Labor and Employment Law Overview: North Carolina

This item is part of Labor and Employment Law Overview: Federal

Author: XpertHR Editorial Team

Summary

  • North Carolina law prohibits an employer from discriminating and retaliating against employees in a variety of protected classes. See EEO, Diversity and Employee Relations.
  • North Carolina requires the use of E-Verify and prohibits consideration of expunged criminal records, genetic information and HIV positive status in hiring decisions. See Recruiting and Hiring.
  • In North Carolina, there are many requirements relating to the minimum wage, overtime and child labor. See Wage and Hour.
  • North Carolina has a number of laws that relate to employee pay and benefits, including health care continuation coverage, wage deductions, wage payment and pay statements. See Pay and Benefits.
  • Under North Carolina law, employees are entitled to a number of leaves, including domestic violence victims leave, military leave, parental school involvement leave, jury duty leave and volunteer emergency responder service leave. See Attendance and Leave.
  • North Carolina law requires an employer to provide a safe working environment for its employees and has its own state Occupational Safety and Health Act. See Health and Safety.
  • State law dictates final paycheck requirements and provides immunity for honest references. See Organizational Exit.

Introduction to Employment Law in North Carolina

North Carolina is generally considered an employer-friendly state.

Select North Carolina employment requirements are summarized below to help an employer understand the range of employment laws affecting the employer-employee relationship in the state. An employer must comply with both federal and state law.

An employer must also comply with applicable municipal law obligations affecting the employment relationship, in addition to complying with state and federal requirements.

EEO, Diversity and Employee Relations

Key North Carolina requirements impacting EEO, diversity and employee relations are:

Equal Employment Practices Act

The Equal Employment Practices Act applies to employers with 15 or more employees and makes it the public policy of North Carolina to safeguard against discrimination based on the following:

  • Race;
  • Color;
  • National origin;
  • Religion;
  • Age;
  • Sex (including pregnancy); and
  • Handicap.

North Carolina Persons With Disabilities Protection Act

The North Carolina Persons With Disabilities Protection Act applies to employers with 15 or more employees and prohibits discrimination against a qualified employee or applicant on the basis of a physical or mental disability or perceived disability.

A North Carolina employer is prohibited from asking applicants to identify themselves as disabled prior to a conditional offer. Once an employee with a disability requests a reasonable accommodation, the employer must investigate whether a reasonable accommodation can be made and accommodate the individual if possible.

The North Carolina Persons With Disabilities Act also prohibits retaliation against any person who exercises his or her rights under the Act; testifies, assists or participates in any way in proceedings related to the Act; or opposes any practice related to the Act.

Retaliatory Employment Discrimination Act

The Retaliatory Employment Discrimination Act (REDA) prohibits an employer from taking any punitive or adverse action against any employee for filing (or threatening to file) a complaint, initiating an investigation or proceeding, testifying or providing information to any person in connection with several state statutes, including those governing the following:

  • Sickle cell or hemoglobin C trait discrimination;
  • Genetic information, testing or counseling discrimination;
  • Victims of domestic violence;
  • Military servicemembers;
  • Wage and hour;
  • Workers' compensation; and
  • Occupational safety and health.

Other Laws Prohibiting Discrimination

A North Carolina employer must comply with other laws that prohibit discrimination on a variety of bases, including:

  • Sickle cell or hemoglobin C traits;
  • HIV/AIDS status;
  • Military/national guard status;
  • Genetic information and testing; and
  • Lawful use of lawful products outside the workplace.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on discrimination, harassment and retaliation in North Carolina can be found in the North Carolina Employee Handbook Table of Contents, Disabilities (ADA): North Carolina, EEO - Discrimination: North Carolina, EEO - Harassment: North Carolina, EEO - Retaliation: North Carolina, Employee Discipline: North Carolina and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Disabilities (ADA): Federal, EEO - Discrimination: Federal, EEO - Harassment: Federal, EEO - Retaliation: Federal and Employee Discipline: Federal.

Recruiting and Hiring

Key North Carolina requirements impacting recruiting and hiring are:

Expunged Criminal Records

North Carolina law prohibits an employer from asking individuals on a job application, during an interview "or otherwise" about criminal convictions, charges or arrests that have been expunged.

E-Verify

North Carolina law requires that employers with 25 or more employees use E-Verify to confirm the work authorization of new hires. Employers are not required to use E-Verify to determine the work authorization for individuals whose terms of employment are less than nine months in a calendar year.

Genetic Testing

A North Carolina employer may not refuse to hire an applicant based on the person having requested genetic testing or counseling services, or on the basis of genetic information obtained concerning the person or a member of the person's family.

AIDS/HIV Testing

A North Carolina employer may not require an applicant to submit to HIV testing unless it is part of an annual medical exam. The result of a positive HIV test may not be used to deny employment unless the applicant poses a risk to others.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on recruiting and hiring practices in North Carolina can be found in the North Carolina Employee Handbook Table of Contents, Preemployment Testing: North Carolina, Immigration, Form I-9 and Work Visas: North Carolina and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Preemployment Screening and Testing: Federal and Immigration, Form I-9 and Work Visas: Federal.

Wage and Hour

Key North Carolina requirements impacting wages and hours are:

Minimum Wage

North Carolina's minimum wage is $7.25 per hour, the same as the federal minimum wage.

Overtime

North Carolina law generally requires an employer to pay covered employees overtime at a rate of one and one-half times the regular rate for all hours worked in excess of 40 hours in a workweek. Seasonal amusement and recreational establishments may pay overtime after 45 hours worked in a workweek.

Child Labor

Child labor laws in North Carolina restrict the occupations in which minors may be employed and the number of hours and times during which they may work.

All minors are prohibited from working in occupations declared to be hazardous by the US Department of Labor and the Commissioner of the North Carolina Department of Labor, as well as those enumerated in North Carolina law, including:

  • Work involving the risk of falling a distance of 10 feet or more;
  • Work in confined spaces as defined by OSHA;
  • Welding, brazing and torch cutting;
  • Work involving exposure to lead, benzene, quartz, silicon dioxide or asbestos silicate;
  • Work as an electrician or electrician's helper; and
  • Preparing, serving, dispensing or selling alcoholic beverages.

Minors 13 years old or younger are prohibited from working for an employer, except that minors who are 12 or 13 years old may distribute newspapers outside of school hours for no more than three hours a day.

North Carolina requirements governing the times during which minors may work differ depending on the minor's age and the employer's industry.

During the regular school term, no minor under 18 years of age who is enrolled in grade 12 or lower may work between the hours of 11:00 p.m. and 5:00 a.m. before a school day. However, this prohibition may be waived for 16- and 17-year-olds if the employer receives written permission from both the minor's parent and school principal.

Minors who are 14 and 15 years of age may not work:

  • During school hours;
  • Before 7:00 a.m. or after 7:00 p.m. (9:00 p.m. when school is not in session);
  • More than three hours per day on school days, or eight hours on nonschool days; and
  • More than 18 hours a week during school weeks, or 40 hours during nonschool weeks.

Minors under 16 years of age must receive at least a 30-minute rest break after working five consecutive hours.

North Carolina requires minors to have a youth employment certificate to work.

Most of the above youth employment restrictions do not apply to certain occupations, including:

  • Agricultural occupations;
  • Modeling, acting and performing in the entertainment industry;
  • Production-related positions in outdoor dramas; and
  • Employment by a parent or guardian.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on wage and hour practices in North Carolina can be found in the North Carolina Employee Handbook Table of Contents, Minimum Wage: North Carolina, Overtime: North Carolina, Hours Worked: North Carolina, Child Labor: North Carolina, North Carolina Workplace Labor and Employment Law Posters and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Minimum Wage: Federal, Overtime: Federal, Hours Worked: Federal and Child Labor: Federal.

Pay and Benefits

Key North Carolina requirements impacting pay and benefits are:

Health Care Continuation

North Carolina's health care continuation coverage law applies to fully insured plans covering two or more employees, regardless of the size of the employer. Under the law, an employer must offer continuation of heath care coverage for up to 18 months to an employee and his or her covered dependents who lose coverage due to termination of employment or loss of eligibility under the plan.

Continuation coverage does not have to include dental, vision, prescription drug or any other benefits provided under the group policy other than hospital, surgical or major medical benefits.

Payment of Wages

North Carolina law requires an employer to pay employee wages on regular paydays. Pay periods may be daily, weekly, biweekly, semimonthly or monthly. Wages based on bonuses, commissions or other forms of calculation may be paid as infrequently as annually if scheduled in advance.

Pay Statements

North Carolina employers are required to provide employees with an itemized written statement of deductions made from their wages for each pay period in which deductions are made.

Wage Deductions

North Carolina law prohibits an employer from withholding or diverting employee wages except in strictly limited circumstances, including:

  • Deductions required by state or federal law (e.g., child support and tax levies);
  • Deductions for the convenience of the employee (e.g., contributions to savings plans, union or club dues, and charitable contributions); and
  • Deductions for cash or inventory shortages or loss or damage to the employer's property.

Even where deductions are permissible, North Carolina law requires the employer to comply with numerous requirements that vary depending on the type of deduction, including:

  • Written authorization from the employee must be signed before the relevant payday and state the reason for the deduction;
  • If the amount is known, written authorization must also include the dollar amount of the deduction or percentage of wages to be withheld;
  • If the actual amount is not known in advance, before the deduction is made, the employer must provide the employee with written notice of the actual amount to be withheld and the employee must be informed in writing of the right to withdraw the authorization;
  • Deductions for the employer's benefit (e.g., cash or inventory shortages) are limited as follows (deductions for an employee's benefit are not limited):
  • In nonovertime workweeks, wages may be reduced to the minimum wage, but no lower; and
  • In overtime workweeks, wages may be reduced to the minimum wage for the first 40 hours; however, no deductions may be made from full-time and overtime wages (based on the employee's regular rate of pay).
  • An employer must provide seven days' advance notice to an employee if a deduction is to be made for cash or inventory shortages or loss or damage to an employer's property; and
  • An employer is prohibited from making deductions for the employer's benefit from the guaranteed salary of an exempt employee's wages.

An employer is not required to comply with voluntary wage assignments of future wages entered into by employees, unless the employer agrees in writing to honor the assignment.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on pay and benefits practices in North Carolina can be found in Health Care Continuation (COBRA): North Carolina, Payment of Wages: North Carolina, North Carolina Workplace Labor and Employment Law Posters and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Health Care Continuation (COBRA): Federal and Payment of Wages: Federal.

Attendance and Leave

North Carolina has several laws relating to required leaves for employees, which cover all employers. These laws include:

  • Parental school involvement leave;
  • Volunteer emergency responder leave;
  • Jury duty leave;
  • Domestic violence victims leave; and
  • Military leave.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on attendance and leave practices in North Carolina can be found in the North Carolina Employee Handbook Table of Contents, Jury Duty: North Carolina, Other Leaves: North Carolina, USERRA: North Carolina and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Jury Duty: Federal, Other Leaves: Federal and USERRA: Federal.

Health and Safety

Key North Carolina requirements impacting health and safety are:

Occupational Safety and Health Act of North Carolina

Most North Carolina employers must comply with the Occupational Safety and Health Act of North Carolina, which generally adopts all federal rules and creates a limited number of state-specific standards. North Carolina law also has some requirements that have no federal equivalent, such as those for safety committees and for safety and health programs.

Workplace Violence Prevention Act

North Carolina's Workplace Violence Prevention Act allows an employer to file civil no-contact orders (or restraining orders) on behalf of an employee to prevent acts of violence in the workplace.

Hazardous Chemicals Right to Know Act

Under North Carolina's Hazardous Chemicals Right to Know Act, an employer that manufactures, processes, uses, stores or produces hazardous chemicals must compile and maintain a hazardous substance list for each chemical stored in each work area or for the workplace as a whole in quantities of at least 55 gallons or 500 pounds (whichever is greater). The employer must provide this information to the local fire chief and to any person in North Carolina upon written request.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on health and safety requirements in North Carolina can be found in Employee Health: North Carolina, HR and Workplace Safety: North Carolina, North Carolina Workplace Labor and Employment Law Posters and Does This Law Apply to My Organization in North Carolina? Federal requirements can be found in Employee Health: Federal and HR and Workplace Safety (OSHA Compliance): Federal.

Organizational Exit

Key North Carolina requirements impacting organizational exit are:

Final Paycheck

Upon termination (voluntary or involuntary), North Carolina law provides that wages are due on or before the next regular payday, either in the usual manner of payment or by mail if requested by the employee. Wages based on bonuses, commissions or other forms of calculation must be paid on the first regular payday after the amount becomes calculable. These types of wages may not be forfeited unless the employee has been notified of the employer's written policy or practice regarding forfeiture.

Earned vacation pay, commissions and bonuses also may not be forfeited unless the employer has a written forfeiture clause in its vacation, commission, bonus or termination policy.

References

A North Carolina employer is generally immune from liability when providing job references upon employee request, unless it discloses information that is false or that it knew or reasonably should have known was false.

Be aware that where there is overlap between federal, state and/or local law, complying with the law that offers the greatest rights or benefits to the employee will generally apply.

Additional information on organizational exit practices in North Carolina can be found in Payment of Wages: North Carolina and Employee Communications: North Carolina. Federal requirements can be found in Payment of Wages: Federal and Employee Communications: Federal.