Small Companies: Know Your Employment Laws!

by on May 17, 2014

 If you ever feel confused by the vast array of federal laws and regulations that govern your organization, rest assured you’re not alone. Still, many smaller companies often assume that all laws apply to them when, in fact, organizations with fewer than 100 employees may not be governed by particular legislation. Here’s a quick snapshot of key U.S. employment laws, organized by company size.


Company Size Laws and Other Employment Provisions That Govern Your Company General Guidelines
15 or more employees Title VII of the Civil Rights Act of 1964 Title VII stipulates that employers may not discriminate on the basis of race, color, religion, sex, or national origin. The Civil Rights Act of 1991 amended Title VII to include the right to jury trials and punitive damages.
Sexual harassment prohibitions The sexual harassment provisions of the Civil Rights Act apply to employers with 15 or more workers. Employers must take all reasonable steps to prevent harassment from occurring. Harassment on the basis of sex generally includes sexual harassment, gender harassment, and harassment based on pregnancy, childbirth, or related medical condition.
Pregnancy Discrimination Act of 1978 Broadens the definition of sex discrimination under Title VII to include pregnancy, childbirth, or related medical conditions. Prohibits employers from discriminating against pregnant women in employment benefits if they are capable of performing their job duties.
Americans with Disabilities Act (ADA) and the important 2008 ADAAA (Americans with Disabilities Act Amendments Act) The ADA requires that companies accommodate qualified individuals with disabilities. Note that this law covers not only employees but also extends to job applicants. The ADAAA of 2008 broadens the definition of a “disability” in response to a series of Supreme Court decisions that narrowed coverage earlier in the decade.
The Genetic Information Nondiscrimination Act of 2008 (GINA) Employers may not discriminate against employees or job applicants based on genetic information. The Act also strictly limits the disclosure of genetic information.
20 or more employees Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) and Health Insurance Portability and Accountability Act (HIPAA) of 1996 Any employer with a group insurance plan who has twenty or more employees must extend COBRA rights to continued benefits under the plan to all qualified beneficiaries. COBRA allows employees who might otherwise lose their health coverage to continue coverage through their ex-employer’s group plan at their own expense. HIPAA requires employers to provide terminating employees with a notice advising them of the availability of continued health insurance coverage.
Age Discrimination in Employment Act of 1967 (ADEA) Prohibits discrimination in employment against persons forty years of age or older. Exceptions are permitted where age is a bona fide occupational qualification. All public sector employers are covered regardless of the number of employees. For private sector employers to be covered, however, they must employ twenty or more employees for each working day in each of twenty ormore calendar weeks in the current or preceding year.
Equal Pay Act of 1963 The Equal Pay Act requires all employers covered by the FLSA to provide equal pay for equal work, regardless of sex.
50 or more employees Family and Medical Leave Act (FMLA) Companies are required to provide unpaid leaves of absence to a maximum of twelve weeks and to guarantee employees the right to return to their jobs if they need to tend to their own or a family member’s serious health condition or to bond with a newborn child.
Affirmative Action Plans (AAP) Federal and state contractors with fifty employees and $50,000 or more in government contracts must develop a written affirmative action plan.
100 or more employees Worker Adjustment and Retraining Notification Act (WARN) Companies must provide sixty days’ notice before laying off or terminating fifty or more employees.

There are also laws that aren’t tied to a company’s size and that cover all U.S. employers: federal and state wage and hour laws, the Immigration Reform and Control Act (that requires all workers to complete I-9 forms in order to verify their eligibility to work in the United States), OSHA laws (the Occupational Safety and Health Act), and USERRA—the Uniformed Services Employment and Re-Employment Rights Act of 1994, to name a few. Remember as well that individual states have their own worker protection categories covering everything from obesity to sexual preference to the right to carry and display weapons in your vehicle in the company parking lot. Each of the laws above, of course, could fill a library with books, dissertations, and articles. And despite the tremendous volumes of content available, many of the provisions of these laws are still being adjudicated and interpreted by the courts and making their way into the “case law” study books as we speak. Still, it’s not enough to simply learn about (and sometimes be paralyzed by) the vast array of laws and ordinances governing small companies: you’ve got to discern which ones apply to your organization, and keeping this short roadmap in mind will help you navigate the rapids of employment law in the workplace. Just remember to reach out to qualified legal counsel whenever there’s any question as to how a particular law or set of laws might potentially impact your company! To learn more about the federal employment laws profiled above as well as others not mentioned in this article, visit the U.S. Department of Labor’s “Summary of Major Laws of the Department of Labor” at You’ll have volumes of information at your fingertips organized as follows:

  • Wages & Hours

  • Workplace Safety & Health

  • Workers’ Compensationemployeelawgraphic

  • Employee Benefits

  • Unions & Their Members

  • Employee Protection

  • Uniformed Services Employment and Reemployment Rights Act

  • Employee Polygraph Protection Act

  • Garnishment of Wages

  • The Family and Medical Leave Act

  • Veterans’ Preference

  • Government Contracts, Grants, or Financial Aid

  • Migrant & Seasonal Agricultural Workers

  • Mine Safety & Health

  • Construction

  • Transportation

  • Plant Closings & Layoffs

  • Posters

  • Related Agencies

For more online information about where to find employment laws impacting your state, visit the U.S. Small Business Administration’s “Business Law and Regulations” website at: You can likewise search Google under the following categories: “[STATE] Employment Laws” “[STATE] Office of the Labor Commissioner” “[STATE] Department of Labor” Finally, it might be a wise investment to purchase a copy of your local Chamber of Commerce directory by searching “[STATE] Chamber of Commerce employment law directories.” Armed with these detailed and thorough low- or no-cost resources, you’ll have a law library at your fingertips to help you navigate the rapids of employment law and positive employee relations.