Pennsylvania Labor Law Guide

Pennsylvania has a diverse and robust economy, with key sectors that include manufacturing, healthcare, technology, agriculture, and energy. The state’s strategic location provides businesses with access to major markets in the Northeast and along the East Coast. Proximity to major metropolitan areas such as Philadelphia and Pittsburgh is a big plus. The state has a sizable and diverse labor force. Major cities and educational institutions in the state help in attracting and retaining talent.

Pennsylvania State Labor Laws

Minimum Wage

$7.25

Overtime Wage

$1.5x Regular Wages

Meal Breaks

Not mandated

Rest Breaks

Paid if 20 minutes or less

Minimum Wage Mandates

The minimum wage in Pennsylvania is $7.25 per hour in 2023.

There is a legislative effort underway to raise the minimum wage to $15 over the next several years. But it’s not certain that the effort will succeed.

Overtime Rules

Overtime rules in Pennsylvania generally follow the guidelines set by the federal Fair Labor Standards Act (FLSA). It establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards.

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Non-exempt employees in Pennsylvania get overtime pay for the hours worked beyond 40 hours in a week. The overtime pay is calculated at 1.5 times the regular hourly pay.

Employers in Pennsylvania may implement alternative workweek schedules, such as compressed workweeks, but they must ensure that employees receive the appropriate overtime pay for hours worked beyond 40 in a workweek.

Meal and Rest Breaks

The state of Pennsylvania follows the federal labor law Fair Labor Standards Act (FLSA) for meal and rest breaks. The federal law does not require employers to provide meal or rest breaks for adult employees. Employers are free to offer breaks that follow applicable guidelines.

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If employee is completely relieved of duties during the meal break then it can be unpaid. Otherwise, employees are entitled to pay during the meal break.

The FLSA does not require employers to give rest breaks (less than 20 minutes) to adult employees. If employers choose to give short rest breaks, they must pay the employees for the time.

Employers in Pennsylvania also have to comply with any collective bargaining agreements, employment contracts, or industry-specific regulations that may require breaks.

Businesses  with young employees also have to comply with the federal child labor laws which require breaks for young workers.

Paid Leaves and time off rules in the state of Pennsylvania

Pennsylvania does not have a state law mandating paid leave for private sector employees. Paid leave policies, such as vacation, sick leave, and paid time off, are typically determined by employers based on company policies and employment contracts.

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However, there are federal laws that still apply to employers in Pennsylvania.

  • Federal Family and Medical Leave Act (FMLA): This federal law gives eligible employees with up to 12 weeks of unpaid, job-protected leave per year for certain family or medical reasons. While the leave is unpaid, employees may use accrued paid leave (such as sick leave or vacation) during FMLA leave.
  • Paid Time Off Policies: While not mandated by state law, most Pennsylvania employers offer paid time off (PTO) as part of their benefits package. PTO may include vacation days, personal days, and sick days, and employers usually have policies outlining accrual rates and usage.
  • Collective Bargaining Agreements: For employees covered by collective bargaining agreements, the terms related to paid leave and time off may be outlined in the agreement.

It’s advisable to check with the Pennsylvania Department of Labor & Industry or legal resources for the most up to date information

Exempt vs. Non-Exempt Classification

The classification of employees as exempt or non-exempt in the state of Pennsylvania follows the federal Fair Labor Standards Act (FLSA).

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Exempt Employees:

  • Salary Basis Test: Exempt employees are typically paid on a salary basis, meaning they receive a fixed salary that is not subject to reduction based on the quality or quantity of work performed.
  • Salary Level Test: Exempt employees must earn a minimum salary to qualify for exemption. The minimum salary for exemption is $684 per week.
  • Duties Test: Exempt employees must perform specific job duties that fall into one of the FLSA’s exempt categories, such as executive, administrative, professional, or certain computer-related duties.

Non-Exempt Employees:

  • Hourly Pay: Non-exempt employees are typically paid on an hourly basis and are entitled to overtime pay for hours worked beyond 40 hours in a workweek.
  • Overtime Pay: Overtime pay for non-exempt employees is generally calculated at 1.5 times their regular rate of pay for each hour worked beyond 40 hours in a workweek.
Equal Pay Act

The Equal Pay Act (EPA) is a federal law that prohibits wage discrimination on the basis of sex. The EPA ensures that employees performing substantially equal work receive equal pay, regardless of their gender.

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  • Equitable Work: Although a federal law, it applies to employers in all states, including the state of Pennsylvania. Under the EPA, employees are entitled to equal pay for equal work, which includes equal wages for jobs that require equal skill, effort, responsibility, and are performed under similar working conditions.
  • Employers may only pay different wages for substantially similar work if the differential is based on a bona fide factor other than gender. Bona fide factors may include education, training, experience, or other job-related factors.
  • In addition to the EPA, employers must also adhere to Title VII of the Civil Rights Act of 1964 that prohibits discrimination based on race, color, religion, and national origin.
Rules for hiring and firing employees in the state of Pennsylvania

Hiring and firing employees in Pennsylvania are governed by a combination of federal and state laws. It’s important for employers to be aware of these regulations to ensure compliance and fair treatment of employees.

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  • At-Will Employment: Pennsylvania is an at-will employment state, meaning that, absent a contract stating otherwise, employment relationships can be terminated by either the employer or the employee at any time, with or without cause, and with or without notice.
  • Anti-Discrimination Laws: Employers in Pennsylvania must comply with federal anti-discrimination laws, such as Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on race, color, religion, sex, or national origin. The Arizona Civil Rights Act provides additional protections. Termination decisions must comply with federal anti-discrimination laws, including those mentioned under hiring considerations.
  • Equal Employment Opportunity (EEO): Employers should provide equal employment opportunities to all individuals regardless of race, color, religion, sex, national origin, disability, or age.
  • Background Checks: Employers may conduct background checks on applicants, but they must comply with the Fair Credit Reporting Act (FCRA) and state laws regarding the use of criminal records in employment decisions. Pennsylvania does not generally restrict private employers from drug testing applicants as a condition of employment, but there are legal considerations.
  • Work Eligibility Verification: Employers are required to verify the work eligibility of employees through the Form I-9 process in compliance with federal immigration laws.
  • Final Paychecks: Employers are generally required to provide employees with their final paychecks promptly upon termination.
  • Unemployment Compensation: Employees terminated through no fault of their own may be eligible for unemployment benefits. Employers must comply with requirements related to unemployment insurance.
  • WARN Act: The federal Worker Adjustment and Retraining Notification (WARN) Act may apply to employers with 100 or more employees, requiring them to provide advance notice of plant closings or mass layoffs.

It is important for employers to remain well-informed about changes in employment laws and to seek guidance from legal professionals to ensure compliance with the latest regulations. It’s advisable to establish clear and meticulously documented employment policies and procedures to aid employers in complying with the labor laws.

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