North Carolina Labor Laws Guide

North Carolina wage laws

North Carolina employees are subject to federal provisions concerning wages.

The following are the regulations concerning:

• The state minimum wage,
• The tipped hourly wage, and
• The subminimum wage in North Carolina.

North Carolina minimum wage

The state minimum wage in North Carolina equals the federal minimum wage of $7.25 per hour.

Exceptions to the minimum wage in North Carolina

The Federal Fair Labor Standards Act (FLSA) has declared certain occupations exempt from the minimum wage law. They include:

• Bona fide executives, administrative workers, learned and creative professionals who are paid on a salary basis and earn not less than $684 per week
• Computer employees who earn $684 per week or at least $27.63 per hour
• Highly compensated employees who earn $107,432 or more a year
• Outside sales employees
• Minors
• Tipped employees*

Tipped minimum wage in North Carolina

In North Carolina, a tipped employee is an employee who earns more than $20 in tips per month.

As far as the minimum wage for tipped employees is concerned, they are entitled to the federal compensation of $2.13 per hour.

Even though an employer may pay a tipped employee as little as $2.13 an hour, the tipped employee‘s total earnings per hour must equal the federal minimum of $7.25. The employer is the one who is obliged to make up the difference.

North Carolina subminimum wage

When it comes to youth wages, North Carolina once again adopts the federal minimum wage requirements.

Under FLSA, employees under 20 years of age must be paid not less than $4.25 per hour during the first 90 days of employment.

When such a period expires or when a worker turns 20 — the minimum wage of $7.25 takes effect.

Furthermore, full-time students may be paid 85% of the minimum wage under federal law.

North Carolina payment law

Employers in North Carolina have the freedom to choose how frequently they want to run payroll. On that account, they can opt for 5 payroll frequencies:

• Daily — Employees are paid each day
• Weekly — Employees are paid once a week (52 paychecks per year)
• Biweekly — Employees are paid every other week (26 paychecks per year)
• Semi-monthly — Employees are paid twice a month (24 paychecks per year)
• Monthly — Employees are paid once a month (12 paychecks per year)

Meanwhile, bonus or commission-based employees in North Carolina may receive their paychecks as infrequently as once a year.

North Carolina overtime laws

By federal law, eligible employees who work more than 40 hours per week qualify for overtime pay at a rate of one and one-half (1.5) times the regular rate of pay.

In addition, federal law doesn’t require overtime pay for working on the weekends, holidays, or any other day of rest.

Overtime exceptions and exemptions in North Carolina

However, certain employees and occupations are exempt from overtime pay under federal law:

• Bona fide executives, administrative employees, learned, and creative professionals who earn a salary and make not less than $684 per week
• Computer employees who earn $684 per week or at least $27.63 per hour
• Highly compensated employees who make more than $107,432 a year
• Outside sales employees

Fluctuating Workweek Method (FWW) in North Carolina

Although most salaried workers are exempt from overtime pay, the Fluctuating Workweek Method (FWW) qualifies some salaried employees for overtime pay of one-half (0.5) times their regular hourly rate.

Who is eligible for FWW?

• Employees who receive a fixed salary
• Employees whose work hours fluctuate from week to week (sometimes they work more or less than 40 hours a week)
• Employees who earn at least $7.25 per hour

How to calculate FWW overtime pay

Let’s say an employee’s weekly income is $700, and in the preceding week, the employee worked 50 hours.

To be able to calculate FWW overtime hours, you need to calculate the hourly rate first.

Simply divide the weekly salary by the number of hours worked for that week.

$700 / 50 = $14 per hour

Next, multiply the hourly rate by 0.5 for every overtime hour during the week.

$14 per hour x 0.5 = $7 for each overtime hour worked

Total overtime compensation goes as follows:

$7 x 10 overtime hours = $70

North Carolina break laws

Neither the North Carolina Wage and Hour Act nor the federal Fair Labor Standards Act (FLSA) require an employer to provide employees 16 years of age or older with rest or meal breaks.

Exceptions to break laws in North Carolina

When provided, breaks lasting more than 20 minutes are not compensable unless employees are required to work during break time — telephone operators, for instance.

Moreover, employers in North Carolina are not required to provide a breakroom or a smoke break with a separate smoking room within the area.

North Carolina breastfeeding laws

Even though mothers in North Carolina have the right to breastfeed in public, there is no state law concerning breastfeeding in the workplace.

Therefore, under federal law, non-exempt employees are entitled to “reasonable break time to express breast milk” for one year after the child’s birth.

Moreover, employers must provide a separate room — other than a bathroom — that can be used solely for breastfeeding.

North Carolina leave requirements

In the state of North Carolina, there are two types of leave days:

• Required leave
• Non-required leave

North Carolina required leave

The state of North Carolina allows its workers to maintain a healthy work-life balance by offering them desirable time-off benefits.

Leaves of absence that employers are obliged by law to provide their employees in North Carolina include:

• Holiday leave (public employers)
• Sick leave
• Vacation leave (public employers)
• Family and Medical Leave
• Family Illness Leave
• Paid Parental Leave
• Voluntary Shared Leave
• Community Service Leave
• Military Leave
• Civil Leave
• Blood, bone marrow, and organ donorship leave
• American Red Cross Disaster Service Leave

Holiday leave (public employers)

State employees are assigned 12 paid holidays a year.

Those who are required to work on holidays receive holiday premium pay equal to one-half (0.5) of their regular hourly rate (plus their regular salary).

The following is a holiday schedule with the observance dates for the year 2022:

Sick leave

Employees who are eligible for sick leave in North Carolina are:

• Full-time permanent, probationary, and time-limited employees who earn sick leave at the rate of 8 hours per month (96 hours a year)
• Part-time (half-time or more) permanent, probationary, and time-limited employees who earn sick leave at a prorated amount (only for scheduled work time)

Sick leave may be used for:

• Illness or injury
• Doctor appointments
• Childbirth
• Care for an immediate family member*
• Death in family
• Donations to an immediate family member
• Child adoption (30 days for each parent)

* Immediate family members include a spouse, parent, child, sibling, grand, or great parent/child.

Vacation leave (public employers)

Full-time permanent, probationary, and time-limited employees have the right to vacation leave which depends on their length of total state service.

The following is a table showing leave credits that North Carolina employees may receive:

Part-time employees who work half-time and more are also eligible for vacation leave but at a prorated rate.

Family and Medical Leave Act (FMLA)

The Family and Medical Leave Act (FMLA) is a federal law that offers eligible employees unpaid job-protected leave of up to 12 weeks in any 12-month period.

When to use the FMLA

Eligible reasons for using family or medical leave include:

• Birth and care of a newborn child
• Adopting or taking in a foster child
• Taking care of an ill family member (child, spouse, or parent)
• Employee’s own illness

Who can use the FMLA?

• Full-time employees — Permanent, probationary, or time-limited employees who have 12 months of continuous service,
• Part-time employees (half-time or more) — Permanent, probationary, or time-limited employees who have been in pay status at least 1,040 hours in the last year, and
• Temporary, intermittent, or part-time (less than half-time) — Employees who have 12 months of service and have been in pay status at least 1,250 hours in the last year.

Family Illness Leave

When the FMLA benefit is exhausted, the Family Illness Leave comes into force. Therefore, eligible employees have the right to 52 weeks of unpaid leave during a 5-year period.

The Family Illness Leave can be taken to take care of an immediate family member (child, parent, or spouse) and cannot be used for the employee’s own illness.

Who can use the Family Illness Leave?

• Full-time or part-time (half-time or more) permanent, probationary, or time-limited employees
• Said employees who have 12 months of state service
• Said employees who have been in pay status 1,040 hours in the previous 12 months

Paid Parental Leave

The Paid Parental Leave benefit gives new parents (by birth, adoption, or foster care) 4 to 8 weeks of paid leave to recover or bond with the newborn.

The leave is compensated at 100% of the employee’s regular pay.

Voluntary Shared Leave

In case an eligible employee or the employee’s immediate family member has a prolonged medical condition, they may receive an additional 1,040 to 2,080 hours of shared leave.

State employees may donate their leave only in the case when they have sufficient leave balances.

They may donate their vacation/bonus or sick leave to another immediate family member or a non-family member as well.

Community Service Leave

This type of leave is intended for state employees who wish to volunteer in schools, communities, non-profit organizations, etc.

Below, you can see different types of employees and the leave benefits they are entitled to:

When to use Community Service Leave

• To attend school events where the employee’s child is participating (only for academic or artistic programs — athletic events are not included)
• To perform volunteer service at schools, public universities, community colleges, state agencies, or community service organizations
• To participate in fund-raising events as a volunteer (e.g., serving food at an event, handling parking, etc.)
• To assist voters with the voting process (without receiving any compensation)
• To volunteer in soup kitchens, homeless shelters, etc.

Military leave

North Carolina state employees are granted different types of military leave for the following:

• Active duty training and inactive duty training — Members of the uniformed services receive paid leave of up to 120 hours each federal fiscal year (October to September).
• Physical examination — Members of the uniformed services are entitled to paid leave for physical examination.
• Reserve active duty — Military members or the Intermittent Disaster Response Appointees (IDRAs) may receive up to 30 calendar days of pay. After the thirty-day period, members continue to receive the difference between military pay and employee’s annual salary.
• Extended active duty and other military leave without pay — This refers to all uniformed service duty that is not covered by military leave with pay, such as hospitalization during active duty, drills, extended active duty, and others.
• Civil air patrol and State Defense Militia — U.S. Air Force members get unpaid leave of 120 hours in a calendar year, while the State Defense Militia members are entitled to paid military leave of up to 120 hours a year.

Civil leave

In North Carolina, there are:

• Non-job related civil leave — Full-time or part-time (half-time or more) permanent, probationary, or time-limited employees are eligible for non-job-related civil leave.
• Job-related civil leave — Together with eligible employees said above, employees with a temporary, intermittent, or part-time (less than half-time) are also included.

However, there are differences between jury duty and court attendance responsibilities and leave options.

Non-job-related civil leave is available to full-time, part-time (half time or more), permanent, probationary, or time-limited employees.

When serving on a jury, said employees receive:

• Paid leave,
• Compensation, and
• Fees received for jury duty.

When appearing as a witness, eligible employees may choose between:

Together with eligible employees said above, employees with a temporary, intermittent or part-time (less than half-time) are also eligible for job-related civil leave.

When attending court in connection with official duties, eligible employees:

• Receive no leave, and
• Must turn witness fees into the agency.

Blood, bone marrow, and organ donorship leave

North Carolina employees are encouraged to participate in donorship programs by getting reasonable paid time off for the following:

• Blood donation
• Pheresis procedure
• Bone marrow transplant

Moreover, organ donors may receive up to 30 days of paid leave.

American Red Cross Disaster Service Leave

Disaster service volunteers of the American Red Cross can be granted up to 15 workdays in a 12-month period with pay.

North Carolina non-required leave

The following leave benefits are not required by North Carolina law — but are at the discretion of each employer.

The types of North Carolina non-required leaves include the following:

• Holiday leave (private employers)
• Vacation leave (private employers)
• Bereavement leave
• Voting leave

Holiday leave (private employers)

Unlike state employees, private employees are not entitled to time off on holidays under federal or state law in North Carolina.

Vacation leave (private employers)

Just like with holiday leave — private employers are not obligated to provide employees with vacation leave — whether paid or unpaid.

Bereavement leave

Such leave is taken following the death of an immediate family member, close friend, relative, and similar.

However, employers in North Carolina are not required to provide employees with time off in those circumstances.

Voting leave

Again, employees in North Carolina don’t receive leaves of absence for the purpose of voting.

Child labor laws in North Carolina

To make sure minors work in a healthy and hazard-free environment — employers in North Carolina must comply with the federal provisions regarding child labor.

Those provisions include:

• Work time restrictions
• Breaks for minors
• Prohibited occupations for minors

Work time restrictions for North Carolina minors

When it comes to work hour regulations for minors in North Carolina — federal laws apply.

Minors aged 13 and less are not permitted to work under federal law, except when:

• Working for parents,
• Delivering newspapers, or
• Working in the entertainment industry.

The following are hour restrictions concerning 14- and 15-year-olds:

• May work no more than 3 hours a day on a school day
• May work no more than 8 hours a day on a non-school day
• May work a maximum of 18 hours per week when school is in session
• May work a maximum of 40 hours per week when school is not in session
• May work between 7 a.m. and 7 p.m. (except from June 1 through Labor Day when they can work until 9 p.m. on a non-school day)

Under federal law, there are no time restrictions for minors aged 16 and 17.

Still, North Carolina law proposes that minors enrolled in grades 12 or lower can’t work between 11 p.m. and 5 a.m. preceding a school day — unless they have written permission from the parents and principal.

Breaks for North Carolina minors

Following federal provisions, minors must get a 30-minute break after every 5 consecutive hours of work.

Prohibited occupations for North Carolina minors

North Carolina law prohibits youth under the age of 18 to work in any of the following occupations:

• Welding, brazing, and torch cutting
• Working with silicon dioxide, quartz, or asbestos
• Any work involving exposure to lead, benzene, or their compounds
• Working in canneries, seafood, or poultry industries
• Any work involving the risk of falling a distance of 10 feet and more
• Working as an electrician or electrician’s helper
• Any work in confined spaces
• Any work requiring the use of respirators

In addition to the North Carolina hazardous and detrimental occupations prohibited to minors under 18 years of age, the federal provisions regarding prohibited occupations also apply.

Even though the FLSA forbids employees younger than 18 from driving a motor vehicle — the North Carolina Wage and Hour Act (WHA) allows 16- and 17-year-olds to drive a motor vehicle for business purposes.

Minors aged 16 and 17 may drive a motor vehicle to perform job-related duties provided that:

• The driving is done within a 25-mile radius of the business, and
• That they don’t use public roads and highways.

Moreover, minors aged 14 to 17 may work in a workroom with tanning beds — provided that the tanning beds are not operating at that time.

North Carolina hiring laws

North Carolina employers who employ more than 15 or more workers must provide equal opportunity to all persons seeking employment.

Under federal and state laws, employment practices in North Carolina mustn’t be based on:

• Race
• Color
• National origin
• Religion*
• Sex*
• Age*
• Disability**
• Genetic information
• Political affiliation

* It is lawful to employ an individual based on their religion, sex, or age when such qualifications are bona fide occupational requirements — i.e. necessary for a certain business or job position.

** This applies to any physical or mental impairment.

Yet, North Carolina veterans are given preference in employment as a way of showing appreciation for their service to the State.

Said employment practices include, but are not limited to the following:

• Recruitment process
• Wage determination
• Promotion
• Work evaluation
• Termination of employment

Right to work law in North Carolina

North Carolina is one of the many “right-to-work” states. This means that employees have the freedom to decide whether or not to join a labor union.

By the North Carolina right-to-work law, the following applies:

• An employee can’t be forced to become or remain a member of any labor union or organization as a condition of employment
• An employer can’t require an employee to abstain or refrain from membership in any labor union or organization as a condition of employment
• An employee can’t be forced to pay any dues, fees, or other charges to a labor union or organization as a condition of employment

If a person does suffer any employment discrimination damages due to their membership or nonmembership in a labor union or organization, that person may start a court proceeding of this State.

North Carolina termination laws

North Carolina is an employment-at-will state. This means that an employer may terminate an employee at any time and for any reason at all.

However, it is illegal for an employer to terminate an employee on the basis of:

• Age
• Sex
• Religion
• Color
• Disability
• Pregnancy

Also, an employer mustn’t take any adverse action against an employee who reports any violation, makes a complaint, files a charge of discrimination, and similar.

Finally, an employee may also resign from a job penalty- and losses-free at any time and for no reason at all.

North Carolina final paycheck

Whether an employee resigns from a job or gets terminated — the employer is responsible for paying all wages due on or before the next payday.

Health benefits continuation in North Carolina

North Carolina applies both federal and state laws concerning health insurance coverage for terminated employees.

Pursuant to the State Continuation law of North Carolina, any employee who has been terminated from a job — whether voluntarily or involuntarily — has the right to continue their health insurance for up to 18 months. In addition, their dependents are also eligible for the same health continuation benefits.

The benefits that the North Carolina State Continuation law offers are the following:

• Hospital benefits
• Surgical benefits
• Major medical benefits

However, the State Continuation law doesn’t cover dental, vision care, and prescription drug benefits.

At the same time, the federal Continuation of Health Coverage (COBRA) is also applicable in North Carolina. Still, it only covers employees who work in businesses with more than 20 employees.

Eligible employees and their dependents may continue their health benefits for up to 18 months.

Occupational safety in North Carolina

North Carolina has its own State Plan that deals with safety in the workplace.

Even though the North Carolina State Plan is approved by the federal Occupational Safety and Health Administration (OSHA) — federal OSHA still has the power to monitor the State Plan.

The division that deals with occupational safety and health is called the North Carolina Occupational Safety and Health (NC OSH), and it covers only private sectors (with some exceptions such as contract workers, railroad employment, maritime employment, etc).

Therefore, federal OSHA covers the issues not covered by the State Plan.

Apart from following all OSHA standards — the NC OSH Division has some distinctive standards of its own regarding the following:

• Hazardous Waste Operations and Emergency Response
• Communication Towers
• Electric Power Generation, Transmission, and Distribution
• Steel Erection
• Personal Protective Equipment and Life-Saving Equipment
• Bloodborne Pathogens
• Communication Towers
• Blasting and Use of Explosives
• Non-Ionizing Radiation
• Field Sanitation

Moreover, the North Carolina State Plane offers on-site consultations and organizes regular programs focused on reducing injuries and fatalities in the workplace.

Miscellaneous North Carolina labor laws

Last but not least, we’ll cover some of the miscellaneous labor laws concerning North Carolina.

These include the following:

• Whistleblower laws
• Recordkeeping laws

North Carolina whistleblower law

As far as the whistleblower law in North Carolina is concerned, the North Carolina False Claims Act protects any individual who files a lawsuit against a person who:

• Knowingly presents a false or fraudulent claim for compensation
• Knowingly uses a false record or statement material to a false or fraudulent claim
• Knowingly uses a false record to pay or transmit money or property to the State
• Knowingly avoids or decreases the amount that needs to be paid to the State

Any person who commits any of the said acts will be liable to the State for:

• Three times the actual amount
• Costs of a civil action
• Civil penalties ranging from $5,500 to $11,000 for each violation

At the same time, the whistleblower who reports any of the said violations may receive 15% to 25% of the settlement of the claim if the State decides to process the claim.

In case the State doesn’t decide to intervene, the whistleblower may proceed with an action on their own and receive between 25% and 30% of the amount recovered.

Moreover, any whistleblower who suffers any adverse employment action (discharging, suspending, harassing, etc.) due to their whistleblowing is entitled to:

• Be placed back into their former job position
• Two times the amount of back pay plus the interest
• Compensation for any damages suffered due to discrimination including attorney fees and litigation costs

For a whistleblower to qualify for protection and compensation, a complaint must be filed within 6 years of the alleged violation.

North Carolina recordkeeping laws

Each department, agency, institution, commission, and bureau in North Carolina is responsible for maintaining the following employee records for a minimum of 5 years:

• Name
• Age
• Date of employment
• Contract terms
• Current position and title
• Salary
• Date and amount of each increase or decrease in salary
• Date and type of each promotion, demotion, dismissal, transfer, suspension, separation, or any other change in position
• Currently assigned office or station of the employee

Any person who wishes to inspect, examine, or copy any of the said records is allowed to do so during business hours.

Finally, these provisions also apply to all employers with minor employees under 18 years of age.

Conclusion/Disclaimer

We hope this North Carolina labor law guide has been helpful. We advise you to make sure you’ve paid attention to the links we’ve provided, as most of them will lead you to the official government websites and other relevant information.

Please note that this guide was written in Q2 2022, so any changes in the labor laws that were included later than that may not be included in this North Carolina labor laws guide.

We strongly advise you to consult with the appropriate institutions and/or certified representatives before acting on any legal matters.

Clockify is not responsible for any losses or risks incurred, should this guide be used without further guidance from legal or tax advisors.

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