Federal Employment Laws by Company Size: What Changes at 15, 20, 50 and 100 Employees

Growing companies rarely notice the moment they cross an employment-law threshold. Hire your fifteenth person and federal anti-discrimination law now applies to you. Reach fifty and you may owe employees job-protected leave and have to offer health coverage. None of these laws sends a letter when you qualify.

This guide lays out the main federal thresholds in order, with the agency responsible for each so you can check the source. It is a starting point, not legal advice. Two cautions before you read on:

• State and local law often applies sooner. Many states extend anti-discrimination, leave and wage laws to much smaller employers. Indiana, for example, has its own civil rights law administered by the Indiana Civil Rights Commission. Always check your state and every state where you have remote employees.
• Counting rules differ by law. Some count employees over 20 or more calendar weeks, some count full-time equivalents, some count only employees at or near one worksite. When you are close to a line, read the specific rule or ask.

From your first employee

These apply to almost every employer, regardless of size.

• Fair Labor Standards Act (FLSA). Minimum wage, overtime, recordkeeping and child labor rules, enforced by the U.S. Department of Labor's Wage and Hour Division. Coverage is broad: most employers are covered through enterprise or individual coverage. Classifying a role as exempt from overtime requires meeting both a salary test and a duties test; see exempt vs. non-exempt: the FLSA tests.
• Equal Pay Act. Equal pay for equal work regardless of sex. It is part of the FLSA, so it covers most employers no matter how small.
• Form I-9. Every employer must verify identity and work authorization for each new hire, using USCIS Form I-9. We cover the details in Form I-9 compliance for small employers.
• Federal and state payroll taxes. Withholding, Social Security and Medicare (FICA), and federal unemployment tax (FUTA), per IRS rules, plus your state's unemployment insurance program.
• Workplace safety (OSH Act). Employers must provide a workplace free of recognized serious hazards. OSHA's injury and illness recordkeeping rule partially exempts employers with ten or fewer employees and certain low-hazard industries, but every employer must report severe injuries and fatalities to OSHA.
• National Labor Relations Act (NLRA). Protects most private-sector employees' right to act together about pay and working conditions, union or not. It affects how handbook rules are written, which we discuss in employee handbook essentials.
• Uniformed Services Employment and Reemployment Rights Act (USERRA). Protects the jobs of employees who serve in the military, for employers of any size.
• Required posters. The Department of Labor's poster advisor tool shows which federal notices you must display.

At 15 employees

Fifteen is the most important federal line for most small businesses. The Equal Employment Opportunity Commission (EEOC) enforces these laws, which generally count employees who worked for you in 20 or more calendar weeks in the current or preceding year.

• Title VII of the Civil Rights Act. Prohibits discrimination based on race, color, religion, sex (including pregnancy, sexual orientation and gender identity) and national origin, plus harassment and retaliation.
• Americans with Disabilities Act (ADA), Title I. Prohibits disability discrimination and requires reasonable accommodation unless it would cause undue hardship.
• Pregnant Workers Fairness Act (PWFA). In effect since June 2023, it requires reasonable accommodations for known limitations related to pregnancy, childbirth or related medical conditions.
• Genetic Information Nondiscrimination Act (GINA), Title II. Restricts employers from requesting or using genetic information, including family medical history.

What changes in practice: you need a written anti-harassment policy with a real complaint process, managers who know how to respond to an accommodation request, and consistent documentation of hiring, discipline and termination decisions.

At 20 employees

• Age Discrimination in Employment Act (ADEA). Protects workers aged 40 and older from age discrimination. Severance agreements that include a release of age claims must meet the Older Workers Benefit Protection Act's requirements, including specific review and revocation periods.
• COBRA. Employers with 20 or more employees that offer a group health plan generally must offer continuation coverage to employees and dependents who lose coverage. The Department of Labor's Employee Benefits Security Administration publishes the notice requirements. Many states have "mini-COBRA" laws for smaller employers.

At 50 employees

• Family and Medical Leave Act (FMLA). Private employers with 50 or more employees in 20 or more workweeks in the current or preceding calendar year are covered. Individual employees are eligible when they have worked for you 12 months, have worked 1,250 hours in the past 12 months, and work at a location with 50 or more employees within 75 miles. Eligible employees can take up to 12 weeks of unpaid, job-protected leave for qualifying reasons.
• Affordable Care Act (ACA) employer mandate. An "applicable large employer," generally one with 50 or more full-time employees including full-time equivalents in the prior year, must offer affordable, minimum-value coverage to full-time employees or risk an IRS penalty, and must file Forms 1094-C and 1095-C each year.
• Affirmative action for federal contractors. Certain federal contractors and subcontractors with 50 or more employees and contracts above set dollar levels have additional obligations, overseen by the Department of Labor's Office of Federal Contract Compliance Programs.

FMLA and the ACA are where growing companies most often get caught out, because the counting rules are complex and the first leave request or IRS letter is usually the first sign. Plan for both when you pass about 40 employees.

At 100 employees

• EEO-1 Component 1 report. Private employers with 100 or more employees (or 50 or more for certain federal contractors) must file workforce demographic data with the EEOC each year.
• WARN Act. Employers with 100 or more employees (counting specific rules on part-time workers) generally must give 60 days' written notice before a plant closing or mass layoff that meets the law's thresholds. Some states have their own, broader "mini-WARN" laws.

A practical way to use this list

1. Write down your headcount today and the date you expect to cross the next line. Count everyone on payroll, including part-time and remote employees, and note which states they work in.
2. Check state law for each state where an employee works. This is usually where small employers have obligations they don't know about.
3. Update your handbook and processes before you cross the line, not after. Leave policies, accommodation processes and benefits eligibility all take time to set up properly.
4. Assign an owner. Someone in the business should own compliance, whether that is an internal HR person, an outside partner or the owner with help.
5. Re-check every year and whenever you open a new location or hire in a new state.

Our multi-state HR compliance guide covers what changes when your team spreads across state lines, and the HR compliance checklist for Indianapolis-area employers covers the Indiana basics.

How Signent HR helps

Signent HR works with growing employers on HR foundations and compliance, from handbooks and policies to manager guidance, as a fractional or outsourced HR partner. If you are approaching one of these thresholds and want a clear picture of what applies to you, schedule a discovery call. Existing clients can reach us through the client portal.