Why State Laws Matter for HR
While federal employment laws establish a baseline of protections, many states provide broader or additional protections for employees. HR professionals must navigate both layers of regulation, applying whichever law provides the greater protection to the employee. For organizations operating in multiple states, this complexity multiplies significantly.
For HR professionals studying for the SHRM-CP or SHRM-SCP exam, understanding the interplay between federal and state employment laws is essential. The SHRM exam tests your knowledge of how state laws can expand on federal protections and your ability to determine which law applies in a given situation.
The general principle is clear: when state law provides greater protection than federal law, the state law controls. When federal law provides greater protection, federal law controls. HR professionals must always apply the law that is most favorable to the employee.
Key Areas Where State Laws Often Exceed Federal Standards
Several areas of employment law commonly see state laws that go beyond federal requirements:
- Minimum wage: Many states and municipalities have minimum wage rates significantly higher than the federal minimum wage. Some jurisdictions also have different rates for tipped employees and may eliminate the tip credit entirely.
- Anti-discrimination protections: State laws often protect additional categories not covered by federal law, such as marital status, sexual orientation (in states that adopted protections before Bostock), gender identity, political affiliation, and source of income. Many states also have lower employer-size thresholds than the federal 15-employee minimum.
- Paid leave: A growing number of states and cities mandate paid sick leave, paid family leave, or paid medical leave. These requirements go beyond the FMLA, which provides only unpaid leave at the federal level.
- Pay transparency: Several states now require employers to disclose salary ranges in job postings, ban salary history inquiries, or prohibit pay secrecy policies.
- Non-compete restrictions: States vary widely in their treatment of non-compete agreements, with some banning them entirely for most employees.
- Ban-the-box laws: Many states and cities restrict when employers can ask about criminal history during the hiring process.
Multi-State Compliance Challenges
Organizations with employees in multiple states face significant compliance challenges. Common issues include:
- Policy harmonization: Should the organization create a single policy that meets the strictest state standard, or develop state-specific policies? Each approach has trade-offs in terms of administrative burden, consistency, and cost.
- Remote work: Remote employees may be governed by the laws of the state where they work, not where the employer is headquartered. This creates new compliance obligations when employees relocate or work across state lines.
- Handbook supplements: Many multi-state employers use a base employee handbook with state-specific supplements that address variations in leave, wage, and anti-discrimination laws.
- Posting requirements: Most states require employers to post specific workplace notices. Multi-state employers must ensure they are posting the correct notices for each jurisdiction.
Staying Current with State Law Changes
State employment laws change frequently, making it essential for HR professionals to have systems in place for monitoring legal developments:
- Subscribe to legal updates: Follow employment law firms, SHRM, and state HR associations that publish regular updates on new legislation and regulatory changes.
- Build relationships with employment counsel: Work with attorneys in each state where you have employees, particularly for complex leave, accommodation, and termination questions.
- Audit policies regularly: Conduct annual reviews of HR policies and handbooks to ensure they reflect current state law requirements.
- Leverage HR technology: Use HRIS and compliance platforms that track state-specific requirements and alert you to changes.
- Network with peers: Connect with HR professionals in your industry who operate in similar states to share best practices and lessons learned.
For the SHRM exam, the key takeaway is that HR professionals must always be aware that state law may provide greater protections than federal law and must apply the standard most favorable to the employee.
Start Practicing Today
Multi-jurisdictional compliance is increasingly tested on the SHRM exam, which includes 134 questions over 4 hours at Prometric or OnVUE. Understand the principle of applying the most protective law and recognize common areas where state laws exceed federal standards.
SHRMpractice.com covers federal and state employment law topics relevant to the SHRM exam. Take our diagnostic to assess your knowledge, then sign up for comprehensive exam preparation. Check SHRM pass rate data to understand how well-prepared candidates perform.