Do Company Policies Override Federal Law?

In the United States, federal law holds supreme status, meaning it takes precedence over state laws and company policies. However, companies have the flexibility to offer benefits and protections that exceed federal requirements. This article explores the nuances of how federal law and company policies interact, providing clarity on what companies can and cannot do.

Federal Law Cannot Be Overridden

Alexander Hamilton and other framers of the U.S. Constitution intended for federal law to be supreme. The Supremacy Clause, found in Article VI, Clause 2, asserts the primacy of the Constitution and federal statutes over state laws. This means that if a company policy conflicts with federal law, the federal law will always take precedence.

Can Companies Offer More Generous Benefits?

While a company policy cannot override federal law, it can offer benefits that go beyond what is mandated by federal statutes. For instance:

Vacation Time: Federal law does not require employers to provide vacation days. A company can choose to offer this as a benefit to its employees. Federal Holidays: If a company observes a federal holiday (like the 4th of July), it is not required to do so. However, companies can choose to offer these as paid holidays. Minimum Wage: Federal law sets a minimum wage, but companies can choose to pay a higher wage. Similarly, if a state law requires a higher minimum wage, companies must comply with the state law. Healthcare Benefits: The Affordable Care Act (ACA) requires minimum healthcare coverage. A company can choose to offer more comprehensive healthcare benefits, including family coverage. Truck Driver Hours: Federal law limits the number of hours truck drivers can operate, but companies can provide more rest and better working conditions.

Examples of Legitimate Practices

Companies have the legitimate right to:

Pay Above Minimum Wage: They can offer higher salaries or hourly wages than the federal or state minimum wage. This practice goes beyond the legal requirements but is still within the bounds of the law. Offer Overtime Pay: Federal law allows employers to not pay overtime if an employee is deemed exempt. However, companies can choose to pay overtime to ensure they exceed minimum requirements. Providing Work-Life Balance: Companies can provide more generous policies such as allowing flexible working hours, more parental leave, or additional bonuses.

What Companies Cannot Do

However, there are specific limitations on what companies can do:

Pay Less Than Minimum Wage: Companies are legally required to pay at least the federal or state minimum wage. Force Exempt Employees to Work Overtime: If an employee is exempt, companies cannot force them to work more hours than what the regulations allow. Non-exempt employees must be paid overtime as mandated by federal law. Violate Anti-Discrimination Laws: Companies cannot choose to offer benefits or advantages to a specific demographic group. For example, it would not be compliant to offer higher salaries to white male employees while ignoring other groups.

Conclusion

In summary, federal law is supreme and cannot be overridden by company policies. However, companies have the flexibility to offer benefits and protections that exceed federal requirements. The key is to ensure that company policies meet or exceed the minimum requirements set by federal and state laws.