As an employer, you're required to provide certain benefits for your employees. There can be both state and federal rules with which you must comply, and the terms of those rules can vary. In general, the three types of benefits you must provide involve:

• giving employees time off from work
• participating in a workers’ compensation program
• withholding FICA and FUTA taxes, thus providing minimal retirement and long-term disability benefits

In a few states, employers must also provide short-term disability or health benefits.

Time Off

• Time off to vote. A majority of the states require employers to give employees time off to vote.
• Jury duty. Employees have the right to take leaves of absence to serve as jurors in federal courts, under the Jury Systems Improvement Act. Many states also require leave for employees to serve on state and local court juries.
• Appearing as a witness. Several jurisdictions have laws that may require employers to provide employees with time off to serve as a witness. These are: California, Colorado, Connecticut, District of Columbia, Florida, Illinois, Indiana, Iowa, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New York, Ohio, Oregon, Pennsylvania, Puerto Rico, Rhode Island, Vermont, Virginia, and Washington.
• Military service. You must grant permanent employees time off if they are called to active duty, although the leave may be without pay. In addition to active duty leave, you must grant annual leave to attend reserve or National Guard encampment, maneuvers, drills, training, or any other duty of a short-term nature. Some states impose additional requirements.
• Family leave. If you have 50 or more employees, you must provide family leave under the federal Family and Medical Leave Act. Employees must be permitted to take the equivalent of 12 weeks of unpaid leave each year under these circumstances:
  • the birth or adoption of a child
  • to attend to the serious health condition of an immediate family member
  • to attend to the employee’s own serious health condition

In addition to the requirements of the FMLA, several states require employers with fewer than 50 employees to provide family leave.

• Pregnancy/parental leave. If you have 15 or more employees, you're subject to the federal Pregnancy Discrimination Act (part of Title VII of the Civil Rights Act of 1964).
• Religious holidays. There are no state or federal laws that require you to give employees time off to observe religious holidays. However, antidiscrimination laws that prohibit discrimination based on religion mean that you must accommodate the religious needs of employees, if you can do so without undue hardship to your business.

Workers’ Compensation. Every state has enacted workers’ compensation laws to protect employees against loss of income and to make medical payments required due to a work-related injury, accident, illness, or disease. In every state except Texas, workers’ compensation coverage is mandatory.

FICA. The Federal Insurance Contributions Act (FICA) requires you to pay the employer’s portion of both a Social Security tax and also a Medicare tax. The law requires you to withhold the employee’s portion of these taxes from each employee’s wages.

FUTA. The Federal Unemployment Tax Act (FUTA) requires you to pay federal unemployment tax when you have employees. States also have unemployment taxes. The rules in every state are at least as broad in scope as the federal rules so, if you're paying FUTA, you'll also be paying state unemployment taxes.

Social Security Benefits. The Social Security Administration also provides benefits to workers whose disability is of a type that will last at least 12 months. Fortunately, arranging for these benefits is something that a disabled employee will handle directly with the SSA.

State Disability Programs. California, Hawaii, New Jersey, New York, Rhode Island, and Puerto Rico all have state disability programs. These jurisdictions require anyone with at least one employee to offer temporary disability benefits to an employee who is unable to work due to illness or injury, but who does not qualify for unemployment benefits or workers’ compensation.

Health Care Benefits. Hawaii is the only state that requires employers to make health benefits available to employees.

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