With new laws for employee privacy rights, hiring practices, tax dodging and even disability accommodations changing from one year to the next, it can be helpful to have an overarching framework to sort through these different regulations.
Labor, Employment and Business Law
The most accessible way of thinking about the smorgasbord of all of these laws is by breaking them off into three areas: labor law, employment law and business law.
Labor law in many respects is the most specific general domain of law. Labor law relates to laws linking labor unions, employees and employers.
On the macro level, the National Labor Relations Act is probably the most important piece of legislation that lynchpins all of the laws that dictate an employee’s right to collectively organize into trade unions.
Rules governing collective bargaining, higher wages and better working conditions, and joint action like labor strikes are all protected under the National Labor Relations Act, which is perhaps the centerpiece of labor law in the United States today.
Employment law is definitely broader in scope than labor law. Employment law covers legislation and regulations underlying the relationship between the employer and employee in the workplace
The only exception to this definition is that any legislation or regulation underlying the employer/employee relationship that is related to trade unions or collective bargaining should probably be classed under labor law.
Employment law encompasses broad legal practices like minimum wage, Title VII under the Civil Rights Act (barring workplace discrimination), and especially legislation that followed from the Fair Labor Standards Act.
The Fair Labor Standards Act is a federal piece of legislation that sets the forty-hour workweek and federal minimum wage, bans child labor, and grants time and a half overtime payment. Many of the federal mandates telling employers what they can and can’t do fall under the umbrella of employment law.
Business law, or commercial law, is more narrowly focused on the relationship between private citizens and businesses as that relationship relates to trade, transactions, and general commerce.
The field of business law also covers the principal/agent relationship and issues of corporate contracts and commercial insurance. In short, the principal/client relationship refers to a contract between, say, a private citizen (client) and hedge fund manager (principal) who acts on that private citizen’s behalf to make investments.
Business or commercial law is regulated both federally and statewide. Through Congress’ ability to regulate interstate commerce and control food laws and occupational safety mandates, the federal government holds sway over many business practices encompassed under business law.
On a statewide scale, the police and certain regulatory bodies enforce federal laws such as the Occupational Safety and Health Act.
Reviewing the Differences
When parsing the differences between these overarching areas of law, it’s important to bear in mind that labor law is more specialized than either business law or employment law.
Labor law covers legislation that links together the employer, employee and labor unions. Therefore, collective bargaining and pieces of federal legislation like the National Labor Relations Act should be classified under labor law.
Employment law is one level more broad than labor law since employment law covers all legislation that underlies the employer/employee relationship in the workplace. Workplace discrimination laws like Title VII under the Civil Rights Act – which bars workplace discrimination related to religion, gender or race – would fall under employment law.
Business law covers the relationship between one business and another or a private citizen and a business. Business law, or commercial law, is federal and statewide in scope and includes any legislation that regulates business transactions and commerce.
For a local business and employment attorney, check out The Law Office of Scott R. Dallas.