Employment Law Basics – for the Small Business Owner – Part 1

1. The Big Bad Wolf – Employee Lawsuits.

The biggest fear of the business owner, other than losing money hand over fist, is being sued. And to make matters worse, the largest source of discontent in the business owner’s company is likely to be a current or former employee. This, the employer reasons, is really adding insult to injury, rubbing salt in the wounds, adding fuel to the fire, twisting the knife, and is a slap in the face – why? because the owner hired this litigant, invited them into their family, paid them to stay, work – and to eventually, inadvertently, sue them. 

But how afraid should the business owner be? Well, it depends on their size, to a certain extent. Some laws apply only to large or medium size employers based on the intent of the law. 

2. Discrimination Laws

The first type of laws that I will describe are the employment anti-discrimination laws. Broadly, these provide that certain classes of people, those historically subject to improper treatment in hiring, promotion, and termination, are protected by law and given a cause of action to sue their employer for mistreatment due solely or partially because of their class status. For example, the employer that lays off his pregnant female employee, because, he reasons, she will take valuable company time for maternity leave and childcare. This employee is given the right to sue her employer under federal law. Federal Anti-Discrimination Laws

Title VII of the Civil Rights Act of 1964Prohibits discrimination in employment based on race, religion, or national origin.15 or more employees.
Equal Pay Act of 1963Women must be paid the same wages as men for similar work.Most employees.
Americans with Disabilities ActProhibits discrimination in employment based on disability15 or more employees.
Age Discrimination in Employment ActProhibits discrimination based on age.20 or more employees.
Pregnancy Discrimination ActProhibits discrimination in employment based on pregnancy or against new mothers.15 or more employees.
Veterans Reemployment Rights ActProhibits discrimination based on military service.All employers.

In addition, federal contractors have additional obligations (please call for details). Moreover, North Carolina has wage-hour and labor laws which dictate rules with regard to child labor, wage-hour issues, minimum wage, over-time pay, and right-to-work laws. Here is a list of the applicable state anti-discrimination laws. State Anti-Discrimination Laws

N.C. Equal Employment Practices ActForbids discrimination based on race, religion, sex, national origin, color, age, or handicap.15 or more employees.
Persons with Disabilities Protection ActProhibits discrimination in employment based on physical or mental handicap.15 or more employees.

Finally, employers are required to hang posters on a variety of labor issues for the purpose of informing employees of their rights

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