EMPLOYMENT LAW NEWS
ZIP Codes Don’t Cut It for Employment Law Compliance
By GovDocs
Updated October 2024
Large, multi-jurisdiction employers have plenty of employment law issues to manage without worrying about applying the wrong jurisdiction’s laws.
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With the sharp increase in city and county requirements over the last few years, organizations have faced a new challenge: making sure they know the correct jurisdiction for their locations.
At first glance, it might seem easy enough to determine which jurisdiction applies to which location. But it’s not always simple.
In the past, employers could focus on federal and state laws, but all that has changed. Whether it’s minimum wage, paid leave or labor law posters, there are over 22,000 cities and counties that have the ability to issue new requirements. This makes jurisdictional accuracy more crucial than ever.
Below, we will walk through a few examples why zip codes are not an accurate method to determine which employment laws apply and go through some real-world examples.
Ditch the ZIP: Jurisdictional Boundaries Go Beyond Postal Codes
ZIP codes were initially made to make mail delivery easier. They weren’t created to correspond to jurisdictional boundaries for cities, counties, or states.
There are 4 main reasons zip codes are problematic to determine jurisdictions which include:
- They are designed for the efficient delivery of mail by the U.S. Postal Service and do not necessarily correspond to legal or administrative boundaries such as city limits, county lines, or state borders.
- In some cases, multiple ZIP codes can overlap within the same jurisdiction, or a single ZIP code can be divided among several different municipalities or counties. This overlap can lead to confusion and inaccuracies when trying to determine jurisdictional boundaries.
- ZIP codes do not offer the precision needed for legal or regulatory purposes. Specific geographical boundaries define jurisdictions that require more detailed data and geographic coordinates to accurately determine them.
- Jurisdictions such as city boundaries or county lines can change over time due to annexations, redistricting, or other factors, but ZIP codes may not be updated to reflect these changes. This can lead to outdated or incorrect jurisdictional information if relying solely on ZIP codes.
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When Zip Codes Collide: Addressing Compliance in Overlapping Jurisdictions
So, what are some real-world examples of the challenges of using ZIP codes to apply employment laws?
Take for example the zip code of 60629 which is named Chicago, Illinois. This zip code spans several neighborhoods that include the city of Chicago and the village of Bedford Park, leading to overlapping regulations and compliance requirements.
At a larger level, ZIP codes can also span state borders:
- 42223 straddles Christian County, Ky., and Montgomery County, Tenn.
- 97635 includes portions of Lake County, Ore., and Modoc County, Calif.
- 51023 and 51001 are in both Iowa and Nebraska
Meanwhile, as another example, Oregon breaks out its minimum wage law based on population density:
- Portland metro area’s urban growth boundary
- Standard counties
- Non-urban counties
But these borders can shift with new development, population changes, and other factors. And none of them have to do with ZIP codes.
Example: One mall that falls into two jurisdictions in Santa Clara
As one might expect, labor law posters, minimum wage rates and other employment laws vary across jurisdictions, and maintaining compliance based on ZIP codes isn’t the best strategy.
Even using city addresses can cause issues. Consider city names in a large metropolitan area where the city name is used for the city, and all the suburbs surrounding the city, which all may entail different laws.
Example:
There is a mall in California with a Santa Clara address. But a portion of the structure falls within the bordering city of San Jose, which has a paid sick leave law, while Santa Clara does not. This, of course, could lead to noncompliance if an organization doesn’t have accurate tabs on a location.
Leveraging Resources to Navigate Jurisdictional Boundaries Beyond Zip Codes
Large, multi-jurisdictional employers have plenty of employment law issues to manage without worrying about applying the wrong laws.
One way to combat this is through a closer examination of locations. Employers should take a magnifying glass to the jurisdictions where they have locations to ensure accuracy.
But even more precise is partnering with an employment law compliance provider with technology designed to reduce manual research and eliminate the risk of miscalculating a border. GovDocs is announcing the use of LocationCheck, a process of taking an organization or employee’s physical address and assigning longitude and latitude coordinates to determine a jurisdictional assignment.
With GovDocs LocationCheck, you can:
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Skip sifting through layers of stacked maps to navigate the boundaries of states, cities, counties and more to know which jurisdiction your location requirements land in.
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Avoid paying costly fines for missing postings at required locations due to wrong jurisdictional assignments.
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Implement organization wide audits with confidence to avoid the risk of noncompliance.
Conclusion
Employers with hundreds, or even thousands, of locations across the U.S. have plenty of employment law matters to address.
But without the right jurisdiction, nothing else matters, and it opens the door for noncompliance and issues that can come with it:
- Fines
- Investigations
- Overpaying employees
- Underpaying employees
- Bad press
For employers that operate in many jurisdictions across the nation, ensuring location accuracy is the first step toward a successful compliance program.
This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.
What is GovDocs?
GovDocs simplifies employment law compliance for large, multi-jurisdiction employers in the U.S. and Canada. The GovDocs software platform integrates three solutions in one convenient place to help you master the employment laws impacting your business. Whether you manage a postings, minimum wage or paid leave program, our products cut through research time, provide proactive insights into the everchanging landscape of employment laws and reduce the risk of noncompliance. The company is headquartered in St. Paul, Minn.
The GovDocs Poster Store simplifies posting compliance for employers with less than 30 locations across all industries, offering a variety of posting products to meet your labor law compliance needs.
