Iowa employers are facing a rapidly shifting employment law landscape as new technologies, evolving workplace expectations and changes in federal and state policy create fresh legal considerations.

From the rise of artificial intelligence in human resources to emerging litigation trends, immigration policy changes and a patchwork of state-level regulations, attorneys say businesses must stay on top of these changes to reduce risk and stay compliant.

“[AI] is almost the elephant in the room,” said Tom Cunningham, an attorney with Nyemaster Goode. “Employers are increasingly using AI platforms in human resource functions, particularly in recruiting, hiring, performance evaluations, compensation and termination decisions.”

Some of the most notable developments are early cases under the Pregnant Workers Fairness Act, which expands employer obligations for workplace accommodations.

Unlike the Americans with Disabilities Act, which generally does not require employers to remove essential job functions, the new law may require temporary adjustments to those functions during pregnancy and postpartum recovery periods, Cunningham said.

Another shift comes from a recent U.S. Supreme Court decision eliminating a higher standard for discrimination claims brought by majority-group employees, allowing those cases to proceed under the same standard as others.

Cunningham said he is currently handling such cases for the first time in his decadeslong career.

Employers with operations across multiple states are also facing growing complexity in areas such as paid leave and noncompete agreements.

While Iowa has not enacted statewide paid leave laws, neighboring states like Minnesota have implemented new requirements, making it difficult for employers to maintain consistent policies across state lines. 

“The one-size-fits-all PTO policy doesn’t always work for Iowa employers who have operations and substantial employee presence in other states,” Cunningham said.

Noncompete agreements present similar challenges, with some states enacting bans or restrictions while others maintain fewer limits, creating what Cunningham described as a “patchwork quilt” of enforceability.

As AI adoption accelerates, employers must also consider potential discrimination risks tied to automated decision-making.

Cunningham pointed to a recent Equal Employment Opportunity Commission settlement involving software that allegedly screened out older applicants, highlighting how existing laws apply to emerging technologies.

Even nonunionized workplaces are facing increased scrutiny under federal labor law.

The National Labor Relations Board has expanded its focus on employer policies, including handbook provisions, severance agreements and workplace rules that may interfere with employees’ rights to engage in protected activity.

“These decisions are continuing to be applied,” Cunningham said, emphasizing the importance of reviewing policies with legal counsel.

To reduce risk, Cunningham said it is important for managers and supervisors to be trained on both legal requirements and internal processes.

“Managers and supervisors should not be making those types of decisions in a vacuum and by themselves,” he said. “They should be involving well-trained human resource folks to make certain that we’re creating a productive, profitable and satisfying workplace for everybody.”

Looking ahead, attorneys expect continued developments in AI regulation, paid leave laws and workplace policies, along with ongoing shifts in return-to-office expectations and workplace accommodations.

What employment law issues are top of mind?

The Business Record asked legal and HR professionals to share the top issues they are monitoring in the employment law sector and explain the potential effects on employers and employees.

Here is some of what we heard.

Over the last year, increasing numbers of managers and employees are using AI to create talking points for difficult conversations. I’ve seen many examples of emails and text messages where someone leveraged an AI resource to generate constructive feedback or ask for a raise. In negotiations, when an employer receives an AI-generated demand letter citing laws from California or the UK, the employer is unlikely to want to work with that person to find common ground. A multiple-page letter with inflated numbers makes it hard for companies to see a path for genuine dialogue and compromise. Take a moment and read the draft with fresh eyes.

AI tools can help generate ideas. It is more important than ever to edit and reflect.

— Kay Oskvig, partner, Whitfield & Eddy Law Firm

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The significant changes in legal immigration policy require more awareness by employers and their foreign national employees regarding work authorization extensions and expirations, international travel and eligibility to embark on or continue the legal immigration process. Updating an I-9 for an employee who is legally working with TPS (temporary protected status) or a parole program is particularly challenging given numerous changes and, in many cases, terminations of those programs. Travel bans and delays in visa appointments and issuance make it even more important to check with a trusted immigration law advisor before international travel. Employers are also enacting policies and providing training regarding interaction with immigration enforcement agencies, which is not something most businesses expect. Especially for those who have a combination of public and private spaces, knowing what to do if ICE or other agents arrive is critical.

— Lori Chesser, president, Dentons Davis Brown

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The top issues I am helping employers navigate are the policy changes eliminating or significantly hindering legal immigration options.  

In 2025, it’s estimated that more than 1.6 million people lost their lawful status to live and work in the U.S. through the government’s elimination of humanitarian programs like TPS and CHNV. In September 2025, the government implemented a $100,000 fee to sponsor certain H-1B applicants. It’s greatly affecting hospitals, schools and other industries, many of which were already facing major recruitment challenges. Finally, travel bans are restricting entry to the U.S. for those from certain countries, as well as an “indefinite pause” on all asylum applications and adjudication of all immigration benefits for applicants from 19 countries. 

These policy changes are reshaping the labor market. The U.S. experienced net negative migration in 2025 for the first time since the Great Depression, meaning more people left than entered. This hurts Iowa businesses by worsening workforce shortages, slowing job growth, reducing consumer spending and ultimately weakening local and national economies.

— Kailey Blazek Naranjo, shareholder, Dentons Davis Brown

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Unfortunately, discrimination and harassment claims continue to be one of the top employment law issues not only in Iowa but across the United States. With an even greater focus on laws and protected classes identified, this is still a growing issue. An area of concern with these claims is retaliation. There has been a significant increase in retaliation claims of employees who allege they were punished after reporting harassment or discrimination. Large jury verdicts are common, and even weak claims are expensive to defend.

— Todd McDonald, president, ATW Training Solutions

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With employees working in states other than Iowa, employers must be vigilant about understanding and complying with various state laws on paid sick or family time, pay transparency, drug testing and restrictive covenants.  

Secondarily, employee and supervisor accountability is more important than ever and is demonstrably lacking in many workplaces. Accountability training is critical to maintain clear expectations, improve communication and promptly address issues. Accountability also helps organizations follow policies, regulations and ethical standards, which can minimize legal liability and reduce the risk of costly disputes or compliance violations.

— Mary Funk, employment attorney, Nyemaster Goode P.C.

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Issues of how to effectively use but also mitigate the problems associated with AI and the use of technology in the workplace only continue to grow. Every shortcut, app or cool new tool carries with it a downside in terms of confidentiality, data misuse and new and expanding ways to circumvent company policies. The law continues to expand in this area with state and federal regulation, executive orders and international expectations – not all of which take the same approach.

— Jo Ellen Whitney, shareholder and employment chair, Dentons Davis Brown

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The increasing use of AI in hiring, payroll processing and other HR functions requires careful oversight to ensure data privacy, transparency and compliance. Organizations must monitor evolving regulations, conduct bias audits and establish governance standards to prevent misuse or overreliance on low-quality AI outputs. At the same time, evaluating and integrating AI tools and system add-ons has become increasingly complex as well.   

As we expand geographically, navigating state leave law compliance is getting more complicated due to so many different regulations and detailed nuances.

— Cindi Summers, chief human resources officer, Baker Group

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Our plaintiff-side employment law firm continues to see a large majority of potential age- and disability-related employment claims as compared to other claims: gender, race, religion. A big part of this seems tied to an aging workforce and more employees speaking up about medical conditions and the need for accommodations.

— Brooke Timmer, partner, Timmer, Judkins & Borland