6 Employment Laws Every Maryland Business Owner Should Know About
[Updated June 15, 2022]
Many Maryland business owners are not familiar with the federal and state laws that regulate their hiring practices and create employment contracts for their employees. Too many of these employers go on to violate some or all the labor laws, which can lead to legal problems. This is why it is so important for them to have a business attorney at hand who can help them out.
An experienced Maryland business attorney can guide you through each step without violating any law or regulation, making sure that your company complies with everything from employee compensation rules and regulations regarding taxes and benefits such as health insurance plans, paid time off policies, and more. They will also make sure that they stay up-to-date on any changes in the law affecting your workplace environment.
In addition, an attorney will provide you with expert advice for drafting employment contracts as well as severance agreements for terminated employees. These documents lay out what both parties agree upon should something happen during the termination.
Essential Maryland Business Laws
Every Maryland business owner should know about employment laws. If you are running a small business, or an employer or a manager, one of your top priorities is to know the basic rules and regulations pertaining to hiring new employees.
The main thing to know is that every state has different labor laws that apply to employers. It's important for any company in Maryland with more than 15 employees (or who employs workers in other states) to know what those labor laws are and follow them accordingly.
You want your hard work paying off by avoiding costly penalties while still providing your staff with a fair wage and safe working conditions - so it pays for you to do the research on these issues before diving into the workforce!
1. The Maryland Minimum Wage Act
The Maryland Minimum Wage Act is intended to protect workers from exploitation by ensuring they are paid a fair wage. This applies whether or not the employer or employee has over 4 employees. The current minimum wage requirements under the Maryland Minimum Wage and Overtime Law took effect Jan. 1, 2021.
2. The Equal Pay for Women Act of 2014
The Equal Pay for Women Act of 2014 addresses the inequalities in pay among men and women prohibits employers from paying women less than men for the same jobs. If any employer discriminates against a woman, they will have to pay $4000 in fines.
3. The Family and Medical Leave Act (FMLA)
The FMLA is a law that the government created to protect workers from losing their jobs because of temporary situations such as medical issues. It guarantees eligible employees 12 weeks of unpaid leave. During this time, you can take care of your family or recover from a serious medical condition.
4. Title VII of the Civil Rights Act of 1964 and Lilly Ledbetter Fair Pay Act of 2009
Title VII of the Civil Rights Act of 1964, as amended by the Lilly Ledbetter Fair Pay Act (2009), protects employees from wage discrimination based on sex. The Lilly Ledbetter Fair Pay Act was signed into law by President Obama on January 29, 2009. The bill is to correct a flaw in previous legislation that may have allowed for discrimination to go undetected.
5. Workers' Compensation Law: Coverage, Claims, and Benefits
As a business owner, you know how valuable your employees are to your success. To ensure their safety, make sure you are familiar with the Workers' Compensation requirements for employers in Maryland. Workers' Compensation is a compensation program that pays employees for their medical expenses, lost wages, and other benefits if they are injured on the job.
6. Employee Rights to Organize and Bargain Collectively
Maryland is an “at-will” work state. In other words, employees work at the will of their employers. Employers can hire or terminate an employee for almost any reason or no reason at all. The employee may not agree with the reason or believe the reason is fair. However, as long as the employer does not illegally discriminate based on protected classes or terminate an employee in violation of other labor protections, the employer is within its rights to terminate an employee whenever the employer deems appropriate.
Maryland being an “at-will” work state is important for understanding collective bargaining. “At will” is not the same as “right to work.” The terms do not mean the same thing, even though many people confuse and use them interchangeably.
The “employment at will” doctrine refers to firing an employee. However, “right to work” laws involve an employee’s rights while working for an employer. Therefore, the “right to work” becomes an essential factor when discussing an employee’s right to collective bargaining in Maryland.
The “right to work” doctrine established in the National Labor Relations Act of 1935 (NLRA) allows an employee the option of not participating in collective bargaining or union representation. However, it also protects the rights of employees to voluntarily participate in collective bargaining. Therefore, in a right-to-work state, an employee is neither required nor prohibited from participating in collective bargaining or a union.
Maryland does not have specific “right to work laws.” Therefore, it is generally not considered a “right to work” state. However, the State has enacted laws specifically prohibiting employers and employees from making “promises” related to the “right to work” protections in the NLRA as a condition of employment. Under Maryland Labor and Employment Code §4-304, employers cannot:
Force employees to join or remain a member of a labor organization
Prohibit any employee from joining or remaining a member of a labor organization
Terminate the employment relationship if the employee joins or remains a member of a labor organization
Courts are not permitted to grant relief to a party who made a promise that violates the code section. This law is based on the rights in Code §4-302 specifically providing the policy of the State of Maryland that employees are free to associate, organize, and designate a representative to negotiate the terms and conditions of employment.
Therefore, employees in Maryland may choose whether they wish to engage in collective bargaining. If you have questions about these issues, talk with our Maryland business law attorney. A business law attorney helps ensure your employment contracts, agreements, and other documents comply with state and federal laws regarding unions and other collective bargaining matters.
