US Employment Law & Compliance Glossary
US employment law and compliance is the set of rules that govern how companies hire, pay, and manage people in the United States — the statutes and obligations every US employer and recruiter has to work within. This topic gathers the core terms, from the FLSA to at-will employment, each defined in plain English on its own page.
The US framework is a patchwork of federal statutes — the Fair Labor Standards Act on pay and hours, the Family and Medical Leave Act on leave, the Americans with Disabilities Act and Equal Employment Opportunity rules on discrimination — layered with state and local law such as ban-the-box. For anyone hiring US talent, or running a GCC that supports US operations, understanding these terms is essential to staying compliant and avoiding costly missteps.
These definitions are a plain-English orientation, not legal advice — but they give recruiters, HR teams, and hiring managers a shared vocabulary for the rules that shape US hiring. Always confirm specifics with qualified counsel.
19 terms in this topic · see all 277 in the A–Z glossary →
Terms 19
Affirmative Action Affirmative action is a set of US policies requiring certain employers — chiefly federal contractors — to take proactive steps to recruit and advance members of groups historically underrepresented in the workforce. It goes beyond simply avoiding discrimination and is a US-specific legal and regulatory concept. Read Affordable Care Act ACA The Affordable Care Act (ACA) is a US health-care law, enacted in 2010, that expanded access to health insurance and set rules for coverage. For employers, its key effect is a requirement that larger companies offer affordable, adequate health insurance to full-time employees. Read Americans with Disabilities Act ADA The Americans with Disabilities Act (ADA) is the US federal law prohibiting discrimination against people with disabilities, including in employment. It requires covered employers to provide reasonable accommodation to qualified employees and applicants with disabilities unless doing so would cause undue hardship. Read At-Will Employment At-will employment is a US legal doctrine under which either the employer or the employee can end the employment relationship at any time, for any lawful reason or no reason, and generally without notice. It is the default rule in most US states and does not apply outside the United States. Read Ban-the-Box Ban-the-box refers to US laws and policies that remove the check-box asking about criminal history from job applications, delaying any inquiry into a candidate’s record until later in the hiring process. The aim is to give applicants with past convictions a fairer chance to be judged on merit first. Read COBRA COBRA is a US law that lets employees and their dependants keep their employer group health insurance for a limited period after leaving a job or losing coverage. The individual pays the full premium themselves, so it is continuity of the same plan, not free cover. Read Equal Employment Opportunity EEO Equal Employment Opportunity (EEO) is the US principle, backed by federal law, that employment decisions must be made without discrimination on protected grounds such as race, colour, religion, sex, national origin, age, or disability. It is enforced by the Equal Employment Opportunity Commission (EEOC). Read Exempt vs Non-Exempt Employee Exempt and non-exempt describe whether an employee is entitled to overtime pay and certain wage protections. Non-exempt employees must be paid overtime for hours beyond the standard week, while exempt employees — typically salaried professionals in defined roles — are not, though the exact rules vary by country. Read Fair Labor Standards Act FLSA The Fair Labor Standards Act (FLSA) is the US federal law that sets the national minimum wage, overtime pay rules, record-keeping requirements, and child-labour standards. It is best known for defining which employees are exempt from overtime and which are non-exempt and must be paid time-and-a-half beyond 40 hours a week. Read Family and Medical Leave Act FMLA The Family and Medical Leave Act (FMLA) is the US federal law that entitles eligible employees to up to 12 weeks of unpaid, job-protected leave a year for specified family and medical reasons, such as a serious health condition or the birth or adoption of a child. It is US-specific and applies to covered employers. Read Form I-9 & E-Verify Form I-9 and E-Verify are the US mechanisms for confirming a new hire’s authorisation to work in the United States. Every US employer must complete a Form I-9 to verify each employee’s identity and work eligibility, while E-Verify is a voluntary (sometimes mandated) electronic system that checks I-9 data against government records. Read HR Compliance HR compliance is the practice of ensuring an organisation’s people policies and employment practices meet all applicable laws and regulations. It covers areas such as hiring, pay, working conditions, statutory benefits, and termination. Read Negligent Hiring Negligent hiring is a legal claim that an employer failed to exercise reasonable care when selecting an employee, and that this failure led to foreseeable harm caused by that employee. It typically arises when an employer skips or ignores background checks and hires someone whose known or discoverable history made the harm predictable. Read Non-Compete Agreement A non-compete agreement is a contract, or a clause within one, in which an employee agrees not to work for a competitor or start a competing business for a defined period and within a defined area after leaving the employer. Its purpose is to protect confidential information, client relationships, and trade secrets, but its enforceability varies sharply by jurisdiction. Read Non-Disclosure Agreement NDA A non-disclosure agreement (NDA) is a legally binding contract in which one or more parties agree to keep specified information confidential and not to disclose or misuse it. In employment, NDAs protect an organisation’s trade secrets, client data, product plans, and other sensitive information during and after the working relationship. Read Progressive Discipline Progressive discipline is a structured, escalating approach to addressing employee conduct or performance problems, moving through increasingly serious steps — typically a verbal warning, written warning, final warning, and dismissal — with a chance to improve at each stage. Its aim is to correct behaviour fairly and consistently while creating a documented record. Read Retaliation Retaliation is when an employer punishes an employee for exercising a protected right or raising a legitimate concern — such as reporting harassment, filing a complaint, whistleblowing, or taking statutory leave. Adverse actions like demotion, dismissal, pay cuts, or exclusion taken because of the protected activity are generally unlawful. Read Right-to-Work Right-to-work is a US state-level law that prohibits requiring employees to join a union or pay union dues as a condition of employment. It concerns union membership and fees, and — despite the name — has nothing to do with immigration or the legal right to work in a country. Read Second-Chance Hiring Second-chance hiring is the practice of deliberately considering and employing people with criminal records or other backgrounds that often exclude them from work, judging them on their ability to do the job rather than their history. It is also known as fair-chance hiring. ReadFrequently asked questions
What does at-will employment mean?
At-will employment means either the employer or the employee can end the relationship at any time, for almost any reason, without notice — the default in most US states. The main limits are that a firing cannot be for an illegal reason, such as discrimination or retaliation.
What is the difference between exempt and non-exempt employees?
Under the FLSA, non-exempt employees must be paid at least minimum wage and overtime for hours over 40 a week; exempt employees, typically salaried professionals meeting set tests, are not entitled to overtime. The classification determines overtime rights.
What is ban-the-box?
Ban-the-box laws remove the criminal-history checkbox from job applications, delaying any conviction question until later in hiring. The aim is to give people with records a fairer chance to be assessed on merit first.
What are I-9 and E-Verify?
Form I-9 is the mandatory US document verifying an employee’s identity and authorisation to work. E-Verify is an electronic system that checks that information against government records. Together they confirm a new hire can legally work in the US.