The federal government does its best to balance incentives for entrepreneurs and investors with protections for employees. Small businesses don’t have all of the same rules and obligations regarding employment that larger companies do.
Instead, a business’s obligation to comply with different laws increases as its workforce grows. As a small company, the size of your staff will have a direct relationship with the obligations that you have to your workers under federal law.
One of the most basic rights of a worker is the right to a fair and reasonable wage. Even if you only have one staff member, you must adhere to federal rules that require equal pay for men and women performing equivalent jobs.
Once you have 15 or more employees, your company is subject to federal laws prohibiting discrimination based on protected characteristics. These include race, gender, national origin, family medical history, genetics, color, disability and religion.
Some companies, especially small ones, may favor younger employees that they can pay lower wages for unskilled work, like serving coffee or answering phone calls. Once you have 20 employees, federal age discrimination standards that prevent employers from considering someone’s age if they are over 40 also apply to the workplace.
After the company gets bigger than that, there may be other rules that impact your relationships with employees. For example, the Family and Medical Leave Act (FMLA) requires that you accommodate on paid leave if you have more than a certain number of workers and the employee requesting leave meet certain requirements.
As your company grows, getting good advice on your legal obligations to employees can help you avoid making mistakes that could lead to expensive claims.