4 Employment Law Mistakes That Can Stop Startups Today • TechCrunch


Like the old one That being said, your people are your business’ most important asset. And that’s true for beginners too.

As we’ve seen over the past several years, attracting and retaining talented employees is one of the biggest challenges startups face. Without enough employees, finding a product market fit and expanding a business can be very difficult, if not impossible.

While startups love to “move fast and break things,” when it comes to building a workforce, it’s important to slow down and make sure you’re complying with employment laws and establishing healthy work practices.

In this article, we’ll go over four employment law mistakes that beginners should avoid making. But first, let’s review the scope of laws that may affect your startup and some of the dangers of non-compliance.

Which employment laws apply?

A poorly written employee handbook is often worse than a handbook.

All businesses need to know which employment laws apply. There are federal, state, and local laws and regulations that can impose obligations on your startup, and these can be about everything from paid leaves to non-compete agreements.

The difficulty in figuring this out increases when the business has different locations, as laws vary from state to state and city to city. Beyond jurisdictional differences, different laws and regulations apply based on the size of the company and the number of employees. For many federal laws, 50 employees is a necessary threshold — for example, private employers with fewer than 50 employees are not covered by family and medical leave laws, but may be covered by state family and medical leave laws.

The patchwork of different employment laws and regulations that may apply to your startup can be confusing. That’s why it’s important to focus on these issues and help your startup meet its obligations and get help when needed.



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