9 Things You Didn’t Know About Employment Law (SMB Edition)

Understanding employment law is important for both employers and employees in creating a fair and safe workplace. These laws, also known as labor laws, protect the rights of workers while also ensuring the success of businesses. 

While some common labor laws are well-known, such as minimum wage and anti-discrimination laws, there are several things about employment laws in Texas that may surprise you – especially as it relates to your growing SMB. 

Here are nine things you may not know:

1. There is a difference between an employee and a contractor.

The classification of a worker as an employee or an independent contractor depends on several factors. The classification is not based on preference so don’t fall for a worker asking or evening begging to be paid as a 1099 contractor.  If the classification is wrong, the employer will be on the hook often for unpaid overtime and employment taxes.  he DOL just published a new independent contractor test so make sure to look at whether your workforce is properly classified.  Get all the details here.

Employees are entitled to certain benefits and protections, while contractors are not. 

Factors to consider include the level of control, type of work performed, and whether the work is advertised as a separate business.

Note: Read the latest in our CLIENT ALERT: DOL Publishes New Independent Contractor Test

2. Family and Medical Leave Act (FMLA) has specific requirements.

FMLA grants employees the right to take medical leave for certain situations, but it must be applied for and has specific time limitations and conditions. 

Many employers misapply the FMLA in their workplace because they do not fully understand its eligibility requirements.  

The key with the FMLA is it only applies to employers with 50 or more employees.  So if you are a small business, you likely have no legal requirement to provide medical or maternity/paternity leave.  

Are your employees eligible?  Learn everything you need to know about FMLA right here.

3. Employers cannot deduct money from paychecks for reasonable mistakes.

Employers cannot deduct money from an employee’s paycheck to offset reasonable mistakes unless there is evidence of intentional or grossly negligent behavior.

This means that simple errors or honest mistakes made by employees should not result in financial penalties directly deducted from their wages.

Employers must be able to demonstrate that the employee deliberately or recklessly caused significant harm or financial loss in order to justify such deductions.

If an employee deliberately or recklessly caused financial harm (including stealing money), employers still need a signed wage deduction authorization in order to deduct from the employee’s wages.  

4. Off-work conduct can impact employment.

Employers may consider off-work conduct, especially on social media, when it affects the company’s reputation or violates legal protections. 

However, employers must be cautious when considering off-work conduct, such as social media activity, that could impact their company’s reputation, make the company liable or violate legal protections. 

To ensure they do not infringe on employees’ legal rights, it is advisable for employers to consult with an employment lawyer. They can provide guidance on navigating these complex issues effectively and within the confines of the law. 

5. A hostile work environment has a specific legal definition.

Not every unpleasant workplace qualifies as a hostile work environment. To meet the legal definition, the behavior must be pervasive, abusive, and make it impossible for the employee to do their job. 

Offensive jokes, insults, and physical assaults may create a hostile work environment, but isolated incidents may not meet this criteria.

Read: How to Respond to an Employment Discrimination Complaint

6. Workers have a right to refuse unsafe work.

In the state of Texas, workers are granted the essential right to refuse work if they believe they are being asked to perform in an unsafe workplace environment. 

This vital protection empowers employees to prioritize their well-being and serves as a fundamental aspect of workplace safety. As stated by occupational health and safety regulations, it is the responsibility of employers to diligently provide a secure work environment.

Employers must ensure compliance with and adherence to these regulations by implementing appropriate safety measures, conducting regular inspections, and addressing any potential hazards promptly. 

7. Being part of a protected group does not guarantee job security.

While employees who belong to a protected group are given important legal protections against discrimination, it is a common misconception that they cannot be fired. In reality, employers can terminate employment if the employee is failing to perform their job duties satisfactorily, regardless of their membership in a protected group. However, it is critical to note that it is illegal for employers to take any corrective action that is based on unlawful discrimination.

This means that employers cannot use an employee’s protected characteristics, such as their race, gender, sexual orientation, or disability, as a basis for any adverse employment action, including termination. 

8.Being fired may not always be illegal.

As an at-will employment state, Texas grants employers the authority to terminate employees at their discretion, without the need for a specific reason or advanced notice. This flexible employment arrangement allows employers the freedom to make staffing decisions based on their business needs. 

However, it is important for employers to be aware that there are still legal limitations in place, such as prohibitions on termination based on discriminatory factors or in violation of any existing employment contracts or agreements.

9. Lunch breaks and work breaks are not required by law in Texas.

While not required by law, many employers in Texas do provide unpaid lunch breaks and paid short breaks. Employers are, however, required to provide adequate restroom breaks and accommodate breastfeeding mothers and workers with disabilities.

Understanding these lesser-known aspects of employment law in Texas can help both employers and employees navigate the complexities of the workplace with confidence.

The Wrap – What you didn’t know about employment law

In summary, employment law can seem complex, but it’s important for small and medium-sized businesses to understand the basics. 

From at-will employment to protected characteristics, there are many factors to consider when managing a workforce. 

If you have questions or need expert guidance on employment and business legal matters, don’t hesitate to reach out to the Frisco employment lawyers at Simon | Paschal PLLC.

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