General rule of thumb: an employer of one is the same as an employer of many. Yes, there are minimums for a number of labor laws – but the numbers might surprise you. Here are some of the big ticket items.
If you have 1 employee, you must comply with:
The Fair Labor Standards Act (FLSA) – which governs basic minimum wage, overtime pay and exempt status.
The Equal Pay Act – an amendment to the FLSA, grants equal pay for equal work.
Fair and Accurate Credit Transaction Act – requires employers to take reasonable measures to reduce the risk of identity theft to their employees, and disposal of background check information.
Immigration Reform & Control Act – governs the I-9 requirements
Electronic Communications Privacy Act – protects wire, oral, and electronic communications while those communications are being made, are in transit, and when they are stored on computers. The Act applies to email, telephone conversations, and data stored electronically.
Employee Right to Know Laws – ensures that employers and employees can identify and understand hazardous chemical substances in their workplace, the physical and health hazards associated with them, and how to take protective action.
Employee Polygraph Protection Act – generally prevents employers from using lie detector tests, either for pre-employment screening or during the course of employment.
Federal Income Tax Withholding, Social Security/Medicare and state unemployment compensation tax – basically, you have to pay employer payroll taxes
Uniformed Services Employment & Re-employment Rights Act (USERRA) – provides military leave of absence to employees serving in the uniformed services. (Under state laws, there may be additional protection for family members of active duty personnel as well).
Consumer Credit Protection Act – protects employees from discharge because their wages have been garnished, and limits the garnishment amount
National Labor Relations Act (NLRA) – grants employees the right to form or join unions; engage in protected, concerted activities to address or improve working conditions; or refrain from engaging in these activities.
Labor Management Relations Act (Taft Hartley) – regulates unions and their power.
Employee Retirement Income Security Act (ERISA) – protects employee interests by governing pension and retirement plans.
Health Insurance Portability and Accountability Act (HIPAA) – establishes national standards to protect individuals’ medical records and other personal health information and applies to health plans, health care clearinghouses, and health care providers that conduct certain health care transactions electronically.
Occupational Safety and Health Ace (OSHA) – establishes that employers are responsible for providing a safe and healthful workplace, and keep their workplace free of serious recognized hazards.
California Paid Sick Leave -allows a minimum of 1 hour of paid sick leave for every 30 hours worked, for all employees (including part time and temporary workers).
California Paid Family Leave – wage replacement benefit for employees who must take time off to care for a family member, does not offer job protection
CAL OSHA – governs worker health and safety; requires that each employee maintain a written Injury and Illness Prevention Program.
California Time Off for Emergency Personnel – provides protected, unpaid time for emergency personnel to report for emergency duty.
California provided Time Off for School Appearances – allows parents or guardians protected, unpaid time to appear at school for requested parent/teacher meetings related to suspensions.
California Witness and Jury Duty Leave – allows employees protected, unpaid leave to appear as a witness and serve on a jury.
At employee #2:
Cal COBRA – California law that extends group benefits for terminated employees, under group rates.
When you hire your 5th employee:
California Pregnancy Disability – provides protected, unpaid leave for employees who are disabled due to pregnancy.
When you get to 15:
Americans with Disabilities Act (ADA) – provides civil rights protections to individuals with disabilities.
Civil Rights Act (Title VII), including Pregnancy Discrimination – prohibits employment discrimination based on a number of protected classes, including sex, race, religion and pregnancy.
Uniform Guidelines of Employee Selection Procedures – governs selection procedures used to make employment decisions to ensure they are non discriminatory.
Equal Opportunity Act – prohibits employment discrimination
California Organ and Bone Marrow Donor Leave – allows employees protected, paid leave for the purposes of organ and/or bone marrow donation.
Once you hit 20 employees:
Age Discrimination in Employment – protects individuals between 40 and 65 from age employment discrimination.
Consolidated Omnibus Budget Reconciliation Act (COBRA) – Federal law that extends group benefits for terminated employees, under group rates.
California’s Baby Bonding Leave – an adjunct to the California Family Rights Act, “Baby Bonding Leave” allows up to 12 weeks of protected, unpaid leave, to bond with a new child.
The 25 employee mark brings:
California Family-School Partnership Act – allows parents or guardians protected, unpaid time off to attend school activities.
50 is a magic number for:
Family Medical Leave Act (FMLA) – provides protected, unpaid leave for employees to care for their own, or a family member’s, serious illness. May also be taken to bond with a birth or adoptive child.
California Family Rights Act (CFRA) – similar to FMLA, this California specific protected, unpaid leave is for employees to care for their own, or a family member’s serious illness. May also be taken to bond with a birth or adoptive child.
Executive Order 11246 (federal contractors or subcontractors with $50,000 or more in government contracts) – imposes nondiscrimination and affirmative action requirements as a condition of doing business with the Federal Government.
EEO-1 Reporting (federal contractors or subcontractors with $50,000 or more in government contracts) – annual, compliance survey requiring company employment data, categorized by race/ethnicity, gender and job categories. It is an anti discrimination tool.
California Time Off for Training of Emergency Personnel – allows volunteer Firefighters time off for training.
Anti-Harrassment Training – you are required to provide bi-annual harassment training for all employees in a supervisory role, and within 6 months of a supervisor’s new hire or promotion. Take care – the 50 number includes independent contractors, temporary employees and out of state workers.
General rule of thumb: an employer of one is the same as an employer of many. Yes, there are minimums for a number of labor laws – but the numbers might surprise you.
75 is a special milestone:
California Worker Adjustment Retraining Notification Act (WARN) – plant closing and/or worker layoff notice requirements.
Once you reach 100 employees:
Worker Adjustment Retraining Notification Act (WARN) – Federal plant closing and/or worker layoff notice requirements.
EEO-1 Reporting (non federal contractors) – annual, compliance survey requiring company employment data, categorized by race/ethnicity, gender and job categories. It is an anti discrimination tool.
And finally – all employers (of 1 or 100) should think seriously about:
Confidentiality
Time Off Policies
Work Product Protection (Inventions Agreements)
Drug Free Workplace Policy
Payroll Guidelines
Keep in mind, the above is a very generalized snapshot. Also, the process of determining your employee number may not be straight forward – some provisions require a ‘lookback’ of 12 months. Just because your current payroll reflects 89 people, it doesn’t mean you are free from Federal WARN Act guidelines.
Consult your labor counsel or HR professional for detailed information on how these and other guidelines may effect your business.
The preceding is provided for general informational purposes only, and not intended to constitute legal advice.
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