As payroll, labor, and HR laws change across the local, state, and federal levels, navigating payroll can be a challenging endeavor for any employer. With strict guidelines and steep penalties, even the most experienced business owner can get confused and overwhelmed.
In an effort to support Georgia employers, our team of experts created this comprehensive guide on the laws, rules, and regulations all business owners must know when managing their payroll. Let’s dive in!
- State and Federal Payroll Laws
- HR Laws that Impact Payroll Management
- How We Change the Way You Manage Payroll
State and Federal Payroll Laws
As most business owners can expect, Georgia employers are expected to adhere to both state and federal guidelines when managing their payroll. In this section, we will examine these payroll laws one by one.
As of 2022, Georgia’s minimum wage is $5.15 per hour – just one of seven states to have a wage floor below the national standard. As such, Georgia employers are all but required to adhere to the federal minimum wage of $7.25 per hour.
Per state law, there are three major exceptions:
- Employees in gratuity-based industries have a minimum wage set at $2.13 per hour.
- High-school-aged and full-time college students may be paid at 85% of the minimum wage standard ($6.16/hour) for up to 20 hours of work per week for certain employers (i.e., work-study programs).
- During the first 90 days of employment, employees under the age of 20 may be paid at a training wage rate of $4.25 per hour.
As of writing, there are no Georgia municipalities with minimum wage standards above state and federal requirements. The city of Atlanta, however, did announce a minimum wage increase for city workers in 2017. As a result, city employees received a progressive pay increase, reaching $15 per hour in 2019.
As of 2022, Georgia does not have any state-level overtime regulation laws. As a result, employers must follow the regulations set forth by the federal government in the Fair Labor Standards Act (FLSA).
According to the FLSA, all non-exempt Georgia-based employees are entitled to one and one-half pay for any work performed after exceeding 40 hours in a single workweek. For example, if an employee has a base rate of $15.00/hour, then their overtime rate would be $22.50/hour.
As one can expect, there are some exceptions. Per the FLSA, the following employees may be exempt from receiving overtime rates:
- Professional, administrative, or executive employees, defined by the FLSA, Section 13(a)(1)
- Commissioned employees, defined by the FLSA, Section 7(i)
- Computer employees (i.e., programmers, engineers, systems analysts), defined by FLSA, Section 13(a)(1)
- Outside sales employees, defined by FLSA, Section 13(a)(1)
Notably, Georgia does not have state wage laws that outline specific overtime exemptions for highly compensated employees.
In Georgia, there are four approved methods by which employers may pay their employees.
The four approved methods for payment in Georgia are:
- Direct deposit (if agreed upon by employer and employee)
- Payroll card
Direct deposit may only be used as a form of payment after the employer receives authorization from the employee.
Pay Stub Laws
In the US, pay stub laws require employers to provide notices of wage information, such as total paid, hourly rate, deductions, and more. Because there are no federal requirements, however, pay stub laws are determined by each state.
In Georgia, employers are not required by law to provide employees with notices of any wage information during their employment, including standard pay stubs. As a result, Georgia business owners may disclose wage information to their employees at their own discretion.
Minimum Pay Frequency
As of 2022, there are no minimum pay frequency laws at the federal level. With that said, however, most states establish their own pay frequency laws, which employers must adhere to.
Georgia employers have a large amount of control over their own payment schedules, but still must adhere to the guidelines set by GA Statute 34-7-2.
Per state law, Georgia business owners must pay their employees at least twice per month. Employers can implement more frequent pay schedules, however. Regardless, state regulations make it clear that employers must have a consistent and defined payment schedule.
As with most regulations, there are, of course, some exceptions. In Georgia, officials, superintendents, subhead of divisions, and similar executive-level roles may be paid on less frequent basis, as stipulated by the terms of their employment. Farming, sawmill, and turpentine industry employees may also be exempt from pay frequency laws.
Paycheck Deduction Rules
A paycheck deduction is any sum removed from an employee’s paycheck – typically for benefits, taxes, damages, or losses.
In Georgia, there are no laws outlining what deductions may or may not be taken from an employee’s paycheck – or whether an employee needs to provide written consent prior to any deduction.
As a result, employers can deduct or withhold wages for a myriad of reasons, including cash shortages, damages, required tools and uniforms, benefits, and more.
Final Paycheck Laws
Final paycheck laws establish a required timeframe in which employers must pay former employees for their services. The state of Georgia does not have its own final paycheck laws, however, so employers must adhere to federal guidelines.
Under federal law, final pay is generally expected by the next typical payday. As a result, Georgia employees must receive their final paychecks by their next scheduled payday – regardless of if they were terminated or quit.
Document and Record Storage
Under the FLSA and Georgia Statute 34-4-5, Georgia employers are required to record, document, and store payroll records for each of their employees. Specifically, the following information is required to be recorded and stored:
- Employee's full name and Social Security Number
- Address, including zip code
- Birth date
- Sex and occupation
- Time and day of the week when an employee's work week begins
- Hours worked each day
- Total hours worked each workweek
- The basis on which employee's wages are paid (e.g., "$9 per hour", "$440 a week", "piecework")
- Regular hourly pay rate
- Total daily or weekly straight-time earnings
- Total overtime earnings for the workweek
- All additions to or deductions from the employee's wages
- Total wages paid each pay period, date of payment, and the pay period covered by the payment
On the state level, there are no requirements for private employers in regards to the storage of payroll records. Per the FLSA, however, private employers must maintain all records for determining wages for two years and must store all payroll records for at least three years.
HR Laws that Affect Payroll
New Hire Reporting
In 1998, a combined effort by federal and state legislators created laws that require employers to report all new and rehired employees. In Georgia, these reports are filed with the Georgia New Hire Reporting Center.
In Georgia, employers must report all newly hired and rehired employees within 10 days of their hire date. As a rule of thumb, any employee that files a Form W-4 should be reported – regardless of if they work full-time, part-time, or seasonally.
Per the Georgia New Hire Reporting Center, rehired employees are defined as "Rehired employees are employees who return to work after sixty (60) days, or more, of being laid off, furloughed, separated, or granted a leave without pay or terminated from employment. Recalled employees include anyone who remains on the payroll during a break in service or gap in pay and then returns to work. For example, teachers, substitutes, seasonal workers, etc.”
Notably, Georgia employers are not required to report independent contractors.
Requirements for Georgia New Hire Reporting
Per the Georgia New Hire Reporting Center, employers must submit the following information when reporting new hires:
- Employer's Federal Employer Identification Number (FEIN)
- Employer's company name - a name associated with the FEIN
- Employer's address - address associated with the FEIN
- Employee's Social Security number
- Employee's name (specify first, middle and last)
- Employee's home address
- Employee’s date of birth
- Date of hire (the employee's first day of work for pay)
- Employee’s medical insurance availability
- Employee’s state of hire.
Paid Time Off (PTO)
On both the federal and state level, there are no requirements for Paid Time Off. As a result, Georgia employers are not required to provide paid or unpaid vacation leave.
Still, a Georgia employer can offer paid or unpaid leave as part of their company’s policy or their employees’ contracts. Doing so may cause employers to become lawfully obligated to pay accrued vacation upon separation, however.
With that said, Georgia employers can implement contract stipulations and company policies that deny the payment of accrued PTO upon the end of employment. For example, a company may establish a policy that disqualifies former employees from receiving payment for their accrued PTO if they do not submit a two-week notice.
Similarly, Georgia business owners can also create “use-it-or-lose-it” policies, which require employees to use accrued PTO by a specific date.
Note: while the majority of vacation policies are written, unwritten agreements can still be enforced in a court of law.
Leave Laws and Regulations
Paid Sick Leave
For Georgia employers, there are not any state or federal laws that require them to provide paid sick leave to their employees. As a result, business owners are allowed to create their own paid sick leave policies for their operations.
Similar to PTO, however, if an employer promises paid sick leave then they may be legally obligated to provide it. As such, it’s best practice for employers to review their company policies and make necessary revisions regularly.
Notably, Paid Sick Leave is guaranteed for public employees in the state of Georgia. Specifically, full-time public employees that are compensated on a biweekly basis are entitled to earn up to 5 hours of paid sick leave per pay period. Similarly, full-time public employees that are compensated on a monthly basis may earn up to 10 hours of paid sick leave per pay period.
Neither federal nor state laws set guidelines for providing holiday leave. As a result, private Georgia employers are not required employees with paid or unpaid holiday leave. In fact, private employers can even require employees to work holidays.
Additionally, Georgia employers are not required to pay employees a premium rate for working holidays – traditionally, one and one-half times the employee’s standard wage rate. If an employee qualifies for overtime, however, then they still must follow state and federal payroll laws.
In the case that an employer does choose to provide paid or unpaid holiday leave, they must comply with the terms established in their company’s policy and their employee’s contract.
In Georgia, employers may not discharge, discipline, or penalize an employee for taking leave in order to attend a judicial proceeding in response to a summons for jury duty, a subpoena, or another court order – as outlined by GA Statute 34-1-3.
The state and federal government, however, does not have any laws that require employers to provide paid leave for employees away on jury duty. As a result, Georgia employers do not need to provide paid leave for any employees exercising their civic duty.
Like most states, Georgia provides employees with opportunities to leave work in order to vote in local, state, and federal elections.
Per GA Statute 21-2-404, an employee may receive up to two hours of leave to vote if:
- The employee provides reasonable notice of the need to take time off
- The polls are not open for at least two hours prior to the employee’s shift beginning or ending.
Notably, state and federal law does not require Georgia employers to pay employees during their voting leave. Additionally, in order to minimize disruption, an employer may determine the hours that an employee may be absent to vote.
Child Labor Laws
Passed on the state and federal levels, child labor laws protect minor’s from exploitation of their labor and unsafe working conditions.
In Georgia, all minors below the age of 18 must have a work permit – also known as an employment certificate. Age certification is not required for minors under the age of 18, but employers are expected to provide it upon request.
Minors under the age of 16, however, are not allowed to work during school hours unless they have graduated from high school. Minors that are excused from school attendance by their school’s board of education may be exempt from this rule, assuming they meet the regulations and policies set forth by the state’s Board of Education.
As one can expect, the state sets working hour restrictions that limit how much a minor can work in a day and week. Under these guidelines, minors under the age of 16 may only work a maximum of 4 hours per day on school days. When school is out, they may work up to 8 hours per day, 40 hours per week. Additionally, minors under the age of 16 are prohibited from working between 9pm and 6am.
Notably, minors 16 years and older have no work restrictions.
Interestingly enough, minors working in the agricultural industry are also exempt from state labor laws. In Georgia, minors under the age of 18 working in the agricultural industry do not need an employment certificate and do not have set limits on work hours or night work.
Lunch and Other Break Time Requirements
Neither Georgia law nor the Fair Labor Standards Act (FLSA) requires employers to provide breaks or meal periods for their employees.
Still, many Georgia employers do provide breaks and meal periods for their employees.
Notably, the FLSA does require workers to be paid for short break periods. However, if such breaks exceed thirty minutes, then Georgia employers do not need to provide compensation.
Navigate Payroll Laws and Regulations
Even for the most experienced employers, Georgia payroll laws can feel like an endless stream of confusing instructions and difficult-to-read regulations.
Luckily, we provide a comprehensive service that simplifies the payroll process and ensures local, state, and federal compliance. Our expert Payroll Guides will provide unmatched guidance for all your Human Capital Management needs – including payroll management, tax credit acquisition, and more.
Additionally, our flagship software solution allows employers to expedite everything from their payroll to HR to talent acquisition.
To learn more about our Payroll Solutions and related tax services, click here.