Key Employee Headcount Milestones for Small Businesses and Start-Ups: Staying Compliant with US Employment Laws

Running a small business or start-up in the United States involves more than just managing operations and driving growth. It also requires a thorough understanding of various employment laws that come into play as your workforce expands. Different legal requirements are triggered at different employee headcount milestones. Here, we’ll discuss these critical thresholds and what you, as a business owner, need to be aware of to stay compliant with US law.

1 Employee

Fair Labor Standards Act (FLSA)

The FLSA sets standards for minimum wage, overtime pay, and child labor. As soon as you hire your first employee, you must ensure that you are paying at least the federal minimum wage and proper overtime for hours worked over 40 in a workweek. Additionally, child labor laws under FLSA dictate the types of jobs and hours minors can work.

Occupational Safety and Health Act (OSHA)

OSHA mandates that employers provide a safe and healthy work environment. Even with just one employee, you are required to comply with safety standards and report serious workplace injuries and illnesses.

Immigration and Nationality Act (INA)

Under the INA, all employers must verify the employment eligibility of their employees by completing Form I-9. This verification ensures that all hires are authorized to work in the United States.

15 Employees

Title VII of the Civil Rights Act of 1964

When your business grows to 15 employees, you must comply with Title VII, which prohibits employment discrimination based on race, color, religion, sex, and national origin. This includes hiring, firing, promotions, and other employment practices.

Americans with Disabilities Act (ADA)

The ADA requires employers to provide reasonable accommodations to employees with disabilities and prohibits discrimination based on disability. This law aims to ensure equal opportunities for all employees.

Pregnancy Discrimination Act 

This act prohibits discrimination based on pregnancy, childbirth, or related medical conditions. Employers must treat pregnancy and related conditions the same as any other temporary disability.

20 Employees

Age Discrimination in Employment Act (ADEA)

The ADEA protects employees 40 years of age and older from discrimination based on age in hiring, promotion, discharge, compensation, and other terms, conditions, or privileges of employment.

Consolidated Omnibus Budget Reconciliation Act (COBRA)

COBRA requires that group health plans offer continued coverage to employees and their families in certain instances where coverage would otherwise be lost. This law applies to businesses with 20 or more employees.

50 Employees

Family and Medical Leave Act (FMLA) 

Once you reach 50 employees, the FMLA mandates that you provide eligible employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons. Employers must also maintain group health insurance coverage during this leave.

Affordable Care Act (ACA)

The ACA requires businesses with 50 or more full-time employees to offer affordable health insurance to their employees and their dependents. You must also report coverage information to the IRS.

Equal Employment Opportunity Commission (EEOC) EEO-1 Report

Businesses with 50 or more employees must file an annual EEO-1 Report. This report includes data on the composition of your workforce by job category, race, ethnicity, and gender, ensuring equal employment opportunities.

100 Employees

Worker Adjustment and Retraining Notification (WARN) Act

The WARN Act requires employers to provide 60 days’ advance notice of covered plant closings and mass layoffs. This law helps ensure that workers have adequate time to prepare for the transition.

Stay Informed and Compliant 

Navigating the complex landscape of employment laws can be daunting, but staying informed about these key milestones is crucial for maintaining compliance and avoiding legal issues. Regularly review federal, state, and local employment laws to ensure your business remains compliant as it grows.

At Career Strategy Consultants, we understand the challenges of managing a growing workforce. Our expert staffing services can help you find the right talent while ensuring compliance with all relevant employment laws. Contact us today to learn more about how we can support your business growth.

Legal Disclaimer: This blog is not legal advice. Please consult with an attorney regarding any of these topics to ensure your business complies with all applicable laws.