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By Sanjeev Kumar
Founding Attorney

What employment laws should I be aware of as a small business owner in Texas?

Small business owners in Texas face numerous challenges.  In addition to attracting customers, fine-tuning their product, and driving profits, small business owners need to make sure they abide by several important federal and state laws.  Employee laws impact what employees must be paid, how long they can work, and much more.  Our Austin, Texas business law attorney at The Kumar Law Firm PLLC offers a look at four laws that every business owner should understand. 

  1. Wage Laws 

    Wage laws are intended to protect employees from underpayment.  Failure to comply with federal wages laws can result in serious penalties.  The federal minimum wage is currently set at $7.25 for non-tipped employees. While some states impose wage minimums higher than the federal level, Texas has currently adopted the federal minimum.  Under the U.S. Fair Labor Standards Act (FLSA), your business must comply with federal minimums if you do over $500,000 or more in sales or are engaged in interstate commerce.  Most businesses today will fall under this umbrella, and those that do not will still need to comply with state wage laws.

  2. Meal and Rest Breaks

    Texas law does not require employers provide employees with a lunch break.  Employers can choose whether to give their employees meal or rest breaks.  Federal law similarly does not require meal or rest breaks, but does state that employers must pay employees for breaks of under 20 minutes. Bona fide meal breaks of over 30 minutes do not have to be paid.

  3. Classifying Employees

    It is critical that your employees be classified correctly.  Employees that are on salary and hold authority may be exempt from overtime requirements if they make over $455 per week.  Independent contractors are also exempt from overtime, but it is essential that the employee is properly classified.  To be an independent contractor, the employee must create their own hours, work on their time, and be responsible for their own gains.  Misclassifying employees can result in fines and back pay.

  4. Leave of Absence 

    Leaves of absence can be difficult to navigate for employers.  The Family Medical Leave Act (FMLA) requires employers to give employees up to 12 weeks of unpaid leave for certain circumstances, including giving birth, adopting, and caring for an ill family member.  Your business law attorney will assist you in assessing an employee’s eligibility for leave and what your legal requirements are as an employer with an employee on leave.


About the Author
Sanjeev Kumar is the founder and principal at the Kumar Law Firm, which provides a wide range of legal services to entrepreneurs and business owners in the area of business & corporate law and intellectual property along with related areas of interest to clients such as business succession planning, wealth preservation through estate planning, and alternate dispute resolution.