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Employers' Frequently Asked Questions

Q: How much do I have to pay my employees?

A: This depends on the employee. Generally, if the employee is not an executive, professional or supervisor, you must pay at least minimum wage. The federally mandated minimum wage was $5.15 per hour for ten years until Congress raised it on July 24, 2007, to $5.85. Two more 70-cent increases were scheduled to take effect on the same date each in 2008 and 2009. Thus, as of July 24, 2009, the federally mandated minimum wage is $7.25 per hour. State law may require a higher minimum wage than the federal level, in which case the higher state wage applies. Some industries and special categories of employees may fall under minimum-wage exemptions.

Q: Can I fire an employee for any reason?

A: Most states recognize at-will employment, meaning that, in most circumstances, an employee without an employment contract to designate the term of employment can be fired at any time for any legal reason or for no reason. However, some jobs are covered by employment contracts requiring that employers have legitimate reasons for employee terminations.

Q: Am I allowed to administer drug and alcohol tests to my employees?

A: Employee drug and alcohol testing has become common. However, states vary widely in whether and to what extent they regulate such testing. An employer considering this testing should consult an employment attorney or the state labor agency about applicable laws. For some employers, federal law can also play a role. Particular employees may be subject to mandatory drug testing, like certain transportation workers. Other relevant factors can be whether there is a government contract or a unionized workplace.

Q: How do I find out if a potential employee is legally permitted to work in the United States?

A: Employers may only hire people legally authorized to work in the U.S. In most cases, upon hiring a new employee, citizen or noncitizen, the employer must complete a federal Employment Eligibility Verification form (I-9) for which the employer must review particular documents for proof of legal work eligibility. An employer must keep each I-9 on file for a certain time period. In addition to I-9s, employers may participate in E-Verify, a federal web-based program for confirming work eligibility. Consult an employment attorney about E-Verify, as some states have passed laws requiring or forbidding its use in certain circumstances.

Q: Do I have to give reasons for not hiring someone?

A: Usually a reason does not have to be given for rejecting a job applicant. However, an employer should document and preserve its job-related and nondiscriminatory reasons for refusal to hire in case it is later accused of illegal discrimination. Legitimate reasons for rejecting an applicant may include insufficient prior experience or education, unrealistic salary expectations, discourteousness, lack of professionalism or insufficient interest.

Q: Against what groups may employers not discriminate?

A: Federal laws prohibit discrimination in employment for certain protected classes such as race, color, national origin, sex, religion, age, disability, active military service, veteran status, pregnancy, union membership status or citizenship status. Varying by jurisdiction, state or local laws may protect additional classes, such as sexual orientation, status with regard to public assistance, legal activity during off-duty hours, unrelated criminal or arrest history, unfavorable military discharge or marital status. Some government jobs may provide added protections and sometimes different standards apply to certain small employers.

Q: Do I have to pay overtime to all of my employees?

A: Federal law requires that most hourly employees after 40 hours of work in a week receive 1.5 times their regular rate for additional hours. However, most employees in a supervisory or professional role do not receive overtime pay and there are other exempt categories of employees. State law may provide for overtime requirements more generous to certain employees.

Q: What do I do if I have an employee in the military and they want to take extended time off for service purposes?

A: In essence, if an employee is called up for active military duty and requests time off, under the Uniformed Services Employment and Reemployment Rights Act (USERRA) the employer must grant the request and preserve the job, including benefits and seniority. In most circumstances, an employer must not save the job for more than five years. Usually for one year after the employee returns the employer can only dismiss for cause.

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DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent legal counsel for advice on any legal matter.

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