Guide to employee benefits and HR rules in South Carolina

Is your organization compliant with South Carolina's employment and HR laws?

If you're based in South Carolina or employ workers there, it's important to familiarize yourself with the state's benefits and HR compliance laws. This guide to HR laws in South Carolina will provide a general overview of the laws you need to know.

Topics covered in this guide include:

• What are an employee’s rights in South Carolina?
• What are employers required to provide in South Carolina?
• Health insurance in South Carolina
• Wage laws in South Carolina
• Other HR rules in South Carolina

What are an employee’s rights in South Carolina?

State and federal laws protect employee rights. If you currently have or plan to hire workers in the state, you must know what rights your employees have.

Some South Carolina-specific state rights include:

• At-will employment
  • In South Carolina, employment is "at-will," meaning the employer and employee can end their employment relationship at any time and for any reason that's not illegal.
• Whistleblower protection
  • There are whistleblower laws that protect workers who report violations of state or federal laws from any form of punishment or retaliation by their employer. However, to qualify for protection, the employee must file the report in good faith.
• Medical testing
  • The state prohibits employers from carrying out medical examinations or inquiring about disabilities during job interviews. They're only permitted to ask about the applicant's ability to perform job-related duties. If the employer extends a job offer, they have the right to request a medical examination before the start of employment. This is only if it's a standard requirement for all applicants and directly relates to the job.
• South Carolina mini-COBRA
  • South Carolina's Health Care Continuation Coverage Law mandates that employees with at least six months of continuous insurance coverage receive continuation of coverage for six months after termination.

What are employers required to provide to South Carolina employees?

In addition to what federal law requires, South Carolina employment law mandates that employers must provide eligible employees with specific employee benefits and accommodations.

Required benefits include:

• Court and jury duty leave
  • Employers in South Carolina must provide employees with unpaid, job-protected leave to report to jury selection or jury duty.
• Emergency response leave
  • An employer can't fire a volunteer firefighter or emergency medical services personnel for taking leave during a state of emergency declared by the U.S. president or the governor of South Carolina.
• Bone marrow donation leave
  • In South Carolina, employees who work in establishments with at least 20 employees may qualify for paid leave to donate bone marrow.
• Family and medical leave
  • The federal Family and Medical Leave Act (FMLA) allows for up to 12 weeks of unpaid leave in case of medical emergencies.
  • The following situations may qualify an employee for family and medical leave:
    • Childbirth and newborn care
    • Adoption or taking in a foster child
    • A serious health condition that prevents the employee from working
    • A family member with a serious health condition
• Military leave
  • Members of the South Carolina National Guard and State Guard receive unpaid leave when called to state duty by the governor.
  • Under the federal Uniformed Services Employment and Reemployment Rights Act (USERRA), all members of the uniformed services are eligible for unpaid military leave.
  • FMLA also covers military caregiver leave for an employee whose spouse or family member is injured on military duty.
• Crime victim leave
  • An employee in South Carolina who is involved in a crime as a victim or witness and needs to attend court for the case must receive court leave with pay.
• Workers' compensation
  • The Workers' Compensation Act covers almost all employers and employees. There are a few exceptions, such as railroad employees, certain casual employees, and businesses with fewer than four employees.
• Breastfeeding breaks
  • According to the South Carolina Lactation Support Act of 2020, women can breastfeed their children in any authorized location. The law also requires employers to provide reasonable break time and space for expressing breast milk at work.
• Unemployment benefits
  • In South Carolina, the Department of Employment and Workforce handles unemployment benefits and eligibility on a case-by-case basis.

South Carolina doesn’t require the following benefits:

• Sick time
• Bereavement leave
• Holiday leave
• Voting leave
• Meal breaks
• Rest breaks
• Vacation time
• Severance pay
• Health insurance benefits
  • The state and federal governments don’t require employers with fewer than 50 full-time equivalent employees (FTEs) to offer health insurance coverage.
  • Federal law requires organizations with 50 or more FTEs to provide affordable health benefits with minimum essential coverage (MEC) and minimum value (MV).

Health insurance coverage in South Carolina

Even if the Affordable Care Act (ACA) doesn’t require you to provide health insurance to your employees, health benefits are an excellent way to attract and retain top talent, especially in a tight labor market. However, rising premium costs have made it challenging for small and medium-sized businesses to offer traditional group health insurance.

In South Carolina, individual health insurance is cheaper than group coverage in most counties. The chart below shows the difference in monthly premiums for South Carolina's three most populated counties.

Health reimbursement arrangement (HRA)

A health reimbursement arrangement (HRA) is an IRS-approved, employer-funded health benefit that allows you to reimburse your employees, tax-free, for their individual health coverage premiums and other qualifying medical expenses.

With an HRA, you have complete control over your benefits budget while giving your employees more freedom to choose how they want to use their benefits.

Some HRAs, such as the individual coverage HRA (ICHRA), can satisfy the federal regulations for applicable large employers (ALEs). This allows organizations of all sizes that offer an HRA to save money on their health benefits.

Learn more about each HRA

Health stipend

A health stipend is a fixed sum of money offered to your employees to help pay for their healthcare expenses. A health employee stipend isn't a formal group health plan, so you have complete control over which expenses are eligible for reimbursement.

This makes a health stipend an excellent option for small businesses looking to offer a health benefit that covers costs health insurance or HRAs may not cover, such as mental health expenses.

However, a stipend doesn’t satisfy the Affordable Care Act’s employer mandate, and all reimbursements are taxable for employers and employees.

Wage laws in South Carolina

There are various federal and state laws you need to consider when it comes to setting employee wages in South Carolina.

Minimum wage laws

The 2023 minimum wage rate in South Carolina is $7.25 per hour, which is equal to the federal rate.

Subminimum wage laws

In some cases, employers can pay their workers less than minimum wage.

South Carolina is eliminating subminimum wages for workers with disabilities by August 1, 2024.

There's another type of subminimum wage known as a training wage. According to federal law, employers can pay employees younger than 20 a subminimum wage, known as a training wage, for the first 90 days of their employment. The training wage rate in South Carolina is $4.25.

The "Student-Learner program" allows employers to pay their full-time student employees at a reduced rate of 85% of the minimum wage requirement. Under this program, the minimum wage rate for students is set at $6.16.

Tipped employees

In South Carolina, tipped employees are paid the federal tipped minimum wage rate of $2.13 per hour.

Wage deductions

Employers with five or more employees in the United States must pay employees in cash or “negotiable instruments,” such as checks. Employers can only make deductions from employee wages if required by law or if the employer has informed the employee in writing about the deductions.

Overtime requirements

South Carolina follows the Fair Labor Standards Act (FLSA) for overtime hours. Hourly non-exempt employees must receive overtime pay at one and a half times their regular rate for any hours worked in excess of 40 in a week unless exempted by federal FLSA regulations.

Payment of wages

South Carolina doesn't have laws on pay frequency, but employers must still have regular paydays and inform employees of any changes.

Final pay

When an employer fires an employee, they must provide their final paycheck within 48 hours of the time of termination or on the next payday, within 30 days of separation.

Record-keeping laws

Businesses in South Carolina are legally required to keep accurate and long-lasting records of their employees. This includes the employee's name, address, Social Security number, gross earnings, pay periods, wage history, dates of employment, and absence dates. Employers must retain these records for at least four years in a location that's easily accessible for inspections.

Child labor laws in South Carolina

When it comes to laws on child labor, South Carolina follows federal FLSA laws.

In South Carolina, minors can't work in the following dangerous occupations:

• Boiler room operator
• Excavator
• Mill worker
• Miner
• Meat processing operator
• Motor vehicle operator/servicer
• Power-driven machinery operator
• Roofer
• Welder
• Jobs in establishments that serve alcoholic beverages

The FLSA also has different requirements for minors based on their age groups.

Other HR rules in South Carolina

There are a few other HR rules you need to be aware of in South Carolina.

Employment discrimination

South Carolina has several laws regarding discrimination in the workplace.

Background checks

South Carolina employers must follow regulations outlined in the Fair Credit Reporting Act (FCRA) when conducting background checks on prospective employees. Employers need to provide advanced written notice before gathering background information, as mandated by the FCRA.

There's no “ban-the-box” law for the state. However, the City of Columbia passed this type of law, which applies to all employees within city limits. This law prohibits employers from asking about a candidate's criminal record before making a "conditional job offer". Certain occupations, such as child care center staff, charter school personnel, direct care providers, police officers, private investigators, and firefighters, may require criminal background checks.

Marijuana use

Cannabis is illegal in South Carolina for both medical and recreational use. Attempts to legalize medical marijuana in 2022 failed.

No smoking

The South Carolina Clean Indoor Air Act prohibits smoking in specific public indoor areas, such as facilities offering children's services, healthcare facilities, elevators, arenas, and auditoriums. Smoking is allowed in other public buildings, but the individual responsible for the premises must make reasonable efforts to prevent designated smoking areas from affecting designated smoke-free areas.

Drug and alcohol testing

Employers can drug test job applicants in South Carolina. Employers also have the option to participate in the voluntary Drug-Free Workplace Program

Immigration verification

The South Carolina Illegal Immigration and Reform Act mandates that employers verify the legal status of new employees. This includes completing the Form I-9 and using E-Verify within three days of hiring. Employers who knowingly hire unauthorized aliens violate their license.

Frequently asked questions