What is employment law?
Employment laws cover the rules and regulations that govern an employer's relationship with his or her employees. It refers to everything from employment contracts and collective bargaining agreements to statutory laws about wages, worker safety, and protection against discrimination. If you own a business or are thinking of starting one, familiarize yourself with the applicable laws and regulations.
Understanding the at-will presumption
In most cases, an employer-employee relationship is presumed to be “at-will,” or entered into voluntarily by both parties. This means that either party can end the relationship at any time and for any reason, unless the relationship is subject to an employment contract. There are several exceptions to the at-will presumption, however. An employer, for example, cannot fire an employee for:
Discriminatory reasons such as age, disability, or gender
Filing a worker's compensation claim
In retaliation for whistleblowing — exposing a company's illegal practices
To avoid paying a large bonus
Even with at-will relationships, employers should be able to show good cause for firing an employee to avoid a wrongful termination lawsuit.
You can see what kinds of provisions are listed in an employment contract with Avvo's employment agreement template
Wages and hours
Hourly pay for non-exempt categories of workers are covered by federal law, and in some cases, state law. In addition, the Fair Labor Standards Act (FLSA) also sets out rules for overtime pay for hours worked above 40 per week. The FLSA also covers child labor and describes basic record-keeping requirements for employers.
There are many state and federal employment laws that protect employees against workplace hazards that can cause injury or disease. The Occupational Safety and Health Act (OSHA) was enacted in 1970 and sets workplace safety standards that employers must meet, or face civil or criminal penalties.
States have also passed worker's compensation laws to protect employees who are injured or disabled doing work-related activities. Worker's compensation laws require employers to contribute to a state fund that pays medical expenses and either temporary or permanent disability payments to injured employees.
Pensions and other benefits
Employers offering qualified pension plans or other retirement accounts are governed by the Employee Retirement Income Security Act, or ERISA. This law was passed in 1974 and establishes rules for participation, vesting, funding, reporting, disclosure, fiduciary responsibility, and enforcement for qualified retirement plans. These are complex regulations, and most employers who set up ERISA-compliant retirement plans seek the advice of a lawyer experienced with them.
The Family and Medical Leave Act (FAMLA) of 1994 also applies to businesses with 50 or more employees. FAMLA gives employees the right to take up to 12 weeks of unpaid leave per year for family reasons such as the birth or adoption of a child, or a serious health condition affecting the worker or family member.
If you are unsure whether a business policy or practice might be against the law, an attorney with experience in employment law can answer your questions.