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Understanding the Labor Law Basics


understanding the labor

As a business owner, it is likely that the growth of your business is one of your main goals. Growth can increase profit, allow you to expand into different areas, and give you the opportunity to bring on more team members. Growth is good, but it can impact the rules and regulations you must comply with as a business owner. These rules and regulations can change over time as your company grows and as you add on new types of employees. It is your responsibility asthe business owner to understand and comply with the labor laws that apply to your company.

There is a lot of information available about labor law and it can be overwhelming. But, information overload is not an acceptable excuse for violating labor laws. Start here, with the basics, and then move on to the more detailed information once you have a solid foundation.

  • The United States Department of Labor is the regulating agency

The U.S. Department of Labor (DOL) is the federal agency that enforces the laws and regulations related to workers and business ownersin the United States. There are different rules depending on the type and size of business you own. The type of employees you have also impacts the rules you must follow. As a business owner, you need to be familiar with the specific regulations that apply to your company. A good place to start learning about the DOL’s regulations is by becoming familiar with the Fair Labor Standards Act (FLSA). It is a set of regulations related to basic wage standards, overtime, exemptions, and more.

  • There are both federal and state regulations

One thing you need to understand about labor laws as a business owner is that there are both federal and state regulations. The federal regulations apply to all states and every business owner needs to be familiar with the rules and regulations of the DOL. You also need to be aware of the specific regulations for your state because they may be different than the federal regulations. For example, some states have a minimum wage that is higher than the federal minimum wage. In that case, the state law is the one that must be followed because it is the higher of the two.

  • You face citations and other actions if you do not comply

The DOL has the ability to investigate the business practices of your company if there is suspicion of FLSA violations. If violations are found, you may be asked to make changes in your employment practices to become compliant. In addition, you may have to pay an employee back wages for unpaid overtime if it is determined that you were not in compliance with the FLSA. If it is found that you continue to violate certain regulations you may have to pay penalties for each violation.

Ultimately, your best defense against being disciplined for violations is to become familiar with the regulations set forth by the U.S. Department of Labor.

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