Tennessee Employment and Labor Laws

As of September 2023, Tennessee has more than 3.2 million workers in its civilian labor force. The majority of these laborers come from various non-agricultural sectors, including the manufacturing, education, trade, utilities, and transportation industries. 

Because of the size of Tennessee’s labor force, the state has seen a considerable number of employment law violations like workplace discrimination. According to the Equal Employment Opportunity Commission, Tennessee had more than 2,500 cases in 2022, representing 3.5% of the nationwide total. Over half of these cases involved retaliation, and the rest included discrimination based on race and gender.

The state has also been the scene of high-profile employment lawsuits. One example was the 2006 case of former Procter & Gamble employee Dan Long. Long was fired for filing charges of racial discrimination against P&G. Through the EEOC, he sued the company for wrongful termination and received an award of damages worth $2.6 million.

Long’s case shows how workers have rights that must be acknowledged and respected. With that in mind, this article will provide employees in Tennessee with a summary of their privileges as individual workers and as members of labor unions. It will also give an overview of the legal options of those unlawfully terminated by their employers.

Tennessee’s Wage Laws

Minimum Wage and Overtime Pay

No Tennessee state law sets a minimum wage requirement for employers. However, the state follows the federal Fair Labor Standards Act, which imposes a minimum wage of $7.25 per hour throughout the country.

As to when wages must be paid, Tennessee state law requires that workers’ wages be paid not less frequently than once per month. It also mandates that workers who leave their jobs be paid their remaining wages once the current pay cycle ends. The final wages must include the worker’s vacation pay and other compensatory wages that are provided for in any labor agreement or company policy.

In terms of overtime pay, Tennessee follows the FLSA provisions on compensation for work beyond regular shifts. Under these regulations, overtime pay in the state is equal to 1.5 times the regular hourly rate of workers, and it is calculated based on the number of hours worked beyond 40 hours in a workweek.

Provisions for Tipped Employees

Similarly, Tennessee follows FLSA regulations for tipped employees; in particular, employers can pay as low as $2.13 to a tipped employee provided that the latter gets enough tips to earn $7.25 hourly. If the employee’s total earnings do not meet this minimum, their employer is required to make up the difference.

Employers are not allowed to take any portion of their employees’ tips, though they may take tip credits as long as a worker earns at least $30 a month in tips. In addition, they must notify their employees when doing so, and they cannot take a tip credit that exceeds the actual amount of tips earned by a worker.

Federal law also allows employers to establish a tip pool, where employees who are a part of such a setup must contribute a portion of their tips. In turn, this will be divided among a group of workers. Those who are required to chip in may not be forced to contribute more than what is deemed reasonable, and they must retain at least their full minimum wage.

Is Tennessee a Right-to-Work State?

Yes, Tennessee is a right-to-work state, meaning workers cannot be forced to join a labor organization or pay association dues in order to stay employed. Moreover, a worker cannot be fired for resigning from an organization, and no employer or union may create a contract or agreement denying employment to those who refuse to join or those who resign from their organization. Similarly, an employee cannot be denied a job for belonging to a specific union.

However, state law allows unions in counties, cities, towns, or municipalities with a metropolitan form of government to execute contracts or agreements that prohibit workers from resigning until the contract or agreement expires.

Any employer or organization that violates Tennessee’s right-to-work provisions will be charged with a class A misdemeanor. This can result in a fine of $2,500 and imprisonment lasting for up to 11 months and 29 days.

Tennessee Workplace Safety Provisions

In compliance with the Tennessee Occupational Safety and Health Act, the state’s Department of Labor and Workforce Development requires that employers maintain a safe and hazard-free workplace environment. 

Businesses must provide adequate safety training for workers, enforce regulations on workplace cleanup and maintenance, coordinate inspections of workplace conditions, and disseminate information through educational and outreach efforts.

In addition, the Tennessee Department of Labor and Workforce Development has established its own rules for workplace safety and health. These cover areas like injury prevention, workers’ compensation, and medical payments, as well as operations during emergencies. 

Tennessee has also adopted federal safety standards for employers, enforcing rules that apply to the general, agriculture, and construction industries.

Is Tennessee an At-Will Employment State?

Yes, Tennessee follows the at-will employment doctrine, meaning employees can fire workers at any time and for any legal reason. This also means that an employee can resign from their job if they wish without incurring legal liability.

There are certain statutory exceptions to the state’s at-will rules. Specifically, workers cannot be terminated or discharged for:

• Being enlisted in the military.

• Being absent from work to vote.

• Being called for duty as part of a jury; moreover, an employer must pay their employee their wages, though they can deduct any compensation or payment the latter receives for serving as a juror from their employment pay.

• Exercising their right to join or refuse to join a labor organization.

• Filing a workers’ compensation claim.

Additionally, an employer cannot fire a worker if the latter’s employment contract states or implies that they have job security. This contract, which can be oral or written, promises a worker continued employment under certain terms and conditions. This means that it will be unlawful to terminate the worker on grounds not specifically stated in the contract.

An employee handbook’s guidelines can also establish an “implied” contract of employment; specifically, the handbook’s regulations may state that a worker becomes a regular employee and gains access to full employment benefits after finishing a probationary period. Because of this, their employer may not terminate them at will unless the handbook states that its provisions should not be interpreted as an implied contract that guarantees continued employment.

What Qualifies as Wrongful Termination in Tennessee?

An employer who fires an employee for any of the reasons specified in the previous section or in violation of their employment contract can be charged with wrongful termination. Other forms of wrongful termination are discussed below.

Discriminatory Termination

Firing employees because of their age, race, gender, religion, or nationality is wrongful termination based on discrimination. It is prohibited under Title VII of the Civil Rights Act.

A similar restriction is found in the Family and Medical Leave Act. Under this law, businesses cannot fire employees for being absent from work due to a pregnancy or disability.

Anti-discrimination rules similar to those in federal laws are also provided in Tennessee’s Human Rights Act and Disability Act to protect employees from wrongful termination.

Retaliatory Dismissal

Tennessee prohibits employers from terminating employees in violation of public policy. For instance, a worker cannot be fired for refusing to commit an illegal act on their employer’s order,  such as laundering money or tampering with documents.

Tennessee’s Public Protection Act protects workers from being unlawfully terminated for reporting illegal activities in their workplace. This law also prevents employers from firing workers for participating in an internal investigation or testifying in court regarding such incidents.

Public employees are also protected from wrongful termination. Under Article I, Section 19 of the Tennessee Constitution, and the First Amendment, a public worker in Tennessee cannot be fired for exercising their right to free speech in cases that involve a public concern.

How Do You Report an Employer in Tennessee for Wrongful Termination?

Workers who have been wrongfully terminated in Tennessee due to discrimination, retaliation, a breach of contract, or any of the aforementioned violations can report their employer to the following agencies:

• Tennessee Human Rights Commission: (615) 741-5825.

• Equal Employment Opportunity Commission: (615) 736-5820 and (800) 669-4000.

Employees can choose to represent themselves in wrongful termination cases. However, because of the statutory guidelines and deadlines involved, regardless of where a complaint is filed, it is recommended that they seek assistance from an employment attorney who can guide them throughout the process.

Filing a Complaint with the Tennessee Human Rights Commission

An unlawfully terminated worker can also initiate the formal complaint process with the THRC by filing a discrimination complaint form. After the commission receives the complaint, the worker will be given the chance to settle the issue with their employer through mediation. The process is free of charge, and any details discussed by both sides will remain confidential.

However, if no settlement is reached, the worker’s case will progress into an investigation, and the commission will schedule an administrative hearing if it determines that discrimination against the worker did occur. 

If the commission dismisses the complaint due to a lack of reasonable cause, the worker can file an appeal with the state or federal court. The same option is available if the worker does not agree with the commission’s final order at their hearing.

Filing a Complaint with the Equal Employment Opportunity Commission

The EEOC complaint process follows a pattern similar to that of the THRC. However, with the EEOC, workers are required to undergo pre-complaint counseling beforehand. After this, the commission will give the complainant 15 days to file a formal complaint. It will also inform the worker of their reasons for denying specific claims that are part of the case.

The commission will then conduct an official investigation that will be completed within the next 180 days. From here, it will give the complainant either the right to request an administrative hearing to progress their case or a final decision that is issued without a hearing.

The complainant will then have 30 days to either request a hearing or appeal the official decision. If they are not satisfied with the decision on their appeal, they can submit another appeal to the EEOC within 30 days or to the federal district court within 90 days.

Like the THRC, the EEOC offers complainants the opportunity to resolve the case outside of court through an alternative dispute resolution program. Likewise, the case may progress to a hearing if both parties cannot reach an agreement.

What Is the Statute of Limitations for Wrongful Termination Cases in Tennessee?

There are different statutes of limitations for wrongful termination cases in Tennessee, depending on the type of offense from which a specific case stems. They are as follows:

• If a worker is terminated in violation of public policy, the statute of limitations lasts for one year, like with other tort claims.

• If a worker is terminated through a breach of an oral or written contract, the statute of limitations lasts for six years.

• If a worker is terminated in violation of the FMLA, the statute of limitations lasts for two years or three if the violation is willful.

• If a worker is terminated for a discriminatory reason, the statute of limitations lasts for 180 days. If the discrimination in question is also prohibited under Tennessee law, the statute of limitations lasts for up to 300 days.

In addition to these statutes, employees should note the deadlines involved when filing a wrongful termination complaint or appealing a decision regarding their case. This is particularly true for cases handled by the EEOC, as specified above.

How Much Can Someone Sue an Employer in Tennessee for Wrongful Termination?

The amount of compensation an unlawfully terminated employee in Tennessee can recover depends on the factors involved in the case. Generally, the damages a worker can recover in a wrongful termination complaint include:

• Wages and benefits that they have been unable to receive since the date of their termination.

• Legal filing fees and attorney costs.

• Out-of-pocket expenditures.

• Non-economic damages stemming from the emotional stress brought by their termination.

• Punitive damages; however, these are not awarded for discrimination-based claims in Tennessee.

State and federal laws impose caps on economic, non-economic, and punitive damages in wrongful termination cases. In Tennessee, the limitations on economic and non-economic damages are as follows:

• $25,000 if the employer has eight to 14 employees.

• $50,000 if the employer has 15 to 100 employees.

• $100,000 if the employer has 101 to 200 employees.

• $200,000 if the employer has 201 to 500 employees.

Federal statutes follow the same caps, though they apply to the combined compensatory and punitive damages a worker can recover.

Those who are involved in age-based discrimination cases or issues involving gender-based wage discrimination in Tennessee cannot recover compensatory or punitive damages under federal law. However, they are still entitled to “liquidated” damages equal to the amount of back pay they are awarded.

Resources for Employees in Tennessee

Tennessee Human Rights Commission

The Tennessee Human Rights Commission is open to workers who have been discriminated against. Employees who have been unlawfully terminated can file their complaint on its website; a separate complaint form is available for Spanish-speaking workers. 

Those who wish to learn more about state regulations and federal laws related to employment can also visit the website for resources that discuss these topics. People can call the THRC at (800) 251-3589 or email ask.thrc@tn.gov for other inquiries.

Tennessee Department of Labor and Workforce Development

The Tennessee Department of Labor and Workforce Development provides resources that can help educate workers in the state on their employment and labor rights. People who wish to learn more about employment programs and training opportunities throughout the state can find the information they need on the department’s website. 

Additionally, the department can redirect employees to the Tennessee Bureau of Workers’ Compensation section for concerns related to compensation claims and appeals. For further queries, interested parties can contact the department at (844) 224-5818.

Legal Aid Society of Middle Tennessee and the Cumberlands

The Legal Aid Society of Middle Tennessee and the Cumberlands is a nonprofit law firm that assists low-income individuals and families in 48 counties. The members of its Volunteer Lawyers Program handle various non-criminal matters, including cases that involve work-related discrimination, job termination, and workers’ compensation. 

Its website also offers access to self-help resources, such as videos or booklets, that users can refer to for basic information related to their concerns. LAS can be reached via telephone at (615) 244-6610.

Tennessee Employment Lawyers Association

Tennessee Employment Lawyers Association is an affiliate of the National Employment Lawyers Association. Its members provide legal assistance to workers in the state who have experienced unlawful discrimination at their workplace. To connect with a member of the organization who may be able to help them, users can view the members’ list on the TENNELA website and use the contact information listed there.