A Guide to Company Policies

Company Policies: A Guide 

Each year new legislation is passed emphasizing the importance of compliance in a highly regulated work environment. With these ever-changing state and federal employment laws, it is an increasing challenge for employers to stay on top of company policies. This is especially true with companies that have employees in multiple states.

Although it’s important to stay current with federal laws for essential requirements, states and municipalities often add further requirements to these laws. Business owners need to be aware and stay compliant with federal, state, and city laws. They also need to understand that failure to comply could have costly consequences.

The laws involved can vary by state or city, and in situations where you have employees in multiple states, certain laws apply regardless of the number of employees. You can address these and other pertinent company policies in your employee handbook.

It helps to start with the most common laws to ensure you meet state-by-state compliance.

Paid Sick Leave Policies

Paid sick leave laws differ by state based on factors such as:

  • Who is covered
  • Reasons leave can be used
  • Rates at which employees accrue paid leave
  • Waiting periods before paid sick leave can be used

Local jurisdictions often includeadditional paid sick leave requirements that are important to keep in mind when developing company policies to meet compliance.

Paid sick leave laws may mandate differing guidelines such as acceptable reasons for leave and record-keeping duties for employers depending on the jurisdiction. These laws need to be reviewed against your company’s current sick or PTO policies to ensure they are compliant with your state or city laws.


States with paid sick leave laws include Arizona, California, Colorado, Connecticut, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, New York, Oregan, Rhode Island, Vermont, Washington, and DC.

(*Note: Maine and Nevada have PTO laws not limited to sick time)

States with both state and local paid sick laws include:




Los Angeles


San Diego

San Francisco

Santa Monica


Montgomery County

New York

New York City

Westchester County




States with only local city or county paid sick laws include:  



Cook County




Saint Paul


Allegheny County



If you have employees in these areas, it is important to check the sick leave laws to determine which requirements will apply to your company.

Family Leave Policies

Private employers with 50 or more employees within a 75-mile radius and public agencies are required to comply with the Federal Family Medical Leave Act (FMLA). Some states have passed further laws to provide job-protected leave to many employees left out of the FMLA.

These laws include extending leave to employees of small businesses with fewer than 50 employees. Other laws have reduced the duration and hours worked requirements in their state leave laws, while still others have done away with these requirements completely.

Examples of the state-specific family leaves include New Jersey Family Leave Act (NJFLA), California Family Rights Act (CFRA), Vermont Parental and Family Leave Act (PFLA), and Oregon Family Leave Act (OFLA). Make sure company policies in your employee handbook address these state-specific laws if they apply to your company.

Crime Victims, Domestic and Sexual Violence Leaves

Several states have also passed laws that provide crime victims, including domestic violence and victims of sexual assault and stalking, time off from work to address the violence in their lives. Some of these laws include protections from employment discrimination related to the violence.

The details of each state’s leave laws and protections can vary significantly, so make sure you stay up to date on regulations that will affect your company policies.

Meal Break and Rest Period Company Policies

Under federal law, meal breaks and rest periods are not required except for youth; however, there are regulations on what is considered compensable and non-compensable time. When employers offer short breaks (5 – 20 minutes), this is considered compensable work hours.

On the other hand, meal periods (which, if provided, must be at least 30 minutes in duration), serve a different purpose and are not considered work time and are not compensable unless work is performed during the meal period.

At the state level, there are regulations when it comes to the length of break or meal period and when the break should be taken. For example, in some states there is a paid 10-minute break required for every 4 hours worked or a 30-minute meal period for every 5 consecutive hours of work.

Please note that these laws can also vary by other factors such as occupation type, collective bargaining agreements, population, and other factors. Check out all state Meal Period Laws and Paid Rest Period Requirements.

Legalized Marijuana Use Policy

Marijuana use company policies are becoming an increasingly hot topic for employers as use becomes legalized at the state level. Companies will need to keep up with necessary changes as we see more states legalizing marijuana.

Although marijuana use remains illegal at the federal level, many states have legalized it for medical use, and several states have legalized it for recreational use. To date, 37 states have some form of legalized marijuana use.

In many of the states that have legalized recreational marijuana, the laws allow employers to continue to maintain zero-tolerance drug policies based on federal law. However, several states are silent as to whether employers may limit or regulate an employee’s use of marijuana outside the workplace.

This is a complex topic that is ever-changing, and the issue will require employers to review and update drug and alcohol policies.

Minimum Wage Policies

The federal minimum wage for non-exempt employees is $7.25 per hour as contained in the Fair Labor Standards Act (FLSA). However, many states have their own minimum wage laws, and some wages may vary by county or city.

Several states also have an approved minimum rate increase by year, so make sure you stay on top of annual increases to State Minimum Wage Laws

Other Laws That Can Vary by State:

  • Final Paycheck Laws – Guides when employers must pay the final paycheck upon termination. Laws vary by voluntary or involuntary terminations by state.
  • Wage Deduction Laws – What can and cannot be deducted from an employee’s paycheck.
  • Drug and Alcohol Policy – This can vary, especially in regard to states with marijuana laws.
  • Ban the Box – Removal from job applications asking if candidates have a criminal record.
  • Salary History Bans – Prohibits employers from asking applicants about their current or past salaries or benefits.
  • New Hire Registry Reporting – Reporting new hires in a state database.
  • School/Parental Leave – Some states provide time off for parents to attend school-related events and activities for their children.
  • Voting Leaves – Time off and protections for employees to leave work to vote.
  • Jury Duty Policy – Some states require paid or unpaid time off to serve on a jury.
  • Child Labor Laws – Rules can vary by age and type of occupation.
  • Emergency Responders – Requirements for leave for volunteer emergency responders.
  • E-Verify Policy – Required Verification of Employment Eligibility.

The list above is not all-inclusive but rather a sample. Since many laws can affect employee rights and the workplace environment, it is critical to stay current to maintain a productive work atmosphere.

Keep Employee Handbooks Up to Date

It is highly recommended that companies have an employee handbook that is reviewed and updated every year to stay in compliance with changing employment laws.

HR Service Inc. can simplify your process of updating company policies in your employee handbook.

By Kay Gillespie, HR Business Partner, HR Service, Inc.

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