Employment Law

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What is Employment Law?

Employment law refers to a specific section of the law that defines and regulates the relationship between employers and their employees. People commonly confuse it with labor law, which regulates relationships between different companies, trade unions, and the government.


What’s important to understand is that the term employment law doesn’t denote a singular law, but rather a collection of employment laws on both the state and the federal level.

Why Do Employment Laws Exist?

The main purpose of employment laws is to protect the employees in the workplace. They define all the characteristics of a working relationship and ensure workplace safety, guarantee a fair hiring process, ban child labor, and provide workers with rights such as medical and parental leave.

Employers that break the law are often fined exorbitant amounts by the regulatory bodies that enforce them, plus they’re liable to get sued for unfair treatment by the worker who suffered consequences from the employer’s misconduct.

That said, employment laws also protect the employers. Employees are contractually obligated to perform their work duties, so employees reserve the right to terminate workers based on poor performance or inappropriate behavior.

How Does Employment Law Work?

Employment laws in the US function on both the federal and the state level. The federal employment laws are the rules and regulations that have passed Congress and have been signed by the president of the United States. Currently, the two federal employment laws include Title VII of the Civil Rights Act of 1964 and the Fair Labor Standards Act.

In addition to these federal laws, every state has the liberty to pass state-specific laws that further define and regulate the specifics of working relationships within the state, such as minimum wage laws, industry-specific employment (e.g., agriculture), and door-to-door sales.

Employment laws are enforced by a variety of regulatory bodies across the United States, including:

  • The U.S. Department of Labor (DOL)
  • Occupational Safety and Health Administration (OSHA)
  • Office of Workers Compensation Programs (OWCP)
  • Employee Benefits Security Administration (EBSA)
  • Veterans’ Employment and Training Service (VETS)
  • Wage and Hour Division (WHD)
  • Local governments and authorities

Examples of Employment Laws

As you can see, there are a ton of different areas that employment laws need to regulate and govern, ranging from protection from unfair treatment to safety in the workplace.

Here are a couple of employment laws that both employers and employees need to be aware of so they have a better understanding of their rights and responsibilities:

Family and Medical Leave

The Family and Medical Leave Act (FMLA) describes the circumstances in which employees are entitled to take unpaid leave for family or medical reasons. Additionally, under the FMLA, employees retain their group health insurance coverage under the same terms as if they did not take leave.

One thing to note is that the law permits both the employees to choose and the employers to request that the employee in question take accrued paid leave (paid vacation, sick, or family leave) for a part of the full duration of the FMLA leave.

Essentially, FMLA provides workers with a 12-week unpaid leave per year in the event of:

  • Birth of a child and/or childcare for children under the age of one
  • A child being placed with them for adoption or foster care for the first time
  • Having to care for a spouse, child, or parent with a serious medical condition
  • Having a serious medical condition that prevents them from performing their job
  • Any need or demand arising from the employee’s spouse, child, or parent considered “on active duty” in the military

Minimum Wage

The federal minimum wage in the United States is defined under The Fair Labor Standards Act and currently sits at $7.25/hour as of July 24, 2009. The minimum wage for workers who receive tips is $2.13/hour, provided that their wage plus the tips reach $7.25/hour (otherwise, the employer must cover the difference).

What this means is that it’s illegal for employers to pay their workers less than $7.25/hour. This serves as a safeguard against exploitation and underpaid labor.

One thing to note is that states are still free to individually state their own minimum wages. If they differ from the federal minimum, the higher wage rate will apply. Put simply, certain states can (and 30 of them plus Washington D.C. do) enforce higher minimum wages as a result of the living standards in said states.


Overtime is defined and regulated under the Fair Labor Standards Act (FLSA). The act states that all nonexempt employees must receive compensation for hours worked over the standard 40 hours per week.

It also defines the rate as “time and a half,” which simply means that overtime pay must be equal to 150% of their hourly rate. So, if someone was making $10 per hour, their overtime rate must not be lower than $15 per hour.

There is no limit under FLSA regarding the amount of hours someone can work overtime. Additionally, work done on Saturdays, Sundays, and holidays doesn’t automatically qualify as overtime work unless the person works more than 8 hours. For these instances, employers are free to offer regular hourly rates.

Key Terms of Employment Laws

In addition to these examples, there are key terms you need to know in order to understand conversations, debates, and articles related to employment laws. Here’s a quick breakdown of some of those terms (the list isn’t comprehensive):

  • Title VII: Refers to the Title VII of the Civil Rights Act of 1964. It prohibits employment discrimination based on race, religion, color, sex, and national origin.
  • Age Discrimination in Employment Act: ADEA prohibits employers from discriminating against workers who are 40 or older. This essentially ensures that people over 40 will be able to find employment until pension.
  • The Equal Pay Act: This act prohibits discrimination based on sex by paying employees different (lower) wages based on sex. This act was signed into law in 1963, a year before the Civil Rights Act, which also covers the topic in Title VII.
  • Americans with Disabilities Act (ADA): ADA prohibits discrimination against people with disabilities, ensuring that they’re provided employment opportunities, transportation, public accommodation, and access to both federal and state programs and services.
  • The Pregnancy Discrimination Act: This act effectively prevents employers from firing or otherwise discriminating against people on the basis of pregnancy, childbirth, and related conditions.
  • Genetic Information Nondiscrimination Act (GINA): GINA safeguards employees from discrimination based on their genetic information in regards to both employment and health insurance. Essentially, the medical history of the person’s family must be taken into account when assessing them.
  • Fair Labor Standards Act (FLSA): The FLSA defines minimum wage, overtime, and child labor standards for both full-time and part-time workers on a federal level. It applies both to workers in the private sector and in Federal, State, and local governments.
  • Consolidated Omnibus Budget Reconciliation Act (COBRA): This act essentially protects people from losing their health insurance as a result of willing or unwilling job loss. It lets them continue to use group health benefits provided by their group health coverage plan for a limited period of time under specific circumstances.
  • Occupational Safety and Health Administration (OSHA): OSHA is a regulatory body in the US that helps ensure safety in the workplace. The Administration also defines rules and regulations for workplace safety in different industries and can inspect businesses and fine them if they fail to implement said rules, regulations, and measures.
  • Wrongful termination: A term that denotes an employer breaking either an employment contract or a law (or multiple) when terminating an employee. The laws governing wrongful termination depend on the terms of the employment contract and may sometimes permit legal action against the employer.
  • At-will employment: This term is used to describe an employer’s right to fire an “at-will” employee at any time, for any reason, and without warning. “At-will” employees are the ones employed indefinitely by an organization, with the contract stating that either side can choose to end the relationship at any time. Naturally, it’s implied that neither side can break any of the applicable employment laws in the process.

Related Terms

Aleksandar Stevanovic
Software Reviews Expert
Aleksandar Stevanovic
Software Reviews Expert

Aleksandar Stevanovic spent 10 years honing his craft as a freelance content writer. He has a degree in Economics, and extensive experience in software, crypto, and cybersecurity industries. He covers a multitude of topics, writing factual and informative articles, helping individuals better understand the intricacies of the online world. Over the last two years, his research focus shifted more towards tech and software content, as evidenced by his publications on CEX.IO, Business2Community, and Techopedia. He believes in simplifying complex topics and bringing them closer to like-minded individuals. His work is as detail-oriented as it is creative, and is designed to…