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How to Ensure Compliance with Labor and Employment Laws

Featured image by Robert Owen-Wahl via Pixabay

Labor and employment laws lie at the backbone of HR. Businesses and HR teams struggling with compliance risk expensive fines and reputational damages that can force them to close. According to the US Department of Labor, a violation such as failure to meet the minimum wage or overtime pay requirements can lead to a civil fine of up to $1,000 per violation.

Labor and employment laws are regularly updated. Moreover, state and local laws give additional requirements that HR teams must consider to ensure full compliance. So, how should you navigate the landscape?

Some ways to ensure HR compliance include creating an employee handbook, having a compliance checklist, using a contract or employee agreement, and working with an HR compliance team.

Here’s what you need to know about compliance with labor and employment laws. Ensure you’re following the law at all times.

What Are Labor Laws and Labor and Employment Law Compliance?

Labor and employment laws are mediators between the government, employers, organizations, unions, and workers. They provide rights and responsibilities for employees in different work settings and mandate everything from workers’ compensation to workplace safety and health requirements.

Organizations are responsible for staying up-to-date with changes in existing labor laws and complying with new labor laws as they’re formed. Failure to do so often results in heavy fines and punishment from the government.

What Are the Labor and Employment Laws and Regulations You Need to Keep in Mind?

The US has several labor and employment laws that businesses and HR teams must comply with. Most of these laws are unique to various industries and businesses. However, the following are the most common.

National Labor Relations Act (1935)

This act dictates the terms of labor relations in the private sector. It establishes certain rights for employees, such as the right to self-organize, bargain collectively, join labor organizations, and engage in other activities of mutual aid and protection.

Norris La-Guardia Act (1932)

This act protects workers’ rights to strike, assist someone else involved in a labor dispute, organize through a union, and peacefully picket and assemble.

Taft-Harley Act (1947)

This act makes amendments to the national labor relations act and forbids unfair labor practices by unions.

Fair Labor Standards Act (1938)

This law standardizes the eight-hour workday and prohibits child labor. It also institutes a minimum wage.

Labor Management Reporting and Disclosure Act (1959)

This law handles racketeering and corruption in labor unions, guaranteeing every union member the right to nominate and vote for union leadership, participate in discussions, and attend meetings.

Age Discrimination in Employment Act (1967)

This law prohibits employment discrimination against individuals aged 40 years or older. It also prohibits an employer from refusing to refer someone for employment because of age. It also prohibits unions from refusing someone membership based on age.

Title VII of the Civil Rights Act (1964)

This law forbids an employer from refusing to discharge or hire an individual or discriminating against them on terms, compensation, condition, or employment privileges due to their color, race, sex, religion, or national origin.

Family and Medical Leave Act (1993)

This law allows eligible employers to take unpaid leave for specific medical and family reasons without the danger of losing health insurance or their job.

Occupational Safety and Health Act (1970)

This law covers private sector businesses with at least two employees. Employers are mandated to keep the workplace free from hazards.

Section 503 of the Rehabilitation Act (2013)

This law seeks to protect individuals with disabilities and veterans, ensuring they have equal access to employment.


What Are the Most Common HR Compliance Issues with Labor and Employment Laws?

With the numerous labor and employment laws HR teams must comply with, it is certainly common for teams to make mistakes. Here are the most common ones.

Inappropriate Employment Interview Questions

You should avoid asking interview questions that pry into a candidate’s personal life, reveal protected characteristics, or disclose affiliations unrelated to the role. Basically, such questions can easily lead to a discrimination lawsuit.

Discriminatory Job Listings

Recruitment ads should avoid language that shows or insinuates a preference for a candidate based on protected characteristics or information such as color, race, sex, religion, disability, national origin, age, or genetic information.

Insecure Documents

Employee personal data must be kept confidential. HR teams must ensure all documents are securely stored and only accessible by authorized individuals in the company.

Illegal Criminal Background Checks

The hiring manager should certainly not do background checks. Moreover, it should only be conducted if a conditional employment offer has been made.

Misclassified Workers

Worker classification affects tax payments, overtime wages, and other employment needs and benefits. HR teams must properly classify workers, especially distinguishing employees from independent contractors.

How Can You Ensure Labor and Employment Law Compliance?

Here’s what you can do to ensure you’re on the right side of labor and employment laws.

Have an Employment Law Compliance Checklist

Basically, a labor and employment law compliance checklist helps your HR team stay organized. In most cases, you’ll need federal and state law posters within the business. You’ll also want to have your compliance notices compiled into a neat checklist that you can track.

Know Which Labor Laws Affect Your Business

Each business has unique federal and state laws it must comply with. Therefore, your HR team must learn the labor laws specific to the business to ensure compliance.

For instance, at the federal level, the Age Discrimination Act only applies if your organization has at least 20 employees. Furthermore, it is important to note that state laws might change this requirement.

Create an Employee Handbook

An employee handbook is an especially invaluable compliance tool. This is because it gives employees useful information about their rights and benefits and reduces misunderstandings that can lead to a lawsuit.

Generally speaking, you should have a schedule for updating this handbook to ensure it contains the most recent and accurate information. Moreover, each employee must sign an acknowledgment form confirming receipt of the handbook and any subsequent updates.

Use a Contract or Employment Agreement

HR teams must provide a contract or employment agreement for all new hires, whether full-time or part-time. This is because employee agreements legally bind the employment relationship and help protect the employee’s rights and those of your business.

Work with an HR Compliance Expert

Staying on top of compliance can be quite stressful. For most HR teams, little time is left on the table for other constructive tasks related to the business.

However, working with an HR compliance expert allows you to delegate all your compliance needs and ensure you’re at little risk of employment and labor lawsuits. Contact a professional today and discover the HR compliance solutions available for your business.


About the Author

Jocelyn King is the co-founder and CEO of VirgilHR. VirgilHR is a Software as a Service (SAAS) solution that empowers HR professionals to make smart employment-compliant decisions in real time. This automated solution helps HR teams deliver beautifully against HR compliance requirements. It ensures employers reduce risk and liability in the areas of employment and labor law and gives HR teams valuable time back to spend on important strategic objectives across the business.