Employer of Record for Pennsylvania

Guide to Hiring Employees in Pennsylvania

Your guide to hiring employees in Pennsylvania, covering employment and labor laws, payroll, benefits, onboarding and taxes. You can also manage and pay your contractors in Pennsylvania through Playroll.

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Capital City

Harrisburg

Timezone

EST

(

GMT-5

)

Paid Leave

None

Income Tax

3.07%

Employer Tax

10.37%

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How to Hire Employees In Pennsylvania

Hiring in Pennsylvania for the first time can be challenging, especially with the state's complex employment laws. Whether you're hiring independent contractors, setting up a legal entity, partnering with a PEO, or using an Employer of Record (EOR), it's essential to understand the local employment landscape. Playroll's comprehensive guide is here to help, whether you're onboarding local talent or relocating team members.

Here are four primary ways companies can hire employees in Pennsylvania:

  • Establishing a local entity: Creating a legal entity in Pennsylvania allows for direct hiring, but it can be costly and time-consuming. However, it gives you full control over employment and reduces risk exposure.
  • Partnering with an Employer of Record (EOR): An EOR, like Playroll, takes on the legal responsibilities of employment, acting as the employer on your behalf. This option streamlines hiring, payroll, and compliance with Pennsylvania’s labor laws, helping you hire in Pennsylvania without navigating the complex legal landscape yourself.
  • Working with a Professional Employer Organization (PEO): A PEO, such as Playroll, co-employs your team, managing essential HR functions like payroll, benefits, and compliance. Partnering with a PEO ensures you meet Pennsylvania’s labor regulations while offering competitive employee benefits.
  • Hiring independent contractors: Hiring independent contractors can be more cost-effective, but Pennsylvania has strict contractor classification rules. Proper classification is essential to avoid penalties for misclassification when hiring in Pennsylvania.

Complying with Pennsylvania specific employment regulations and federal laws is critical to avoiding legal risks and costly fines. Our guide focuses on hiring in Pennsylvania, employment compliance, and how Playroll’s services can support your business as you navigate the complexities of hiring in the state.

Good To Know

Pennsylvania is not a right-to-work state, meaning union membership can be a condition of employment in unionised workplaces.

Known for its steel, manufacturing, and healthcare industries, Pennsylvania has a diverse labour market, particularly strong in Pittsburgh and Philadelphia.

Some local jurisdictions impose additional earned income and occupational privilege taxes, so employer withholdings may vary by location.

Key Things to Know About Hiring in Pennsylvania

Do I need an EIN or Payroll Tax Number to Employ in Pennsylvania

Yes, if you plan to hire employees in Pennsylvania, you’ll need an Employer Identification Number (EIN) from the IRS. This number is required to report federal employment taxes and fulfil other federal requirements. Additionally, employers in Pennsylvania must register with the Pennsylvania Department of Revenue and the Department of Labor and Industry to obtain a payroll tax number. This state tax number is used for reporting and remitting state unemployment insurance (UI) tax and state withholding taxes.

Working Hours in Pennsylvania

In Pennsylvania, standard working hours are typically 40 hours per week for full-time employment, though there is flexibility based on employer policies. The state mandates overtime pay for hours worked over 40 per week at a rate of 1.5 times the regular pay rate. However, there are no legal limits on daily working hours unless specific safety regulations apply. Federal regulations restrict the employment of minors, including limits on the number of hours they can work and prohibitions on hazardous work.

What is considered full-time employment in Pennsylvania?

While Pennsylvania does not have a legal definition of full-time employment, the threshold commonly recognized by employers is 35–40 hours per week. This aligns with federal guidelines, but specific criteria may vary depending on the employer and the benefits tied to full-time status.

Probation Period in Pennsylvania

Pennsylvania employment law does not mandate a probation period for new hires. Probationary periods are typically determined by the employer and used as an evaluation phase, but they are not legally required or regulated by the state.

Pennsylvania Employment Laws for Hiring

Minimum wage in Pennsylvania

The current minimum wage in Pennsylvania is $7.25 per hour, in line with the federal minimum wage. 

Pennsylvania Anti-Discrimination Laws

Pennsylvania’s anti-discrimination laws prohibit discrimination based on race, color, religion, national origin, sex, disability, age (40 and older), and genetic information. State laws also protect against discrimination based on marital status, pregnancy, and, in some localities, sexual orientation and gender identity. These laws apply to hiring, firing, promotions, and other employment practices. Complaints can be filed with the Pennsylvania Human Relations Commission (PHRC) or the federal Equal Employment Opportunity Commission (EEOC).

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Onboarding New Hires in Pennsylvania

We can help you get your new employee started in Pennsylvania fast, with a minimum onboarding time from just 1-2 working days. Note that the timeline is dependent upon registration with the local authorities, and begins after the employee has submitted all the required information on the Playroll platform.

For non-citizens of the US, a work eligibility assessment may be required, and can add three extra days to the onboarding time. If a follow-up is needed, there may be additional delays.

Please note that payroll cut-off dates can impact the actual first day of employment. Playroll’s payroll cut-off date is the 10th of the month, unless otherwise specified.

Payroll Services For Pennsylvania

In general, employees are paid semi-monthly and monthly. Should the payment date be semi-monthly, the employer must make the salary payment within 10 days of the end date of the pay period.

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Overview of Employment Taxes in Pennsylvania

In Pennsylvania, employers must contribute to several types of employment taxes to ensure compliance with both state and federal requirements. 

Employer Tax Contributions Pennsylvania

Employment Tax Type Tax Rate
Unemployment Insurance applied on salary up to $10,000.00 annually. 1.42%-10.37%
Unemployment- New Employer (state), applied on salary up to $10,000.00 annually. 0.0007
FICA Social Security (federal) As per federal legislation
FICA Medicare (federal) As per federal legislation
The FUTA (Federal Unemployment Tax Act) Reduced by 5.4% to 0.6% due to state uninsurance contributions

Employee Payroll Tax Contributions

Employee Payroll Tax Contribution Tax Rate
Unemployment (state) 0.0006
Unemployment- New Employer (state), applied on salary up to $10,000.00 annually. 0.062
FICA Social Security (federal), applied on salary up to $168,000 annually. As per federal legislation
Additional tax on earnings over $200,000 0.009

Tax Due Dates in Pennsylvania

In Pennsylvania, the deadline for filing individual state income tax returns aligns with the federal deadline, typically on April 15. If April 15 falls on a weekend or federal holiday, the deadline is extended to the next business day.

Pension in Pennsylvania

Not mandatory for private sector employers. 

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The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in Pennsylvania tailored to your needs.

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Benefit Requirements for Employers in Pennsylvania

Employers must navigate both federal laws and specific state regulations when offering benefits.

Are employers required to provide health insurance in Pennsylvania?

Under the Affordable Care Act (ACA), employers with 50 or more full-time equivalent employees must provide health insurance to their full-time employees or face potential penalties. Employers with fewer than 50 full-time equivalent employees are not obligated to offer health insurance but may choose to do so to attract and retain talent.

Do part-time employees get benefits in Pennsylvania?

No law mandates that employers provide benefits to part-time employees. Offering benefits such as health insurance, paid time off, or retirement plans to part-time staff is at the employer’s discretion. However, if benefits are offered, employers must adhere to the terms of their established policies or employment contracts.

Are employers required to offer 401k in Pennsylvania?

There is no federal or state law requiring employers to offer 401(k) or other retirement plans. The choice to provide such benefits is voluntary and often based on an employer’s desire to remain competitive in the job market. If a retirement plan is offered, employers must comply with the Employee Retirement Income Security Act (ERISA) and other regulations to ensure proper management and fiduciary responsibility.

Employers not bound by specific mandates can still benefit from offering comprehensive packages to attract and retain skilled talent.

It’s Easy To Manage Benefits For Employees In Pennsylvania With Playroll

Paid and Unpaid Leave Policies in Pennsylvania

Is vacation leave mandatory in Pennsylvania?

Vacation leave is not mandatory in Pennsylvania, but if an employer provides it, they must adhere to their policy or employment agreement. Payment for unused vacation upon termination is only required if specified in the employer’s policy.

What are Mandatory Leave Entitlements in Pennsylvania?

Type of Leave Time Period Mandatory Pay Status Eligibility Criteria
Annual Leave Discretionary by employer No Unpaid Determined by employer policy
Maternity Leave As stipulated by federal FMLA legislation Mandatory under FMLA Unpaid As stipulated by federal FMLA legislation
Paternity Leave As stipulated by federal FMLA legislation Mandatory under FMLA Unpaid Same as FMLA eligibility for maternity leave
Sick Leave Discretionary by employer; up to 12 weeks (under FMLA) Not mandatory (unless under FMLA) Typically unpaid unless specified in policy As stipulated by federal FMLA legislation
Military Leave Duration of service Mandatory under USERRA Unpaid Applies to all employees in uniformed services
Jury Duty Duration of jury Mandatory Unpaid All employees called to jury duty are eligible
Parental leave As stipulated by federal FMLA legislation Mandatory under FMLA Unpaid As stipulated by federal FMLA legislation
Bereavement Leave Determined by employer policy Not mandatory Determined by employer policy Determined by employer policy
Voting Leave No specified time by law Not Mandatory Unpaid unless specified by employer Encouraged if work hours conflict with polling times

Paid Time Off in Pennsylvania

PTO is not mandated by state law, so employers are not required to provide paid or unpaid vacation or personal days. If offered, PTO must follow the employer's policy or contract terms.

Maternity Leave In Pennsylvania

In Pennsylvania, there is no state-mandated maternity leave. Employees rely on the federal Family and Medical Leave Act (FMLA), which provides unpaid, job-protected leave for eligible employees to care for a newborn, adopted child, or newly placed foster child. If FMLA doesn’t apply, any maternity leave would depend on the employer’s policies. Some companies may offer paid maternity leave voluntarily as a benefit.

Paternity Leave In Pennsylvania

In Pennsylvania, there is no state-mandated paternity leave. Eligible employees may qualify for unpaid, job-protected leave under the federal Family and Medical Leave Act (FMLA) to care for a newborn, adopted child, or newly placed foster child. If FMLA doesn’t apply, any paternity leave would depend on the employer’s specific policies, as Pennsylvania law does not provide additional leave requirements for paternity.

Sick Leave In Pennsylvania

State law does not require paid sick leave, but FMLA  may be utilised for job-protected unpaid leave in instances such as a serious health condition or to care for an immediate family member with a serious health condition. Certain cities, like Philadelphia and Pittsburgh, require paid sick leave for some employers.

Military Leave in Pennsylvania

Federal law (USERRA) provides unpaid leave and job protection for employees in the armed forces, including the National Guard and Reserves, ensuring reemployment rights upon return from service.

Jury Duty in Pennsylvania

Employers must provide unpaid leave for jury duty and cannot penalize employees for serving. While pay is not required, employers must not retaliate for jury service.

Bereavement Leave

No legal requirement for employers to provide leave; policies depend on the employer.

Voting Leave

No specific legal requirement for time off to vote, though employers are encouraged to allow time if work schedules conflict with polling hours.

Employment Termination Protocols in Pennsylvania

Termination Process in Pennsylvania

Pennsylvania operates under the "at-will" employment doctrine, meaning employers can terminate employees for any reason, at any time, without prior notice, as long as the reason is not illegal. Conversely, employees can also resign without reason or notice. 

Notice Period in Pennsylvania

There is no legal requirement for employers to provide a notice period before terminating an employee. However, under the federal Worker Adjustment and Retraining Notification (WARN) Act, employers with 100 or more employees must provide 60 days' notice before a mass layoff or plant closure affecting 50 or more employees.

Severance in Pennsylvania

Pennsylvania law does not require employers to provide severance pay upon termination. Severance agreements are typically governed by the terms of the employment contract or company policy.

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FAQS

FAQs About Hiring In Pennsylvania

What is the minimum wage in Pennsylvania?

As of January 1, 2024, Pennsylvania’s minimum wage rates are:

  • $7.25 per hour.
  • Applies across all sectors.

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