United States HR Glossary

The FLSA requires employers to pay non-exempt employees at least the federal minimum wage ($7.25/hr as of 2025) and 1.5× their regular rate for all hours worked beyond 40 in a workweek. State laws frequently set higher minimums. Violations carry back-pay liability, civil penalties, and in willful cases, criminal prosecution.

All US states except Montana default to at-will employment, though federal and state anti-discrimination laws, union agreements, and implied-contract exceptions can limit the doctrine. Misclassifying a termination as at-will when a protected characteristic was involved exposes employers to significant liability.

Employers must file a W-2 for every employee to whom they paid $600 or more in wages, or any amount if income, Social Security, or Medicare tax was withheld. Failure to file on time incurs penalties of $60–$310 per form depending on latency.

Employers with 50 or more employees within 75 miles must comply. Employees must have worked for the employer for at least 12 months and 1,250 hours in the past year. FMLA leave can run concurrently with state paid-leave programs. Interfering with or retaliating against an employee's FMLA rights is unlawful.

As of 2025, the FLSA minimum salary threshold for exemption is $684 per week ($35,568 annualised). Misclassifying employees as exempt to avoid overtime is the single largest source of FLSA litigation and can result in years of back-pay awards plus liquidated damages equal to the unpaid wages.

In 2025 the Social Security wage base is $176,100. The employer's share must be remitted to the IRS on a semi-weekly or monthly schedule depending on payroll size. Failure to deposit FICA taxes on time triggers the Trust Fund Recovery Penalty, which can be assessed personally against responsible parties.

I-9 forms must be completed within 3 business days of the employee's first day of work. Employers must retain I-9s for 3 years after the hire date or 1 year after employment ends, whichever is later. ICE (Immigration and Customs Enforcement) audits can result in fines of $272–$2,701 per technical violation and higher amounts for knowingly employing unauthorized workers.

Coverage requirements, benefit levels, and insurer options vary by state. Employers who fail to carry required workers' comp insurance face fines, loss of liability protection, and personal exposure for injured workers' damages. Premium rates are tied to industry risk classifications and claims history (experience modification rate).

Some states (California, Alaska, Nevada) mandate daily overtime on top of the federal weekly rule. The 'regular rate' includes hourly wages, salaries, commissions, and certain bonuses — it is not simply the base wage. Miscomputing the regular rate (e.g., omitting non-discretionary bonuses) is a frequent FLSA violation.

In 2025 the employee deferral limit is $23,500 ($31,000 for those aged 50+). Employers who offer matching contributions must apply them fairly under non-discrimination testing rules. ERISA governs plan administration, and fiduciary breaches can result in personal liability for plan administrators.