By Bradley Hunt, Attorney at Law
The employer and employee relationship can be tricky to navigate. Conflict between employers and employees can have a huge impact on the growth and profitability of a business. If you own or manage a business, it is important to understand your rights as an employer and take proactive steps, so you are ready when and if employment issues arise.
Do You Need an Employment Contract?
In North Carolina, employment is “at-will,” meaning the employer is generally able to hire and fire at their discretion. That said, this does not mean a current or former employee might not file suit against the company. In certain situations, you may choose to protect your business with a clear and well-defined employment agreement (or employee contract). Such agreements are common in certain industries, including high tech and media. Often included in an employment agreement is a covenant not to compete, for instance, prohibiting a well-known on-air news personality from working for a rival station in the same market or barring a high-level software designer from working for a direct competitor for 12 months after their termination.
Covenants not to compete can be hard to enforce, so if you choose to use this type of agreement to protect your business, we recommend having it drafted by an employment law attorney.
Federal and State Employment Laws May Differ
Labor laws can be complex and may differ by state and internationally. This can be challenging, especially if your business operates in multiple states or countries. To protect your business, you should have at least a minimal understanding of these laws (and/or your employment law attorney on speed dial!). At a federal level, the US Department of Labor website www.dol.gov is a great resource for business owners and entrepreneurs. The North Carolina Department of Labor also has valuable information for employers. Learning how to operate your business within the bounds of federal and state labor laws is a key part of protecting your business.
What About Small Businesses?
Not every business is large enough to need a full scale human resources department. There are, however, steps small businesses can take to help avoid labor lawsuits. These include:
- Make sure you are paying all employees according to the current wage and hour guidelines. Review the rules for 1099 versus full-time employment and understand when overtime must be paid.
- Develop and implement workplace procedures and guidelines; these may include safety rules, policies on sexual harassment, privacy and data protection, etc.
- Outline specific termination practices for supervisors and managers to follow and share these with all employees. How should supervisors document and address wrongdoing by an employee? What offenses will result in immediate termination?
- Give employees easy-to-follow steps to report problems. For example, if an employee is being harassed by a supervisor, teammate, or even a vendor, who should they go to?
Being open and honest about workplace processes and systems is one of the best ways to protect your business. If you are transparent, everyone knows what to expect. Ongoing employee training can be helpful, as can a regular review of your policies and procedures. You will also want to keep your eyes open for any major changes to relevant policies and laws.
Need to speak to an employment law attorney? Brinkley Walser Stoner is here to help. Schedule your appointment today.