On the surface, employment laws seem fairly easy to navigate for new business owners. You offer someone an hourly wage equal to or higher than your state’s mandated minimum wage to work for you, and when the chosen date comes around, you pay them.
However, there are a lot of complexities and special cases around employment laws that all new business owners should know and understand. Since not knowing these things can get you into trouble with the federal or state governments, as well as putting you at risk for lawsuits. Let’s look at a few important employment laws and what they mean.
The Family and Medical Leave Act
Although many people have heard of the Family and Medical Leave Act (FMLA), they don’t know what it entails. It requires employers to give employees up to 12 weeks of unpaid leave for a physical or mental illness affecting themselves or a family member, or up to 26 weeks if the family member is an active-duty member of the military.
You and your employee will have paperwork to fill out, which is important as it protects both of you. The employee can’t get fired because their spouse has cancer, and you don’t have to deal with an employee who invents an “Uncle Brian” with cancer to get out of work. For more information, check out the FMLA Employer Handbook from the Department of Labor.
The Occupational Safety and Health Act
When most people hear “OSHA”, they think of the Occupational Safety and Health Administration, the governmental body that enforces labor laws and workplace safety standards. OSHA was created by an Act of Congress called “The Occupational Safety and Health Act”, also confusingly referred to as “OSHA”, which has additional requirements.
There are many facets of the law that most employees, even those who have worked in warehouses for years, may not know or understand. Many of the law’s requirements are so commonplace that employees simply take them for granted. It’s a good idea to familiarize yourself with its provisions.
Fair Labor Standards Act
The Fair Labor Standards Act (FLSA) covers most aspects of payroll. This includes how employees get paid, overtime, documentation, recordkeeping requirements, FISA tax requirements, and more.
You’ll also want to make sure to have the required “employee’s rights” posters and placards in a visible location that’s easily accessible, like the employee break room or a hallway. Not having them posted can get you into trouble.
Laws Specific to Your State
Finally, make sure you’re familiar with the laws specific to the state in which you are headquartered, as well as other states in which you do business. Imagine you have a business in Fargo, North Dakota, but many of your customers or clients live across the river in Moorhead, Minnesota. If you or any of your employees perform work-related functions anywhere in Minnesota, both you and they are subject to Minnesota’s labor laws. Also stay ahead of any changes in legislation that could impact you and your employees. Washington State passed a new higher minimum wage this year among other regulations.
Final Thoughts
For most new business owners, the most important laws to familiarize themselves with are the Family and Medical Leave Act, the Occupational Safety and Health Act, the Fair Labor Standards Act, and all applicable state and local laws for the jurisdictions covered by your headquarters, satellite offices, and locations across state lines where business is conducted.
It may seem overwhelming at first but owning a business can be a fun and profitable experience. As long as you understand and follow all relevant employment laws, you’ll be on your way to running a successful business in no time at all!
