-related processes. 

The Department of Veterans Affairs operates the nation's largest integrated healthcare system, serving millions of enrolled veterans through more than 1,300 healthcare facilities with: 

• Approximately 17.6 million living U.S. veterans nationwide (FY 2025 estimate).  

  
  

• Approximately 9.1 million veterans enrolled in VA health care.  

  
  

• Approximately 6.3 million unique veteran patients receiving VA healthcare annually.  

  
  

Why This Matters for Government Contractors 

For contractors supporting the VA, this investment represents more than a technology upgrade. It signals the agency's continued commitment to digital transformation and may create additional opportunities for organizations providing: 

• Information technology modernization and cloud services. 

  
  

• Systems integration and data migration. 

  
  

• Cybersecurity and FedRAMP-compliant solutions. 

  
  

• Artificial intelligence and automation technologies. 

  
  

• Data analytics and business intelligence. 

  
  

• Training, change management, and end-user support. 

Small businesses and subcontractors should also monitor upcoming procurement opportunities, as large modernization programs frequently generate subcontracting needs across multiple technical disciplines. 

Understanding the Current Environment 

The VA continues to operate a combination of legacy information systems developed over many years. As with many large federal agencies, maintaining multiple platforms can create challenges related to data sharing, workflow efficiency, and user experience.

Modernization initiatives seek to improve interoperability, reduce administrative complexity, and provide employees with quicker access to the information needed to serve veterans. 

Government contractors that currently support—or are interested in supporting—the Department of Veterans Affairs should continue monitoring VA procurement announcements and teaming opportunities.

Organizations with expertise in cloud technologies, cybersecurity, AI, systems integration, data management, and workforce training may find new opportunities as the VA advances its modernization strategy. 

While the modernization effort is focused on improving services for veterans, it also reflects broader federal priorities to modernize legacy IT infrastructure, strengthen cybersecurity, improve data sharing, and responsibly deploy artificial intelligence.

These priorities continue to drive acquisition strategies across civilian and defense agencies, creating opportunities for contractors that provide cloud services, cybersecurity, systems integration, data management, AI-enabled solutions, training, and change management support. 

Additional Resources 

• U.S. Department of Veterans Affairs Newsroom – Official announcements on VA modernization initiatives, technology updates, and agency news.  

  
  

• VA Electronic Health Record Modernization Updates – Information on the VA's ongoing efforts to modernize its electronic health record systems and improve interoperability across veteran healthcare. This initiative has been a key component of the VA's broader digital transformation efforts.  

  
  

• SAM.gov Contract Opportunities – Federal procurement opportunities, including VA solicitations and subcontracting opportunities.  

  
  

• U.S. Department of Veterans Affairs Office of Small & Disadvantaged Business Utilization (OSDBU) – Resources for small businesses seeking to compete for VA contracts, including Veteran-Owned Small Businesses (VOSBs) and Service-Disabled Veteran-Owned Small Businesses (SDVOSBs). 

The Defense Counterintelligence and Security Agency (DCSA) Trusted Workforce 2.0 Rap Back expansion is being implemented through a phased approach. DCSA has confirmed that Phase 3 involves personnel who do not already have fingerprints available for enrollment, with additional operational guidance to follow. 

The Defense Counterintelligence and Security Agency (DCSA) is continuing implementation of Trusted Workforce 2.0 (TW 2.0) and the FBI Record of Arrest and Prosecution Back (Rap Back) program.  

The next phase of Trusted Workforce 2.0 Rap Back enrollment will require fingerprint collection for certain cleared personnel who do not have eligible fingerprints already on file. 

Rap Back supports continuous vetting by allowing authorized government agencies to receive notifications of certain criminal history record changes through fingerprint-based enrollment.  

As part of this phased implementation, DCSA is preparing for fingerprint collection for cleared personnel who do not already have eligible fingerprints available for Rap Back enrollment. Additional operational guidance, including collection procedures and applicable voucher information, is expected from DCSA as implementation progresses.  

Contractors should begin preparing now to avoid delays once fingerprint collection instructions and voucher codes become available. As part of the broader Rap Back transition, FSOs should also ensure required FBI advisements have been distributed to applicable cleared personnel and that documentation of distribution is maintained. 

Important: Each contractor’s Facility Security Officer (FSO) remains responsible for managing DCSA security requirements, coordinating employee actions, and maintaining required security documentation. C2 Essentials is providing this information as a compliance awareness resource. 

Current Status: Affected Personnel Identification 

DCSA is providing lists of potentially affected personnel ("Subjects") directly to Industry Security Management Offices (SMOs). 

Due to data volume and privacy considerations: 

• SMOs with fewer than 75 Subjects: Lists may include full names of affected individuals.  

  
  

• SMOs with 75 or more Subjects: Identifying information provided may be limited.  

If your organization identifies employees with common names and cannot confidently match an individual, please complete internal verification efforts first. If additional assistance is needed, organizations may contact the DCSA Industry Agency Liaison

Funding Timeline: Voucher Availability and Expiration 

DCSA is expected to provide fingerprint voucher codes intended to offset vendor costs associated with eligible Rap Back enrollments. 

Key considerations: 

• Voucher expiration: September 30, 2026  

  
  

• After expiration: Contractors may be responsible for vendor fingerprinting costs associated with required Rap Back enrollments.  

  
  

• Usage limitations: Voucher codes are intended only for Rap Back enrollment fingerprint processing and cannot be applied to unrelated background check activities.  

  
  

Recommended Contractor Actions 

1. Coordinate with Your FSO 

Ensure your Facility Security Officer or Security Management Office is monitoring official DCSA communications and preparing for upcoming requirements. 

2. Review Your Cleared Personnel Roster 

Once DCSA provides affected personnel information, verify identified individuals against your active cleared employee roster. 

3. Prepare Affected Personnel 

Inform impacted cleared employees that fingerprint collection may be required and that prompt scheduling may be necessary once DCSA procedures and voucher information become available. 

4. Maintain Documentation 

Continue maintaining required security documentation related to TW 2.0 implementation, including applicable FBI advisement distribution records.  

C2 Essentials will continue monitoring DCSA guidance and will provide additional updates as official implementation procedures become available. 

Maryland's Family and Medical Leave Insurance (FAMLI) program is moving into its implementation phase. Employers with employees working in Maryland should begin preparing now for registration, payroll deductions, and employee communications. 

FAMLI creates a state-administered paid family and medical leave benefit that provides eligible employees with partial wage replacement for qualifying family and medical leave. The program supplements—not replaces—your existing PTO, vacation, sick leave, or other employer-provided leave benefits. Employers should review their leave policies to ensure they coordinate appropriately with FAMLI and, where applicable, the federal Family and Medical Leave Act (FMLA).  

Client Action Items 

• Register your business in the Maryland FAMLI portal when registration opens in September 2026.  

  
  

• Authorize C2 Essentials as your Third-Party Administrator during the registration process.  

  
  

• No separate insurance purchase is needed if electing to participate in the Maryland State Plan. Consult with your benefits broker if you are considering a private plan*.   

  
  

How C2 Essentials Will Help 

As your HR and payroll compliance partner, C2 Essentials will: 

• Register as your authorized Third-Party Administrator (TPA).  

  
  

• Calculate and remit required FAMLI contributions.  

  
  

• Submit required quarterly wage reports.  

  
  

• Provide employee notices through C2Connection when released by the State.  

  
  

• Update client handbooks with Maryland FAMLI policy language.  

  
  

• Provide ongoing compliance guidance as additional regulations are issued.  

  
  

Key Employer Timeline 

Employer Contributions 

The initial State Plan contribution rate is 0.90% of covered wages beginning January 1, 2027. 

• Employers with fewer than 15 employees (counting employees inside and outside Maryland): 

  
  

• No mandatory employer contribution; employee payroll deductions may still apply.  

  
  

• Employers with 15 or more employees (counting employees inside and outside Maryland): 

  
  

• The total contribution is 0.90% of covered wages, with up to 0.45% deducted from employees and the remaining amount paid by the employer (unless the employer elects to pay a greater share).  

  
  

State Plan vs. Private Plan 

Employers should evaluate which option best meets their organization's needs before payroll deductions begin. 

Opting for the State Plan 

• No insurance policy is required.  

  
  

• Contributions are remitted directly to Maryland.  

  
  

• Employee claims are administered by the State.  

  
  

Opting for a Private Plan 

• Purchased through an insurance carrier or benefits broker.  

  
  

• Premiums will depend on factors such as: 

  
  

  • employer size  

    
    

  • payroll  

    
    

  • workforce demographics  

    
    

  • industry  

    
    

  • leave history  

    
    

  • plan design  

    
    

  • whether the employer already provides paid parental leave or short-term disability benefits  

    
    

• Must provide benefits that are at least equivalent to the State Plan.  

  
  

• May offer greater administrative flexibility for employers that already provide paid leave or short-term disability benefits.  

  
  

• Compare premiums and benefits and select a plan that provides benefits equal to or greater than Maryland's requirements.  

  
  

• Submit a Declaration of Intent and later a private plan application to Maryland within the required filing window.  

  
  

• Once approved, employees receive benefits through the private carrier rather than the State Plan.  

While TikTok has resumed broad availability to U.S. consumers, government contractors should remember that many federal agencies continue to prohibit the application on government-issued devices and may impose additional contractual cybersecurity requirements. The platform's availability to the general public does not alter existing federal security obligations. 

TikTok's availability in the United States highlights the importance of maintaining strong cybersecurity practices rather than focusing solely on the status of a single application. As a reminder the app has been banned since 2022: 

• 2022: Congress passed legislation prohibiting TikTok on federal government devices, citing cybersecurity and national security concerns. 

  
  

• 2023–2025: Additional legislation, court challenges, and executive actions addressed TikTok's ownership and continued operation in the United States. 

  
  

• Early 2026: TikTok's availability in the U.S. remained uncertain as legal and regulatory actions continued. 

Government contractors should remember that many federal agencies and contracts impose security requirements that may restrict the use of certain applications on government-issued devices or on devices used to access government systems and information. Employees should not assume that an application available to the general public is permitted in every government contracting environment. 

Now is a good time for contractors to review their acceptable use, mobile device, and Bring Your Own Device (BYOD) policies to ensure they remain aligned with customer requirements and current cybersecurity expectations. Organizations supporting federal agencies should remind employees to follow all agency-specific security policies, safeguard Controlled Unclassified Information (CUI) where applicable and report any questions regarding authorized software or mobile device use before installing applications that could present security or contractual compliance risks. 

Nebraska employers should be aware of a new state law that expands employee notification requirements in connection with large workforce reductions and business closures. 

Effective July 18, 2026, Legislative Bill 921 requires employers with 100 or more employees to provide advance notice before conducting a covered mass layoff or business closing. Under the new law, affected employees must receive notice at least 90 days prior to the planned employment action. 

• Mass Layoff: A reduction in force (not resulting from a business closing) causing employment loss at a single site during any 30-day period for 100 or more employees (excluding part-time staff) 

  
  

• Business Closing: The permanent or temporary shutdown of a single site of employment that results in an employment loss for 100 or more employees (excluding part-time staff) during any 30-day period.  

  
  

• Aggregation Rule: Layoffs that occur over a 90-day period are aggregated and counted together to determine if the 100-employee threshold has been met, unless the employer can show they resulted from separate and distinct actions. 

Employers operating in Nebraska may now be subject to both federal WARN (60 days) and Nebraska LB 921 (90 days). In practice, the longer state notice period will typically drive the compliance timeline, meaning employers should plan reductions in force with at least a 90-day horizon when both laws apply. 

This requirement is similar in purpose to the federal Worker Adjustment and Retraining Notification (WARN) Act; however, the Nebraska law may apply in different circumstances and establishes a separate state-level notice obligation that must be evaluated in addition to federal WARN requirements.  

Comparison: Nebraska LB 921 vs. Federal WARN Act 

Nebraska WARN’s Notice Content Requirements 

Nebraska WARN requires that notice to affected employees or their representatives and to the Nebraska Department of Labor contain the following information: 

• The name and address of the employment site where the business closing or mass layoff will occur, and the name and telephone number of a company official to contact for further information; 

  
  

• A statement as to whether the planned action is expected to be permanent or temporary and, if the entire business is to be closed, a statement to that effect; 

  
  

• The expected date of the first employment loss and the anticipated schedule for employment losses; 

  
  

• The job titles of positions to be affected and the names of the employees currently holding those jobs. Notices to the Department of Labor must also include the addresses of the affected employees (which the Department must keep confidential); 

Advance planning is critical when workforce reductions are being considered. Employers should review employee counts, assess whether notice requirements are triggered, and coordinate communications with legal counsel and HR professionals to ensure compliance. Failure to provide required notice may expose employers to potential penalties and other liabilities. 

Because workforce reduction decisions often involve multiple compliance considerations—including final pay requirements, benefits continuation, unemployment claims, and employee communications—employers should take a comprehensive approach when planning any large-scale employment action. 

C2 Essentials assists employers with workforce planning, reduction-in-force strategies, termination compliance, final pay obligations, COBRA administration, and state and federal employment law requirements. Clients with employees in Nebraska who are considering layoffs, facility closures, or organizational restructuring should contact their HR Business Partner as early as possible to discuss compliance obligations and develop an appropriate action plan.

Indiana employers should be aware of a new state law that increases enforcement authority related to the employment of individuals who are not authorized to work in the United States. 

Effective July 1, 2026, Indiana’s Senate Enrolled Act 76, also known as the FAIRNESS Act, prohibits employers from intentionally or recklessly recruiting, hiring, or employing workers unauthorized to work in the U.S. The Indiana Attorney General's Office will investigate suspected violations, and employers can face civil fines of up to $10,000 and the suspension or revocation of their business licenses. 

Under Senate Bill 76 (SB 76), the Indiana Attorney General may initiate an enforcement action against an employer when probable cause exists that the employer knowingly or intentionally recruited, hired, or continued to employ an unauthorized noncitizen within the state. The legislation reflects a growing trend among states to take a more active role in enforcing employment eligibility requirements traditionally associated with federal immigration law. 

While federal law has long prohibited employers from knowingly employing individuals who lack authorization to work in the United States, Indiana's new law creates an additional layer of potential state-level enforcement. As a result, employers should ensure that their hiring and onboarding practices are consistently applied and that employment eligibility verification requirements are completed accurately and on time. 

Federal law requires employers to complete Form I-9 for every employee hired in the United States to verify identity and work authorization. Key requirements include:

• Employees must complete Section 1 by their first day of work.  

  
  

• Employers must review original work authorization documents and complete Section 2 within three business days of the employee's start date.  

  
  

• Employers must retain Form I-9 for three years after hire or one year after termination, whichever is later.  

Employers should continue to follow Form I-9 requirements for all new hires and maintain appropriate documentation supporting employment authorization. Organizations should also ensure that managers and hiring personnel understand the importance of complying with employment verification procedures and avoiding  

Practices that could create liability under federal or state law. 

For federal contractors, compliance remains particularly important. Federal contracting regulations require participating employers to utilize the E-Verify system to confirm the employment eligibility of newly hired employees assigned to covered federal contracts. Proper use of E-Verify, combined with timely and accurate completion of Form I-9 requirements, can help reduce compliance risks and demonstrate good-faith efforts to verify work authorization.  E-Verify does not replace Form I-9. Employers required to use E-Verify must still complete and retain Form I-9 for all new hires. 

As part of our onboarding and compliance services, C2 Essentials processes new hires through E-Verify when required under applicable federal contracting regulations and assists clients with I-9 compliance best practices. Employers with operations in Indiana should review their hiring procedures and employment eligibility verification practices to ensure continued compliance with both federal requirements and evolving state laws. Clients with questions regarding I-9 or E-Verify obligations are encouraged to contact their HR team for guidance. 

Florida employers should be aware of recent changes to the enforcement procedures under the Florida Civil Rights Act (FCRA), the state's primary employment discrimination law. The FCRA prohibits discrimination in employment based on protected characteristics including race, color, religion, sex, pregnancy, national origin, age, disability, and marital status. 

Under legislation known as HB 1407, Florida has revised the timeline for individuals pursuing employment discrimination claims after receiving authorization to file a lawsuit.  The new law will take effect on July 1, 2026. 

Previously, employees who received a determination from the Florida Commission on Human Relations (FCHR) or a Notice of Right to Sue from the U.S. Equal Employment Opportunity Commission (EEOC) had a longer period to initiate a civil action. The new law establishes a more defined filing deadline. Going forward, a claim under the FCRA must be filed within one year of either: 

• The date the FCHR issues a determination of reasonable cause; or 

  
  

• The date the EEOC issues a Notice of Right to Sue (whichever occurs first). 

  
  

While this change primarily affects claimants and their legal representatives, employers should recognize that discrimination complaints may move through the administrative process and into litigation more quickly. As a result, organizations should remain diligent in documenting employment decisions, maintaining personnel records, and responding promptly to employee concerns involving discrimination, harassment, or retaliation. 

Employers are encouraged to review their equal employment opportunity policies, complaint reporting procedures, manager training programs, and record retention practices to ensure they support compliance with federal and state anti-discrimination laws. Thorough documentation and timely investigations remain critical components of a strong workplace compliance program. 

C2 Essentials assists employers with workplace investigations, anti-harassment and anti-discrimination policy reviews, supervisor training, and HR compliance guidance. Clients with employees in Florida who have questions regarding the Florida Civil Rights Act or employment discrimination compliance should contact their HR team for assistance.