Skip to Main Content
Quick and Easy Guide to Labor & Employment Law: Tennessee

This state-specific guide covers labor and employment case law, statutes, rules, and regulations that HR professionals and clients often encounter or have questions about in Tennessee.

At-Will Employment

The employer/employee relationship is governed by the at-will employment doctrine. This means that either party may terminate the relationship at any time, with or without cause, and with or without notice. There is a public policy exception, however, that an employer shall not discharge an employee solely for refusing to participate in, or refusing to remain silent about, illegal activities. Tenn. Code Ann. § 50-1-304. Other exceptions to the at-will doctrine are that an employer may not terminate an employee for being called to military service, voting in elections, exercising the right of association, wage garnishments, filing a workers' compensation claim and being called to jury duty. In addition, an express agreement (e.g., employment contract) or statute could narrow or limit the at-will doctrine. Further, under Tennessee law, an employee may have a claim for tortious interference with his or her at-will employment relationship against a third party. Forrester v. Stockstill, 869 S.W.2d 328, 330 (Tenn. 1994).

Right to Work Laws

Tennessee is a right-to-work state, and its laws governing the same are found at Tenn. Code Ann. § 50-1-201, et seq. An employer cannot condition upon membership or non-membership in any labor union or labor organization an employee's right to work. Tenn. Code Ann. § 50-1-201. Further, an employer cannot deny employment due to an individual's payment or refusal to pay labor union dues or other fees associated with an employee organization. Tenn. Code Ann. § 50-1-203.

Immigration Verification

The Tennessee Lawful Employment Act, Tenn. Code Ann. §§ 50-1-701, et seq. (TLEA), applies to all employers who have six or more employees. To comply with the TLEA, an employer must either (1) enroll and participate in E-Verify or (2) obtain a copy of one identity and employment authorization document listed in the TLEA from all newly hired employees and "non-employees" (any other individuals paid directly by the employer in exchange for labor or services). If the I-9 file contains any of the documents listed in the TLEA, no further steps are needed to comply.

NOTE: By requiring compliance with respect to "non-employees," the TLEA essentially imposes a new documentary requirement for users of self-employed vendors because the I-9 is completed only for employees under federal law.

Failure to comply will result in the enforcement of monetary fines of increasing severity. TLEA requires the same retention of documents as I-9s: one year after termination or three years after hire. To simplify compliance, it is recommended that an employer keep both the TLEA verification document and the I-9 for at least three years following an employee's departure.

**Effective January 1, 2017, Private employers with 50 or more employees must use the E-Verify system to verify the employment eligibility of all employees hired on or after January 1, 2017. 2016 Tennessee Laws Pub. Ch. 828 (S.B. 1965). For more information about upcoming changes in Tennessee immigration verification requirements, click here to see Baker Donelson's Immigration Blog.

Drug Testing

Employers may discharge an at-will employee who tests positive on a random drug test, and it is misconduct for an employee to refuse to take a drug or alcohol test. Additionally, the Tennessee Drug Free Workplace Act, Tenn. Code Ann. § 50-9-101, et seq., provides certain benefits to certified employers, including a five percent discount on the employer's workers' compensation insurance premium. Moreover, if an employee working in a certified Tennessee Drug Free Workplace tests positive on a post-accident drug screen, the employee forfeits eligibility for workers' compensation benefits unless the employee proves that intoxication did not cause the accident. Additionally, an employee fired for a positive drug screen is presumed ineligible for unemployment compensation. An amendment to the law enacted in 2017 requires a covered employer "who has employees who are health care practitioners for the purposes of Tenn. Code Ann. 63-1-126 shall report a health care practitioner who tests positive for any drug on any government or private sector pre-employment or employer-ordered confirmed drug test, or who refuses to submit to a drug test, to the department of health and the practitioner's licensing or certifying board" if the practitioner fails to produce a lawsuit prescription for the drug or a valid medical reason for using the drug, or to report to the state's substantive abuse peer assistance or treatment program of the health care provider's board. The Tennessee Department of Labor revised Drug Free Workplace requirements in regulations issued May 6, 2018.

Jury Duty Leave

Employers shall excuse the absence of an employee summoned to jury duty. For the absence to be excused, the employee must exhibit the summons to the employer the day after it is received. For such excused absences, employers with five or more employees must pay the summoned employee his/her "usual compensation" minus the jury service fee for such time spent serving on jury duty. The employee need not return to work on the day or days in which the employee's responsibility for jury duty exceeds three hours. The employer is not required to compensate an employee for more time than was actually spent serving and traveling to and from jury duty. Employees who work the night shift should be excused from working the shift preceding their first day of jury duty, as well as shifts occurring within 24 hours after a day of jury service lasting more than three hours. Tenn. Code Ann. § 22-4-106.

Voting Leave

An employer must provide an employee with a reasonable period of time, not to exceed three hours, necessary to vote during the time the polls are open in the county where the employee is a resident. If the work hours of an employee commence at least three hours after the opening of the polls or end at least three prior to the closing of the polls, the time off for voting is not available. To be eligible for this time off, an employee must notify the employer before 12:00 p.m. of the day before the election. A voting employee who is properly absent from work so that he or she may vote, may not be subjected to any penalty or reduction in pay for such absence. Tenn. Code Ann. § 2-1-106.

Parental Leave

An employee who works for an employer with 100 or more employees at the job site or location, and who has been employed for at least 12 consecutive months as a full-time employee, may be absent from employment for a period not to exceed four months for the purpose of adoption, pregnancy, childbirth and nursing of an infant, where applicable. Tenn. Code Ann. § 4-21-408.

An employee who gives at least three months' advance notice of his or her anticipated date of departure, the length of leave, and his or her intention to return to full-time employment after leave, will be restored to the previous or similar position with the same status, pay, length of service credit and seniority. Id. An employee who does not give three months' advance notice because of a medical emergency that necessitates that the leave begin earlier than originally anticipated, or because his or her notice of adoption was received less than three months in advance, does not forfeit the right to parental leave. Id. If an employee's job position is so unique that the company cannot, after reasonable efforts, temporarily fill the position, then the employee has no right to reinstatement at the end of the leave. Id.

The "Tennessee Pregnant Workers Fairness Act" (Senate Bill 2520) went into effect October 1, 2020. Under the new Act, every employer with at least 15 employees must make a reasonable accommodation for an employee's or prospective employee's medical needs arising from pregnancy, childbirth or related medical conditions, unless such accommodation would impose an undue hardship on business operations. The new Act provides specific examples of accommodations that may be considered and is intended to bolster the existing protections under Title VII.

Parental leave runs concurrent with FMLA leave and may be with or without pay at the discretion of the employer.

Other Leave

The State of Tennessee does not require employers to offer to employees paid vacation or sick leave. For example, see Tenn. Code Ann. § 50-2-103(a)(3).

Whistleblower Laws

State employees are encouraged to report violations of state or federal law or regulations, fraud in government programs, misappropriation of government resources, health and safety dangers, mismanagement and abuses of authority. Whistleblowers are protected from retaliation for reporting: violations of state and federal laws and regulations, fraud, misappropriation of resources, health and safety dangers, gross mismanagement, gross waste of government funds or gross abuse of authority. Employees may not be retaliated against for refusing to carry out orders if the order violates state or federal law, regulations, written policy or procedure, or orders that pose an unreasonable health and safety risk. Tenn. Code Ann. § 8-50-116.

The False Claims statute both serves to protect whistleblowers, by providing additional provisions which reiterate the protections from the previous statute, as well as providing for qui tam actions whereby the whistleblower may claim a percentage of the bounty recovered from a successful court action. Tenn. Code Ann. § 4-18-105.

The Tennessee Public Protection Act, which applies to both public and private sector employees, provides that no employee shall be discharged or terminated solely for refusing to participate in, or for refusing to remain silent about, illegal activities. Tenn. Code Ann. § 50-1-304.

Smoking Laws

An employer shall not terminate an employee solely for participating or engaging in the use of an agricultural product not regulated by the alcoholic beverage commission that is not otherwise proscribed by law, if such employee participates or engages in such use in a manner which complies with all applicable employer policies. Tenn. Code Ann. § 50-1-304(e).

Under the "Children's Act for Clean Indoor Air," Tenn. Code Ann. § 39-17-1601, et seq., smoking is prohibited in certain areas frequented by children, including health care facilities, museums, schools, residential treatment facilities and zoos.

Under the "Non-Smoker Protection Act," Tenn. Code Ann. § 39-17-1801, et seq., smoking is prohibited in all enclosed public areas not specifically exempted by statute, including restaurants, banks, laundromats, manufacturing facilities, professional offices and other workplaces. The "Non-Smoker Protection Act" has several exemptions, including age-restricted venues, hotel rooms designated as smoking rooms and the premises of a manufacturer, importer or wholesaler of tobacco products.

Break Time to Express Milk

An employee must be given reasonable unpaid break time each day to express breast milk for that employee's infant child, unless providing the break would unduly disrupt the employer's operations. The break time may run concurrently with any other break time provided. The employer must make reasonable efforts to provide a private location other than a toilet stall for the employee's use. Tenn. Code Ann. § 50-1-305. Additionally, the federal Fair Labor Standards Act (FLSA) requires employers to provide reasonable break time for an employee to express breast milk for her nursing child for one year after the child's birth each time such employee has need to express the milk. Employers are also required to provide a place, other than a bathroom, that is shielded from view and free from intrusion from coworkers and the public, which may be used by an employee to express breast milk.

Meal Breaks

Subject to exceptions under the statute, an employer must allow each of its employees one 30-minute rest break or meal period if scheduled to work six or more hours consecutively. Tenn. Code Ann. § 50-2-103(h).

Minimum Wage

The State of Tennessee has no law regulating minimum wage.

Final Payments

Following separation, an employee must be paid all wages due and owing, including all accrued and unused vacation time if the employer's policies provide for such time. An employer must pay the wages by the next regular payday, not to exceed 21 days from the date of termination. Tenn. Code Ann. § 50-2-103(g). In addition, when no beneficiary to receive payment for wages or salary has been designated by the employee, Tennessee law allows employers to pay to the surviving spouse or children of a deceased employee the last wages, not to exceed $10,000, and other benefits due the deceased employee without a court order. Tenn. Code Ann. § 30-2-103. If the sum exceeds $10,000, the excess shall be paid to the court representative as ordered by the court.

Unemployment Insurance

Unemployment insurance benefits provide income to individuals who have lost work through no fault of their own. The benefits are intended to partially offset the loss of wages while an unemployed worker searches for suitable work or until an employer can recall the employee to work. Nothing is deducted from the employee's wages to pay for this coverage. Unemployment benefits are administered by the Department of Labor and Workforce Development, and additional information regarding the benefits may be accessed at www.tn.gov/workforce.html.

Workers' Compensation

The Tennessee Workers' Compensation Act, Tenn. Code Ann. § 50-6-101, et seq., applies to every employer in Tennessee with five or more employees, or those in the construction and coal mining industries. Employees who suffer injuries and/or occupational diseases arising out of and in the course of their employment may be eligible to receive several types of benefits under the Act. The Act is administered by the Department of Labor and Workforce Development and additional information regarding the Act may be accessed at www.tn.gov/workforce/injuries-at-work/injured-workers.html.

Under the Act, a workplace injury must be immediately reported to the employer; failing to timely report an injury may result in a denial of benefits. Finally, an employer may be held liable to a discharged employee if that employee's claim for benefits under the Act was a "substantial factor" in that employee's termination.

Child Labor

The Tennessee Child Labor Act of 1976 is found at Tenn. Code Ann. § 50-5-101, et. seq. Tennessee has prohibited occupations for minors, Section 50-5-106, and various rules concerning the time minors may work, based on age. Tenn. Code Ann. §§ 50-5-103-105. A minor under 14 may not be employed unless there is an applicable statutory exemption. Moreover, before any minor may be employed or continue employment, "the employer shall require proof of the age of the minor employee or prospective employee by requiring the minor to provide the employer with a copy of the minor's birth certificate, passport, driver's license or state issued identification." Tenn. Code Ann § 50-5-109. If the above evidence is not available, a parent or guardian shall appear before a judge in the minor's county of residence and make an oath regarding the age of the minor. Id.

Gun Laws

Under Tennessee law, an "individual, corporation or business entity is authorized to prohibit the possession of weapons by employees otherwise authorized by this subsection (b) on premises owned, operated or managed by the individual, corporation or business entity. Notice of the prohibition shall be posted or otherwise noticed to all affected employees." Tenn. Code Ann. § 39-17-1315(b)(1). However, on July 1, 2013, Tennessee's so called "guns in trunks" law took effect. This law provided that a holder of a handgun-carry permit that is recognized in Tennessee may keep such handgun in the permit holder's privately owned vehicle while on any public or private parking area if the permit holder's vehicle is in an area it is permitted to be and the firearm is kept from ordinary observation in the vehicle if the holder is in the vehicle or is kept from ordinary observation and locked within the trunk, glove box or interior of the person's privately owned vehicle or a securely affixed container if the holder is not in the vehicle. Tenn. Code Ann. § 39-17-1313.

These laws suggest that an employer may prohibit an employee from bringing a firearm on its private property as long as proper signs are posted, and an employer can prohibit the employee from storing a firearm in a company vehicle, but the employee may store a firearm in his or her private vehicle in the employer's parking lot even if a sign is posted. Nonetheless, the Tennessee Attorney General and the Office of Legal Services (OLS) of the General Assembly for Tennessee have issued two conflicting opinions on whether an employer may terminate an employee for having a weapon in his or her vehicle while parked on the employer's property. The May 28, 2013 Attorney General opinion determined that the law did not prohibit an employer from discharging the employee, Opinion No. 13-41, while a January 13, 2014 OLS opinion stated the opposite. The disagreement stems from the difference in how the opinions interpret the two applicable statutes: § 39-17-1359 and § 39-17-1313. The Attorney General opinion seems to be more straightforward; however, a court will have to clarify the law regarding whether an employer can terminate an employee for having a firearm in his or her vehicle at work since the legislature's' opinion stated no amendment is necessary.

On January 1, 2020, Section 39-17-1359 was amended to provide enhanced requirements for signs and notices posted that prohibit firearms on the property.

Pursuant to Section 39-17-1309, Tennessee public colleges and universities must allow full-time employees who possess enhanced handgun-carry permits to carry handguns on campus. Any employee who elects to carry a handgun must provide written notification to the law enforcement agency with jurisdiction over the property owned, operated or controlled by the employing institution. The employee's name and any other information that might identify the employee as a person who has elected to carry a handgun on institution grounds will be confidential. The law also provides that the employee is not acting within the course and scope of employment by carrying or using the handgun, is not immune from personal liability, is not entitled to workers' compensation for injuries arising from the use or carrying of the handgun and is not permitted to carry the handgun openly or in a visible manner. Additionally, the employee may not carry the handgun in gymnasiums, stadiums or auditoriums when school-sponsored events are in progress, in disciplinary meetings, in meetings regarding tenure issues, in hospitals or places where mental or medical health services are provided, or in any area where a provision of state or federal law, except the posting provisions of § 39-17-1359, prohibits the carrying of a handgun on that property.

Tennessee passed a law effective January 1, 2020, distinguishing between concealed carry permits, which authorize the holders thereof to carry concealed but not open (i.e., with the gun visible), and "enhanced" carry permits, which allow open or concealed carry. § 39-17-1351 (as amended by 2019 Public Acts c. 479 §§ 3, 4). Tennessee school staff relying on § 39-17-1309 above require an enhanced permit rather than the ordinary concealed carry permit. The change will soon be moot, due to the recent passing of the "constitutional carry" law, allowing adults to carry handguns without any permit.**

**Effective July 1, 2021, SB 765 amends Section 39-17-1307 to permit concealed or open carry of a handgun without a permit as long as the person is 21 years of age and in a place they may lawfully be present. For members of the armed forces (and honorably discharged veterans), the minimum age is lowered to 18. The bill also amends Section 29-17-1313 to allow storage of a handgun in a car by anyone eligible to carry a handgun under Section 39-17-1307. 

Additional Laws & Regulations

Tennessee Human Rights Act (THRA). The Act, which may be found at Tenn. Code Ann. § 4-21-101, et seq., mimics Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967 in that it prohibits discrimination because of an individual's race, creed, color, religion, sex, age or national origin. Further, like the Pregnancy Discrimination Act of 1978, the Act prohibits discrimination based on pregnancy. The Act applies only to employers with eight or more employees.

Tennessee Disability Act (TDA). The Act, which may be found at Tenn. Code Ann. § 8-50-103, mimics the Americans with Disabilities Act of 1990, as amended in that it prohibits discrimination because of an individual's physical, mental or visual disability. The Act provides that there shall be no discrimination in the hiring, firing and other terms of employment because of the disability "unless such disability to some degree prevents the applicant from performing the duties required by the employment sought or impairs the performance of the work involved." It further prohibits discrimination against a blind person because the person uses a guide dog. However, unlike its federal counterpart, the TDA does not impose a duty on employers to make reasonable accommodations to accommodate a disabled employee. Bennett v. Nissan North America, Inc., 315 S.W.3d 832 (Tenn. App. 2009).

Tennessee Public Protection Act (TPPA). This Act, which may be found at Tenn. Code Ann. § 50-1-304, provides a retaliatory discharge claim for an employee. The person must prove (1) he was an employee; (2) he refused to participate in, or to remain silent about, illegal activities; (3) he was terminated by his employer and (4) there is an exclusive causal relationship between the plaintiff's refusal to participate in or remain silent about illegal activities and his termination.

In 2014, the Governor signed legislation that amended the THRA, TPPA and the TDA. Some of the major changes include:

  • Creating a tiered damages cap, based on the number of employees: $25,000 (for 8-14 employees), $50,000 (for 15-100 employees), $100,000 (for 101-200 employees), $200,000 (for 201-500 employees) and $300,000 (for more than 500 employees). The caps apply nonpecuniary damages including future pecuniary loss, emotional pain and suffering, inconvenience, mental anguish, loss of enjoyment of life and other nonpecuniary losses. The caps do not apply to back pay, interest on back pay, front pay or equitable relief;
     
  • Removing individual liability for supervisors and other agents under the THRA for unlawful discriminatory acts of an employer;
     
  • Eliminating the separate common law cause of action for retaliatory discharge, and eliminating the requirement that the employee externally "blow the whistle" by reporting illegal activity to someone outside of the employer;
     
  • Immunizing private employers with fewer than eight employees from liability under the TDA. This means that both the TDA and THRA have the nine-employee threshold, but not the TPPA, which protects employees who have been subject to retaliatory discharge for reporting illegal acts;
     
  • Providing that an employee may not maintain an action under the THRA, TDA or the TPPA in state court while at the same time maintaining an action under the same "common nucleus of operative facts" in federal court.

Tennessee Equal Pay Act. The Act, which may be found at Tenn. Code Ann. § 50-2-201, et. seq., mimics the Equal Pay Act of 1963 in that it prohibits discrimination between employees in the same establishment, on the basis of sex, in their compensation for comparable work.

Polygraph Testing. The Tennessee Polygraph Examiners Act is found at Tenn. Code Ann. § 62-27-101, et seq. An employer cannot take personnel action against an employee based solely upon the results of a polygraph examination. Tenn. Code Ann. § 62-27-128. Additionally, federal law significantly limits the use of polygraph tests by employers.

False or Deceptive Hiring. It is unlawful to induce employment based on false or deceptive representations, false advertising, or false pretenses concerning the kind and character of the work to be done, or the amount and character of the compensation to be paid for such work, or the sanitary or other conditions of the employment, or as to the existence or nonexistence of a strike, or other trouble pending between employer and employees at the time of, or prior to, such engagement. Tenn. Code Ann. § 50-1-102.

Reporting Requirements. Employers are required to provide to the Tennessee Department of Human Services a report that contains the name, address, hire date and social security number of each newly hired employee. In addition, the report must contain the name, address and identifying number of the employer (assigned under Section 6109 of the Internal Revenue Code). Tenn. Code Ann. § 36-5-1101, et seq.

Employee v. Independent Contractor. In 2018, a new Tennessee law (HB 539) went into effect stating that a "marketplace contractor" of a "marketplace platform" is not an employee of the marketplace platform for all purposes provided there is a written agreement between the two and certain other conditions are met. The purpose of this statute is to protect certain online digital companies from utilizing workers as independent contractors rather than employees by excluding these workers from the usual rules according employee status. The terms "marketplace contractor" and "marketplace platform" are specifically defined in the statute. The presumptive effect of this law is to create a more favorable environment for the so-called "gig economy" companies to engage workers without incurring the expense and responsibility of employment.

Have Questions?
Let's Talk!

Click the button above to reach out to a
Baker Donelson L&E Professional.

Disclaimer: These materials do not constitute
legal advice and should not be substituted
for the advice of legal counsel.

Guide last updated July 2021.

Email Disclaimer

NOTICE: The mailing of this email is not intended to create, and receipt of it does not constitute an attorney-client relationship. Anything that you send to anyone at our Firm will not be confidential or privileged unless we have agreed to represent you. If you send this email, you confirm that you have read and understand this notice.
Cancel Accept