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Your Guide to Hiring Employees and Contractors in United States

Capital city

Washington, D.C.

Currency

United States Dollar ($, USD)

Language(s)

English

Ease of doing business

Very easy

Payroll frequency

Monthly

Employer taxes

10 – 37%

Payroll

Payroll Cycle

There’s no mandatory payroll cycle in the United States, although private employers usually pay salaries twice a month.

Minimum Wage Requirements

Minimum wage rates in the United States are set by U.S labor law and a number of states and local laws. 

The federal minimum wage is fixed at $7.25 per hour, while state and local rates vary, with employees in SeaTac, Washington earning as high as $17.53 per hour.

Individual Income Tax

  • 6.2%: Social security
  • 1.45%: Medicare
  • 6%: Unemployment tax (charged on the first $7,000 an employee earns per year)

Employer Cost

  • 6.2%: Social security
  • 1.45%: Medicare

Working Hours

Work Week

Monday to Friday.

Overtime Pay & Maximum Hours

Standard working hours are 8 hours per day, 40 hours per week. The standard work week is from Monday to Friday.

Overtime payment is mandatory for certain types of work and roles at both the Federal level under The Fair Labor Standards Act (FLSA) and in certain states. Certain roles and types of work may, however, be exempt from mandatory overtime requirements. For these exempt roles. Overtime is considered included in the salary.

For non-exempt roles, hours outside of standard work hours are considered overtime. Federally, the FLSA has not established a limit on the maximum working hours. For additional hours, the minimum overtime payment rate is 150% of the average salary. This can be increased based on the employer’s discretion.

Employment Termination

All states (except Montana) fall under “employment at-will” which means employees or employers can terminate their relationship at any time. 

Employers can generally fire employees without any reason, explanation, or warning. Several states recognize exceptions to the at-will employment doctrine in cases such as:

Employment contracts — employees who’re covered by collective bargaining agreements or contracts may have protections against summary dismissal that at-will employees lack

Implied contracts — employers cannot fire employees arbitrarily if an implied contract has been agreed upon in principle, whether or not it’s documented

Good faith and fair dealing — employers cannot terminate employees to avoid paying for agreed benefits like healthcare, pensions, or commission-based work like sales

Public policy — state laws can prohibit employers from letting employees go without just cause our legal experts can help you navigate terminations to ensure employees are only let go fairly without leading to legal complications.

Notice period

Notice periods can be included in the employment contract with agreement between both parties.

Employers typically provide at least two weeks advance notice although it’s not generally not required if employees are hired on an at-will basis.

Probation periods

Probation periods in the United States usually last 60 – 90 days although employers can fix probation periods at their discretion.

These details are subject to change by the respective government and regulatory authorities in each country.

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