The Definition of Employer

What Is an Employer?

An employer is someone who has employees and can direct their work, including where, when, and how it is done. Employers can be organizations, government entities, companies, or individuals who employ individuals known as employees or staff members. Employers must withhold various taxes for their employees and provide protections against discrimination.

How Employers Operate

In exchange for an employee's services, an employer provides compensation, such as a salary or hourly wage that meets minimum wage requirements. Many employers offer benefits like health insurance and paid time off, as required by law under the Affordable Care Act. Employers must also adhere to regulations regarding the classification of employees as exempt or nonexempt.

Employer Responsibilities

Employers have legal obligations, such as paying taxes and providing benefits. Misclassifying employees as contractors can have legal repercussions, and employees who believe they are misclassified can seek assistance from government agencies or legal professionals. Employers must also comply with employment laws and regulations to avoid discrimination claims.

Hiring Practices

When hiring employees, employers must classify them as exempt or nonexempt based on their job duties. Exempt employees receive a fixed salary and are not eligible for overtime pay, while nonexempt employees are paid hourly and are entitled to overtime wages. Employers must accurately classify employees to ensure legal compliance and fair compensation.

Employment Agreements

Employees typically work under verbal, written, or implied contracts, and some employers use job offer letters to specify employment terms. In unionized workplaces, employers must adhere to union-negotiated agreements. Most states follow at-will employment standards, allowing employees to quit or be fired at any time, with some exceptions like Montana.

Terminating Employment

Employees usually provide two weeks' notice when resigning, but specific notice requirements may vary. Employers can terminate employees for reasons like poor performance or position elimination but must avoid discriminatory practices. Terminated employees have legal recourse if they believe their dismissal violates employment laws.