One of the most nuanced yet important parts of running a small business without a dedicated HR department is ensuring you’re complying with every applicable HR law. You already have so many other things on your plate, but that won’t stop an enforcement agency from slapping you with an expensive fine—or worse.
Thankfully, you don’t need to know every single employment and labor law on the books. Some laws are only applicable to businesses in specific industries or those with a minimum number of employees. We’ve rounded up the most common HR laws you should know about, but be sure to look at any additional laws your state or city may have in place as well.
If your business is found in violation of anti-discrimination legislations, be prepared for serious consequences in both the eyes of the law and the court of public opinion. The U.S. Equal Employment Opportunity Commission (EEOC) enforces these laws, and they investigate instances of discrimination at any stage of the employment life cycle. This includes the application/interview process as well as hiring, firing, and promotion decisions.
Laws to know include:
- Titles I and V of the Americans with Disabilities Act of 1990 (ADA)*: prevents workplace discrimination against qualified people with disabilities
- Age Discrimination in Employment Act of 1967 (ADEA)**: prevents workplace discrimination against people who are 40 and older on the basis of age
- Equal Pay Act of 1963 (EPA): prevents pay discrepancies among employees of different genders who perform equal work in the same workplace
- Title VII of the Civil Rights Act of 1964*: prevents workplace discrimination on the basis of race, color, national origin, religion, or sex (also applies to gender identity and sexuality)
- Pregnancy Discrimination Act of 1978 (PDA)*: prevents workplace discrimination against people who are pregnant, give birth, or have health conditions related to pregnancy
*applies only to businesses with 15+ employees
**applies only to businesses with 20+ employees
Wages and hours laws
Wages and hours laws set standards for how much an employee must be paid, the amount of time they can be required to work, and the requirements employers must meet if an employee exceeds that amount of time. They also protect special employee circumstances, like needing to take unpaid leave or requiring non-citizen visa sponsorship. The Wage and Hour Division of the Department of Labor enforces these laws.
Laws to know include:
- Fair Labor Standards Act of 1938 (FLSA): sets standards for minimum wage, overtime pay, recordkeeping, child labor, and employee exemption status
- Family and Medical Leave Act of 1993 (FMLA)***: protects employees who need to take unpaid leave for medical- or family-related reasons (such as childbirth, adoption, serious health conditions, or caring for an ill family member) without losing their job or health insurance coverage
- Wage garnishment under Consumer Credit Protection Act of 1968 (CCPA): protects employees whose wages are garnished from being fired and limits the amount of wages that can be garnished in one week
- Migrant and Seasonal Agricultural Worker Protection Act: sets employment standards for farm workers, including wages, workers’ compensation, working conditions, transportation, and housing
- Immigration and Nationality Act of 1965 (INA): protects temporary, nonimmigrant workers who meet specific visa requirements, given the employer can prove a lack of qualified workers who are U.S. citizens (Note: the DOL Wage and Hour Division enforces only specific provisions of this law)
***applies only to businesses with 50+ employees
Workplace health and safety laws
The Occupational Safety and Health Act of 1970 (OSHA), enforced by the administration of the same name, is the primary workplace health and safety law you should know. This legislation outlines employer responsibilities for providing a safe workplace. For example, OSHA requires employers to provide proper tools and equipment so employees may do their job safely. OSHA also guarantees employees the right to adequate health and safety training in a language they understand and the right to request an OSHA inspection without retaliation.
Other workplace health and safety laws include workers’ compensation regulations, which are administered by the Office of Workers’ Compensation Programs (OWCP). These are usually industry-specific laws that provide care and compensation to workers who are injured on the job or develop health conditions because of their work. The Longshore and Harbor Workers’ Compensation Act and Black Lung Benefits Act are both examples of laws that provide benefits to workers and/or their survivors.
Employee benefits laws
Employee benefits laws, as the name suggests, regulate the benefits someone receives such as retirement and healthcare plans. These regulations are enforced by the Employee Benefits Security Administration (EBSA), which acts as a watchdog for employers or benefit plan administrators. The EBSA serves millions of employees, retirees, and their families.
Laws to know include:
- Employee Retirement Income Security Act of 1974 (ERISA): sets standards for pension plans in private industry
- Health Insurance Portability and Accountability Act (HIPAA): prevents group health plans from denying coverage based on pre-existing conditions or any other type of health-based discrimination against employees or their dependent family members
- Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA): provides temporary continuation of health insurance coverage to employees and their dependents when coverage is lost because of specific life events
- Affordable Care Act (ACA): requires employment-based group health plans to provide coverage for preventative services, prevents pre-existing condition exclusions, and extends coverage for dependents until age 26
Tools to comply with HR laws
Compliance with HR laws can be a lot to manage, especially when you’ve got so many other business needs that require your attention. Plus, the laws in this list are only the federal ones—your city or state may have additional legislations that you should know. To make sure you have all of your bases covered, consider implementing an HR software tool that will give you all the right information. Read our list of Top HR Software for Small Businesses 2021 to find the right solution for your business.