Employment 2025

USA – TEXAS Trends and Developments Contributed by: Sydnie Shimkus, Bell Nunnally & Martin

Recent Trends and Changes in Employment Law Following President Trump Taking Office: What Employers Need to Know Since President Donald Trump assumed office in Jan - uary 2025, various government entities, court rulings and state leaders have made conservative-trending decisions and rulings on labour and employment mat - ters. Below are several areas where these trends are apparent as well as outliers that employers need to be aware of. Acting general counsel of the National Labor Relations Board (NLRB) rescinds several NLRB memoranda On 27 January 2025, President Trump removed the general counsel of the NLRB, Jennifer Abruzzo, and board member Gwynne Wilcox, from their positions with the board. Abruzzo’s removal from her posi - tion was expected, but Wilcox’s dismissal marks the first time in the NLRB’s history that a President has removed a board member from office. Additionally, on 3 February 2025, William B Cowen was appointed acting general counsel of the NLRB. Cowen wasted no time in driving policy change, and on 14 February, he issued Memorandum 25-05, rescinding several memoranda issued by his prede - cessor on matters involving non-compete agreements, confidentiality clauses in settlement agreements and electronic monitoring of employees, among others. Cowen indicated he will publish new guidance on these hot topics or will abandon the former decisions altogether; however, he has not made any further decisions to date. Abruzzo was appointed NLRB general counsel by for - mer President Joesph R Biden in July 2021 and was set to serve a four-year term expiring in July 2025. Abruzzo’s removal was expected, as President Biden had previously fired her Trump-appointed predeces - sor Peter Robb. Gwynne Wilcox served as one of the five members of the board. Wilcox was nominated by former President Biden, and confirmed by the US Senate, to serve on the board in 2021. In 2023, she was again nominat - ed and confirmed for a second term, set to expire in August 2028.

Unlike Abruzzo, Wilcox’s removal was unanticipated. While federal courts have affirmed the President’s ability to remove the NLRB’s general counsel, this is the first time since the passage of the National Labor Relations Act (NLRA) in 1935 that a president has removed a board member. Following her removal, Wilcox was quick to indicate that she will be pursuing legal challenges to her termination, leaving open the possibility that the move could be overturned. As mentioned above, Abruzzo’s successor, acting general counsel Cowen, has rescinded several NLRB memoranda on significant issues in the labour and employment law field. In further detail, some notewor - thy rescissions include the following. • Non-competes: (a) GC 23-08 – generally found that noncompete agreements violate the NLRA; and (b) GC 25-01 – “stay-or-pay” provisions, where an employee is required to pay their employer if they separate employment and violate an em - ployee’s Section 7 rights under the NLRA. • Settlement agreements: (a) GC 23-05 – precluded severance agreements where employees broadly waived their rights and broad non-disparagement and confiden - tiality clauses in severance agreements were unlawful. • Electronic monitoring of employees: (a) GC 23-02 – protected against an employer’s use of intrusive artificial intelligence, algorithm- based decision-making and surveillance of concerted activity during break times and in non-work areas. With these rescissions, in Texas, employers can gen - erally continue to enforce reasonable non-compete agreements (specific considerations for employees in the healthcare industry are expanded upon below) to include non-disparagement and confidentiality clauses in severance agreements, and can continue to conduct surveillance of employees for reasonable business purposes.

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