Did you know that 50% of respondents said discrimination and harassment issues will likely expose employers to labor and employment law disputes in 2025? This alarming statistic from HR Morning reveals a growing compliance challenge for HR professionals. Employment laws in the United States are multi-layered, making it difficult for your HR department to pin down which rules you are expected to follow. Therefore, you should know key employment law differences. Federal laws apply nationwide, but you also need to understand the latest state laws where your business operates. Failing to comply with these laws can lead to fines, legal sanctions, and even criminal charges. Keep on scrolling to learn why employment laws exist, the major federal laws every employer must follow, and how these differ from state-level regulations.
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Why are Employment Laws Established?
Employment laws are established to empower and promote the protection of employees. Federal and state labor law guide you to set the legal standards to ensure every employee is being treated safely, fairly, and in accordance with mutual obligations. They help in the following ways,
Maintain the balance of power between employer and employee.
Prevent one employee from terminating the other without a reason
Create a process where employees have equal rights in discussing the working environment.
Set minimum standards on pay, without imposing restrictions on employers’ contracts and terms.
What are the Federal Employment Laws?
The U.S. Department of Labor (DOL) enforces more than 180 federal laws. These mandates and the regulations that implement them cover many workplace activities for about 165 million workers and 11 million workplaces. Here’s a brief overview of each federal law to help you maintain proper HR compliance and understand employment law differences:
Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act prescribes standards for wages and overtime pay, which affect most private and public employment. You must pay covered non-exempt employees (cashiers, bookkeepers, etc) at least the federal minimum wage of $725 per hour. Overtime pay at one-and-one-half times the regular rate applies after 40 hours per week. The act restricts work hours for children under 16 and prohibits dangerous job assignments for those under 18.
Title VII of the Civil Rights Act
Title VII prohibits employment discrimination based on race, color, religion, sex, or national origin. You cannot make hiring, firing, promotion, or compensation decisions based on these protected characteristics. The law applies to employers with 15 or more employees for 20 or more weeks per year. Sexual harassment and religious accommodation requirements also fall under this comprehensive anti-discrimination statute.
Americans with Disabilities Act (ADA)
The ADA prohibits discrimination against qualified individuals with disabilities in all employment practices. You must provide reasonable accommodations unless they cause undue hardship to your business operations. The law covers employers with 15 or more employees and extends to hiring, advancement, discharge, compensation, and training.
Age Discrimination in Employment Act (ADEA)
ADEA protects employees and job applicants age 40 and older from employment discrimination. You cannot make age-based decisions regarding hiring, firing, promotions, layoffs, compensation, or benefits. The labor law compliance applies to employers with 20 or more employees and includes provisions against retaliation. Age-related comments or preferences in job postings can create legal liability.
Family and Medical Leave Act (FMLA)
The Family and Medical Leave Act requires employers of 50 or more employees to give up to 12 weeks of unpaid, job-protected leave to eligible employees for the birth or adoption of a child or for the serious illness of the employee or a spouse, child or parent. Eligible employees must work for covered employers for at least 12 months and 1,250 hours. You must maintain health insurance coverage during FMLA leave and restore employees to equivalent positions.
Occupational Safety and Health Act (OSHA)
The Occupational Safety and Health (OSHA) Act is administered by the Occupational Safety and Health Administration (OSHA). Safety and health conditions in most private industries are regulated by OSHA or OSHA-approved state programs, which also cover public sector employers. You must provide a workplace free from recognized hazards and comply with specific safety standards. OSHA enforces compliance through inspections, investigations, and substantial penalties for violations.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
COBRA requires you to offer continued health insurance coverage to employees and their families after qualifying events. Coverage must be offered for 18 to 36 months, depending on the qualifying event type. You must provide proper notices within specific timeframes and collect premiums from qualified beneficiaries. Failure to comply results in significant penalties and potential lawsuits.
Pregnancy Discrimination Act (PDA)
The PDA prohibits discrimination based on pregnancy, childbirth, or related medical conditions. You must treat pregnancy-related disabilities the same as other temporary disabilities for employment purposes. Pregnant employees cannot be forced to take leave if they can perform their job duties. Health insurance plans must cover pregnancy-related expenses on the same terms as other medical conditions.
Immigration and Nationality Act (INA)
The Wage and Hour Division also enforces the labor standards provisions of the Immigration and Nationality Act that apply to aliens authorized to work in the U.S. under certain nonimmigrant visa programs (H-1B, H-1B1, H-1C, H2A). You must verify employee eligibility through Form I-9 completion within three days of hire. The law prohibits discrimination based on national origin or citizenship status for eligible workers. Proper documentation and record retention are essential for compliance.
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How Do Federal Employment Laws Differ from State Employment Laws?
You must learn to cover both federal and state-level employment laws simultaneously, understanding when each applies and how they interact. Here’s a brief overview of federal vs state employment laws
Aspect | Federal Laws | State Laws |
Scope | Apply nationwide to all states | Apply only within specific state boundaries |
Minimum Standards | Establish baseline requirements | Often exceed federal minimums |
Enforcement | Federal agencies (DOL, EEOC, OSHA) | State agencies and departments |
Penalties | Federal fines and sanctions | State-specific penalties (often higher) |
Coverage | Usually larger employers (15-50+ employees) | May cover smaller employers (5+ employees) |
Protected Classes | Race, sex, age, disability, religion | May include LGBTQ+, marital status, and political affiliation |
Minimum Wage | $7.25/hour (FLSA) | $15+ in CA, CT, MD, MA, NY, NJ, WA, DC |
Overtime | After 40 hours/week | Differs: After 8 hours/day or 40 hours/ day |
Paid Sick Leave | No federal requirement | 40 hours/year minimum |
Family Leave | 12 weeks unpaid (FMLA) | Paid leave in many states |
Background Checks | Equal Employment Opportunity | Ban-the-box in 37+ states |
At-Will Employment | Generally permitted | Montana requires just cause |
Meal/Rest Breaks | No federal requirement | Required in many states |
Final Paycheck | Next regular payday | Immediate to 3 days varies |
Key Employment Law Differences Among States
Each state sets its own employment law related to fair hiring and workplace safety. In fact, in most cases, state laws offer more protections than the federal ones. Make sure to analyze the required state’s department of labor to learn about the specific laws in place. Here’s a brief overview of HR compliance by state:
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State | Major Employment Laws | Primary Focus |
California | Fair Employment and Housing Act (FEHA) | Anti-discrimination, harassment protection |
California Family Rights Act (CFRA) | Family and medical leave |
Healthy Workplaces, Healthy Families Act | Paid sick leave |
AB 5 (Dynamex Decision) | Worker classification |
Unruh Civil Rights Act | Public accommodations, employment |
Texas | Texas Labor Code | General employment standards |
| Texas Commission on Human Rights Act | Anti-discrimination |
| Texas Payday Law | Wage payment requirements |
| Workers' Compensation Act | Workplace injury coverage |
| Right to Work Law | Union membership restrictions |
Florida | Florida Civil Rights Act (FCRA) | Anti-discrimination protection |
| Florida Minimum Wage Act | Wage standards |
| Florida Private Employer Drug Testing | Drug testing regulations |
| Workers' Compensation Law | Workplace injury coverage |
| Right to Work Law | Union membership restrictions |
New York | New York Human Rights Law | Anti-discrimination, harassment |
| New York HERO Act | Workplace safety standards |
| Paid Family Leave Act | Paid family leave benefits |
| New York City Fair Workweek Law | Predictable scheduling |
| Wage Theft Prevention Act | Wage notice requirements |
Illinois | Illinois Human Rights Act | Anti-discrimination protection |
| One Fair Wage Act | Minimum wage for tipped workers |
| Workers' Rights Amendment | Constitutional worker protections |
| Illinois Paid Leave for All Workers Act | Universal paid leave |
| Right to Privacy in the Workplace Act | Employee privacy protections |
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Stay Compliant and Safeguard Your Career
Employment law differences between federal and state regulations are essential knowledge for effective HR management. Workplace discrimination issues affect millions of employees, legal requirements are constantly evolving, and compliance failures expose organizations to significant risks. Therefore, you must be aware of when federal law takes precedence and when state laws provide additional protections, so that you can manage compliance for your business across multiple jurisdictions.
Ready to master employment law compliance? Enroll in our online HR Compliance Certification course today and get expert guidance on federal and state regulations to protect both your career and your company.
FAQs
1. What is the main purpose of employment laws?
Employment laws are designed to protect the rights of workers and employers. They set standards for fair pay, workplace safety, discrimination, harassment, and termination practices. These laws ensure workplaces remain safe, equitable, and free from unfair treatment.
2. How do federal and state employment laws differ?
Federal laws apply nationwide and set minimum standards for wages, discrimination, and safety. State laws can expand on these protections by adding stricter requirements, additional employee rights, or specific compliance rules based on the state’s priorities.
3. What happens if an employer violates employment laws?
Violations can lead to serious consequences, including fines, lawsuits, back pay orders, and even criminal penalties in severe cases. Employers may also face reputational damage and loss of employee trust.
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