9.3 Anti-Discrimination Statutes, FMLA, Prevailing Wage Laws, and Tennessee Protections

Beyond wage-and-hour and work-authorization rules, Tennessee contractors must comply with a matrix of federal and state civil rights, family leave, employee benefit, public works prevailing wage, wage garnishment, and state payroll administration laws. On the Tennessee Business and Law exam, an essential topic is knowing the exact employer headcount threshold and dollar contract trigger for each statute.

Federal and Tennessee Anti-Discrimination, Leave, and Benefit Thresholds

Different employment statutes take effect as a construction firm's workforce grows. Notice in particular that the Tennessee Human Rights Act (8+ employees) applies to smaller Tennessee contractors long before federal Title VII (15+ employees) kicks in!

Deep Dive: Family and Medical Leave Act (FMLA) Eligibility & Leave Rules

To be personally eligible to take FMLA leave, an employee must satisfy three cumulative requirements:

1. Have worked for the covered employer for at least 12 months (need not be consecutive);
2. Have actually worked at least 1,250 hours during the 12-month period immediately preceding the start of the leave; AND
3. Work at a jobsite where the employer employs 50 or more employees within a 75-mile radius.

• 12 Workweeks vs. 26 Workweeks: Standard FMLA entitlement is 12 workweeks of unpaid, job-protected leave during a 12-month period for: (a) birth and care of a newborn child; (b) placement of a child for adoption or foster care; (c) caring for an immediate family member (spouse, child, or parent) with a serious health condition; (d) the employee's own serious health condition; or (e) a qualifying exigency arising out of a family member's covered active military duty. If the employee is the spouse, son, daughter, parent, or next of kin caring for a covered servicemember with a serious injury or illness incurred in the line of duty (Military Caregiver Leave), the entitlement expands to up to 26 workweeks of unpaid leave during a single 12-month period.
• ERISA (Employee Retirement Income Security Act of 1974): Keep in mind that ERISA does not require any contractor to establish a pension, 401(k), or health plan; however, if a private employer voluntarily establishes a retirement or welfare benefit plan, ERISA sets strict federal minimum standards for fiduciary duties, reporting, disclosure, participation, vesting, and funding.

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Federal Public Works Labor Statutes and Wage Garnishment Limits

When a Tennessee contractor bids on federal or federally assisted construction contracts, three landmark public works labor laws apply:

1. Davis-Bacon and Related Acts (DBRA — Contracts Exceeding \$2,000):
   • Applies to all federal and federally assisted contracts in excess of $2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works.
   • Prevailing Wage & Fringe Benefits: Contractors and subcontractors must pay all laborers and mechanics working directly on the site of the work not less than the locally prevailing wages and bona fide fringe benefits determined by the Secretary of Labor for the corresponding trade classification.
   • Weekly Payment & Certified Payroll (Form WH-347): Workers must be paid unconditionally at least once a week, the official Davis-Bacon wage scale and poster (WH-1321) must be posted prominently at the jobsite, and the contractor and every subcontractor must submit weekly Certified Payroll Reports (WH-347 is an optional format) to the contracting agency within 7 days after the regular payment date of the payroll week.
2. Copeland "Anti-Kickback" Act:
   • Makes it a federal crime (punishable by fine and up to 5 years' imprisonment) to induce any worker on a federally funded construction project, by force, intimidation, or threat of dismissal, to give up or "kick back" any portion of the compensation to which they are entitled. It also requires each weekly Certified Payroll Report to be accompanied by a signed Statement of Compliance certifying that all workers were paid their full prevailing wages without unlawful rebates or deductions.
3. Contract Work Hours and Safety Standards Act (CWHSSA — Direct Federal Contracts Exceeding \$200,000):
   • Applies to federal construction direct federal contracts in excess of $200,000 under the current FAR; federally assisted contracts need their applicable statutory threshold checked. It requires contractors and subcontractors to pay laborers, mechanics, guards, and watchmen at least $1.5\times$ their basic rate of pay for all hours worked in excess of 40 hours in a workweek on the covered contract. Violations subject the contractor to unpaid overtime restitution plus statutory liquidated damages per calendar day for each underpaid employee.

Consumer Credit Protection Act (CCPA Title III) — Wage Garnishment Limits

Enforced by the U.S. Department of Labor Wage and Hour Division, Title III of the Consumer Credit Protection Act (CCPA) protects employees whose wages are garnished by creditors:

• Protection Against Discharge for One Debt: An employer may NEVER discharge (fire) an employee because the employee's earnings have been subjected to garnishment for any one single indebtedness (regardless of how many levies or proceedings are brought to collect that single debt).
• Maximum Ordinary Creditor Garnishment Formula: Based on disposable earnings (gross pay minus deductions required by law such as federal/state taxes, Social Security, Medicare, and state unemployment insurance—voluntary deductions like health insurance or 401(k) contributions are not subtracted when computing disposable earnings), the maximum weekly ordinary creditor garnishment is the LESSER of:

$$\text{Max Ordinary Garnishment} = \max\Big(0,\min\big(0.25 \times \text{Weekly Disposable Earnings},\; \text{Weekly Disposable Earnings} - (30 \times \text{\textdollar}7.25)\big)\Big)$$

Because $30 \times \text{\textdollar}7.25 = \text{\textdollar}217.50$, if an employee's weekly disposable earnings are $217.50 or less, nothing may be garnished for an ordinary debt; if disposable earnings are $290.00 or more ($40 \times \text{\textdollar}7.25$), the 25% cap controls.

• Child Support and Alimony Garnishment Limits: For support orders, CCPA Title III allows garnishment of up to 50% of disposable earnings if the employee is supporting another spouse or child, or up to 60% if the employee is not supporting another spouse or child—plus an additional 5% (55% or 65%, respectively) if support payments are more than 12 weeks in arrears.

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Tennessee-Specific Wage Payment, Final Paycheck, and New Hire Laws

On the Tennessee Contractor Business and Law exam, you must also memorize the exact statutory deadlines in Title 50, Title 36, Title 2, and Title 22 of the Tennessee Code Annotated (T.C.A.):

• Tennessee Wage Regulation Act — Pay Frequency (T.C.A. § 50-2-103): Every private employer in Tennessee that employs 5 or more employees must establish and maintain regular paydays and pay wages at least once per month:
  • If paid once per month, wages earned during the preceding month must be paid no later than the 5th day of each succeeding month.
  • If paid two or more times per month (semimonthly, biweekly, or weekly), wages earned prior to the 1st day of any month are due not later than the 20th day of the month following the one in which the wages were earned, and wages earned prior to the 16th day of any month are due not later than the 5th day of the succeeding month.
• Tennessee Final Paycheck Deadline (T.C.A. § 50-2-103(g)): Any employee who leaves voluntarily or is discharged (fired) from employment must be paid in full all wages or salary earned no later than the next regular payday following the date of dismissal or voluntary leaving, OR twenty-one (21) days following the date of dismissal or voluntary leaving, whichever occurs LATER! No employer may obtain an exemption from this final paycheck rule.
• Tennessee New Hire Reporting Program (T.C.A. § 36-5-1102): Every employer doing business in Tennessee must report all newly hired or rehired employees to the Tennessee New Hire Reporting Program (administered by the Tennessee Department of Human Services) within 20 calendar days of the date of hire (or by the first regularly scheduled transmission date if reporting electronically/magnetically twice per month between 12 and 16 days apart). This database is used to enforce child support income withholding orders and detect unemployment compensation fraud.
• Tennessee Voting Leave (T.C.A. § 2-1-106): Any person entitled to vote in a Tennessee election may be absent from work for a reasonable period of time, not to exceed 3 hours, while the polls are open in the county where the employee is a resident, unless the employee's work shift begins 3 or more hours after the polls open OR ends 3 or more hours before the polls close. To qualify, the employee must apply for voting leave before 12:00 noon on the day before the election, the employer may specify the hours during which the employee may be absent, and the employer may not deduct from the employee's usual salary or wages or penalize the employee for taking qualified voting leave.
• Tennessee Jury Duty Protection (T.C.A. § 22-4-106): An employee summoned for jury duty must show the summons to their supervisor on the next working day after receiving it. If the employee serves more than 3 hours in a day, the employer must excuse the employee from work for that day (including night-shift workers from the shift before or after jury service). Furthermore, an employer with 5 or more regular employees must pay a regular employee (employed for at least 6 months) their usual compensation minus the fee/compensation received for jury service, and no employer may discharge or demote an employee solely for serving on a jury.

FMLA employer coverage and individual eligibility are separate: a private employer generally needs 50 employees in at least 20 workweeks, while an eligible employee ordinarily needs 12 months of service, 1,250 hours, and 50 employees within 75 miles. Public agencies have different coverage rules. Davis-Bacon certified payroll is submitted weekly; WH-347 is an optional reporting format, not the only lawful form. For direct federal contracts, the current FAR 22.305 CWHSSA clause threshold is over $200,000; federally assisted work can use different statutory thresholds. The federal garnishment maximum cannot be negative, and a more protective applicable state rule must also be considered.

Source check (October 13, 2026): FAR 22.305 overtime clause threshold.