Why knowing employment law is good for business

Being able to treat employees fairly and equitably at all times is key for the success of any business. The human resource is a key component of any business and one of the best ways to keep them on board and on side is to ensure that as an employer you meet the basic minimums expected by the state within which you operate. This article details the top four reasons employers need to know their local employment laws.

Fines and imprisonment for non-compliance

The most obvious consequence of not following the relevant employment laws is fines and depending on the severity, imprisonment. Employment laws related to health and safety and environmental protection have been the main reasons employers have faced possible jail time. Fines have also been handed out a plenty for non-compliance with National Minimum Wage (NMW) and for those who do not know how to calculate overtime in accordance with  employment laws.


Failing to follow local employment legislation is something that has the potential to irreparably damage a company’s reputation, leading to loss of clients and revenue. Failure to comply will be discovered, whether by labor inspectors or as employees become more informed of their rights. Damage to reputation can last longer than the financial cost of fines and is one of the main results of employers not doing what they should for their employees.

Loss of staff

As soon as word spreads among staff that employment laws are taken lightly or that the company doesn’t take health and safety seriously, staff will begin to look for safer more employee-centered work. To retain staff, you need to be sure that all the rights of employees are protected and that the relevant employment laws are implemented on a consistent basis.

Down time and loss of productivity

Dealing with protracted staffing issues will only adversely affect productivity, whether it is in the hiring and firing process, or anywhere in between. If your business has labor and employee issues, then you are also likely not to be working to capacity and reaching targets.

The main sources of employment law 

It must be remembered that not knowing the law is no reason to break the law. The following are the main pieces of legislation that must become common knowledge in the organization if you are to avoid the pitfalls as mentioned above.

Federal state employment laws: The civil rights act forms the basis for equality and non-discrimination, and this is carried through to the workplace. The Americans with disabilities Act, Age Discrimination in Employment Act, Equal Pay Act and the National Labor Relations Act are the main laws that will cover every employee across the country and there will also be state laws that reinforce these national standards. 

Common state law will also be able to decide on any non-statutory employment issues. So regardless of whether it is explicitly state in the federal laws, if there is any feeling of unfairness or untoward treatment, employees can access local state courts for relief.

As a business, you must be able to navigate these laws and implement them as best you can to protect your employees and in doing so, the company itself.

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