8.2 South Carolina Employment Laws, I-9 & Workplace Standards

South Carolina Payment of Wages Act (S.C. Code Ann. Title 41, Chapter 10)

In addition to federal FLSA requirements, commercial contractors operating in South Carolina are governed by state-specific wage and labor standards enforced by the South Carolina Department of Labor, Licensing and Regulation (SC LLR) under the South Carolina Payment of Wages Act (S.C. Code Ann. § 41-10-10 through § 41-10-110).

Mandatory Written Notice of Wages Upon Hire (§ 41-10-30)

South Carolina law imposes strict affirmative disclosure requirements on every employer at the inception of the employment relationship:

• Written Disclosure at Time of Hiring: Every employer must notify each employee in writing, at the time of hiring, of:
  1. The normal hours of work agreed upon;
  2. The wages agreed upon (whether hourly, weekly salary, piece rate, or commission);
  3. The time and place of payment (e.g., every Friday on the jobsite, or biweekly via direct deposit);
  4. The specific deductions that will be made from the employee's gross wages.

The 7-Day Advance Written Notice Rule for Wage Reductions

One of the most heavily tested statutes on the South Carolina Business Management & Law examination is the requirement for changing wage terms:

S.C. Code Ann. § 41-10-30(A) — Written Notice of Changes: The employer's written notice covers normal hours, wages, time and place of payment, and deductions. Any change in those items must be made in writing at least seven calendar days before it takes effect. A pay cut is the most commonly tested example.

• Prohibition on Retroactive Reductions: A contractor cannot reduce an employee's wage rate retroactively. For example, if a carpenter works 40 hours during a week at their agreed $25.00/hour rate, the employer cannot decide on Friday afternoon to pay $18.00/hour due to poor jobsite performance. The employer must provide 7 days advance written notice before any wage reduction can lawfully take effect.

Statutory Rules on Wage Deductions (§ 41-10-40)

An employer is strictly prohibited from withholding or diverting any portion of an employee's wages unless:

1. The employer is required or empowered to do so by state or federal law (e.g., FICA withholding, federal and state income tax withholding, or court-ordered child support garnishments); OR
2. The employer has obtained written authorization from the employee that is signed and dated prior to the deduction.

Common construction scenarios involving unauthorized deductions:

• Damaged Tools or Equipment: A contractor cannot deduct the cost of a damaged circular saw, bent scaffold frame, or broken hydraulic hose from a worker's paycheck unless the worker executed a clear, specific written authorization agreeing to that specific deduction under lawful terms.
• Cash Register or Inventory Shortages: Deductions for jobsite material shortages or vehicle damage cannot be unilaterally assessed against an employee's wages.

Payment of Wages to Separated Employees (§ 41-10-50)

When an employee is discharged, laid off, suspended, or voluntarily resigns, South Carolina establishes strict deadlines for the disbursement of final wages:

Statutory Final Wage Payment Deadlines:

• Standard Separation Deadline: All wages due to the separated employee must be paid within 48 hours of the time of separation, OR on the next regular scheduled payday;
• Absolute Maximum Limit: In no circumstance may the final payment date exceed 30 days from the date of separation.

• Payment Method: Final payment may be made by normal payroll check, authorized direct deposit, or cash with an executed written receipt. Withholding final wages to force an ex-employee to return uniforms, ID badges, or company tools is unlawful unless backed by an explicit, pre-existing written agreement satisfying § 41-10-40.

Enforcement, Treble Damages, and Attorney's Fees (§ 41-10-80)

South Carolina enforces wage compliance with substantial statutory civil penalties:

• Treble Damages: An employee who is not paid wages due may sue and recover up to three times the full amount of unpaid wages, plus costs and reasonable attorney's fees as the court allows (§ 41-10-80(C)). Courts may decline treble damages when there was a bona fide dispute over the wages.
• Administrative Citations: SC LLR may assess administrative fines up to $100 for each violation of notice or recordkeeping mandates.

South Carolina Right to Work Act (S.C. Code Ann. Title 41, Chapter 7)

South Carolina is a constitutionally and statutorily protected Right to Work state under S.C. Code Ann. § 41-7-10 through § 41-7-90.

Core Statutory Principles

Under S.C. Code Ann. § 41-7-10, the right of persons to work shall not be denied or abridged on account of membership or non-membership in any labor organization or union.

Key provisions governing commercial contracting jobsites:

• Ban on Closed Shops: An agreement between an employer and a labor union requiring an individual to be a union member prior to being hired is illegal.
• Ban on Union Shops: An agreement requiring an employee to join a labor union within a specified period (e.g., 30 days after hire) as a condition of continued employment is unlawful.
• Ban on Agency Shops & Fair Share Fees: An agreement requiring non-union employees to pay representation fees, service fees, or "fair share" assessments to a union as a condition of employment is strictly prohibited.
• Voluntary Dues Check-Off (§ 41-7-40): An employer cannot deduct union dues, initiation fees, or assessments from an employee's wages unless the employer has received an individual, voluntary, written authorization from the employee that is revocable at will.
• Penalties for Violation: Violations of South Carolina's Right to Work laws are classified as criminal misdemeanors punishable by fines and imprisonment, alongside civil liability for actual and punitive damages.

South Carolina Illegal Immigration Reform Act (S.C. Code Ann. Title 41, Chapter 8)

South Carolina regulates work authorization at the state level through the South Carolina Illegal Immigration Reform Act (S.C. Code Ann. § 41-8-10 et seq.). The Director of LLR enforces it.

Mandatory E-Verify for Every Private Employer (§ 41-8-20)

• Every private employer in South Carolina holds an imputed "South Carolina employment license" that lets it employ people. The employer may not employ anyone unless that license and its other applicable licenses, which can include a contractor license, are in effect.
• Every private employer required to complete federal Form I-9 must register with and use E-Verify to verify the work authorization of every new employee within three business days after hiring. Since the 2011 amendments took effect, there has been no driver's-license alternative.
• New employees work provisionally until verified. The employer must submit the new employee's information even if employment ends within three business days. If E-Verify does not confirm authorization, the employer may not employ, continue to employ, or rehire that person.
• Contractors must keep the contact phone numbers of all subcontractors and sub-subcontractors working for them, and provide them to the Director within 72 hours of a request during an audit or investigation (§ 41-8-20(F)).
• It is a separate, more serious violation to knowingly or intentionally employ an unauthorized alien (§ 41-8-30).

Penalties (§ 41-8-50)

+------------------------------------------------------------------------------------------------+
|              SC ILLEGAL IMMIGRATION REFORM ACT — LICENSE PENALTIES (§ 41-8-50)                  |
+-------------------------------+----------------------------------------------------------------+
| E-VERIFY VIOLATION (§ 41-8-20)| First occurrence: immediate compliance and ONE-YEAR PROBATION   |
|                               | with quarterly compliance reports to the Director.             |
|                               | Later occurrence: licenses SUSPENDED 10 to 30 days (treated as |
|                               | a first occurrence if none in the previous three years).       |
+-------------------------------+----------------------------------------------------------------+
| KNOWINGLY EMPLOYING AN        | First occurrence: licenses SUSPENDED 10 to 30 days.            |
| UNAUTHORIZED ALIEN            | Second occurrence: licenses SUSPENDED 30 to 60 days.           |
| (§ 41-8-30)                   | Third occurrence: licenses REVOKED; after 90 days the employer  |
|                               | may petition for a provisional license with 3-year probation.  |
+-------------------------------+----------------------------------------------------------------+
| DURING ANY SUSPENSION         | The employer may not do business or employ anyone; operating   |
|                               | during suspension means revocation for five years.             |
+-------------------------------+----------------------------------------------------------------+

Reinstatement after suspension requires proof that the unauthorized alien was terminated and a reinstatement fee of up to $1,000. Each failure to verify a new employee is a separate violation. The Director does not bring an action over an employee who has worked three business days or less.

Federal Employment Eligibility Verification: Form I-9

Under the federal Immigration Reform and Control Act of 1986 (IRCA) (8 U.S.C. § 1324a), all U.S. employers must verify the identity and employment authorization of every individual hired for employment in the United States using Form I-9 (Employment Eligibility Verification).

The Form I-9 Verification Timeline

Compliance with Form I-9 is strictly tied to calendar timelines:

• Section 1 (Employee Information and Attestation): Must be completed, signed, and dated by the newly hired employee no later than the first day of employment for pay (Day 1).
• Section 2 (Employer Review and Verification): The employer or authorized representative must physically examine original, genuine, unexpired documentation presented by the employee and complete Section 2 within three (3) business days of the employee's first day of work for pay.
  • Example: If an employee commences work for pay on a Monday, Section 2 must be fully completed and signed by the employer no later than Thursday.
  • Work Lasting Less Than 3 Days: If an individual is hired for a duration of less than three business days, Section 1 and Section 2 must both be completed no later than the first day of work for pay.

Acceptable Documents: List A vs. List B & C

An employee must be allowed to present either:

1. One document from List A (establishing BOTH identity and employment authorization): U.S. Passport or Passport Card, Permanent Resident Card (Form I-551 / Green Card), or an unexpired Employment Authorization Document with photo (Form I-766); OR
2. A combination of one document from List B (establishing Identity only, e.g., state driver's license with photo, state ID card, military ID) AND one document from List C (establishing Employment Authorization only, e.g., an unrestricted Social Security card, original certified birth certificate).

Prohibition Against Document Abuse: Employers cannot specify or dictate which acceptable documents an employee must present from the Lists of Acceptable Documents. Requiring an applicant to show a specific document (e.g., demanding a U.S. birth certificate rather than an unrestricted Social Security card) violates federal anti-discrimination laws under 8 U.S.C. § 1324b.

The Statutory Form I-9 Retention Rule

Employers must retain completed Form I-9 documents for all active employees throughout their employment. Once an employee is separated, the employer must retain the Form I-9 for a specific statutory retention period:

Statutory Form I-9 Retention Rule: Employers must retain each completed Form I-9 for the LATER of:

1. Three (3) years from the employee's date of hire; OR
2. One (1) year after the date of employment termination.

Worked Retention Scenarios

• Scenario A (Short-Term Worker):

  • Hire Date: April 1, 2024
  • Termination Date: June 1, 2024 (worked 2 months)
  • Calculation: 3 years from hire = April 1, 2027. 1 year from termination = June 1, 2025.
  • Retention Requirement: The later date is April 1, 2027 (retained 3 years from hire).

• Scenario B (Long-Term Worker):

  • Hire Date: February 1, 2018
  • Termination Date: September 30, 2025 (worked over 7 years)
  • Calculation: 3 years from hire = February 1, 2021. 1 year from termination = September 30, 2026.
  • Retention Requirement: The later date is September 30, 2026 (retained 1 year from separation).

Federal Equal Employment Opportunity (EEO) Laws

Commercial general contractors must comply with federal civil rights and non-discrimination statutes administered by the Equal Employment Opportunity Commission (EEOC) and the US Department of Labor. Employer coverage is defined by specific employee head-count thresholds.

Master Summary of Federal EEO Statutes

| Statute | Governing Federal Law | Employee Threshold | Protected Classes & Prohibited Actions | |:---|:---|:---:|:---|| | Title VII of the Civil Rights Act of 1964 | 42 U.S.C. § 2000e et seq. | 15 or more employees | Prohibits employment discrimination based on race, color, religion, sex (including pregnancy, childbirth, sexual orientation, and gender identity), and national origin in hiring, firing, compensation, assignment, or promotion. | | Americans with Disabilities Act (ADA) | 42 U.S.C. § 12101 et seq. | 15 or more employees | Prohibits discrimination against qualified individuals with physical or mental disabilities. Mandates that employers provide reasonable accommodations to qualified employees and applicants unless doing so would impose an undue hardship (significant operational difficulty or expense) on the business. | | Age Discrimination in Employment Act (ADEA) | 29 U.S.C. § 621 et seq. | 20 or more employees | Protects individuals who are 40 years of age or older from employment discrimination based on age in hiring, promotion, compensation, and conditions of employment. | | Equal Pay Act (EPA) | 29 U.S.C. § 206(d) | 1 or more employees (all FLSA-covered employers) | Prohibits sex-based wage discrimination between men and women performing substantially equal work requiring equal skill, effort, and responsibility under similar working conditions. | | Genetic Information Nondiscrimination Act (GINA) | 42 U.S.C. § 2000ff | 15 or more employees | Prohibits discrimination based on genetic information, including family medical history, in hiring or terms of employment. |

Reasonable Accommodations in Construction under the ADA

Under the ADA, a qualified individual with a disability is someone who can perform the essential functions of the job with or without reasonable accommodation. While a contractor is not required to eliminate essential structural duties (e.g., an ironworker must be able to climb and walk structural steel safely), the contractor must engage in an interactive dialogue to explore accommodations that do not compromise jobsite safety or cause undue hardship (e.g., modified tool grips, modified workstation heights, adjusted work schedules for medical treatment).