Employment and labor laws in South Dakota [Updated 2024]

Navigating employment and labor laws can be daunting for employers. The laws exist to help ensure fair treatment and safeguard employee rights, and while federal laws provide a national baseline, states often have unique regulations of their own. South Dakota, the Mount Rushmore State, is no exception. South Dakota's laws are moderate compared to other states; they’re neither lax nor stringent.

Employers in the state of South Dakota must understand both federal and local employment regulations. South Dakota law, for instance, may have unique wage rates or wage laws that differ from neighboring states—which we’ll explore below.

Need help navigating South Dakota's labor and employment laws? Supercharge your business growth by allowing Rippling's Professional Employer Organization service to manage your tax registration and management so you can focus on what you do best: growing your business.

Employment vs. labor law: What’s the difference?

It's a common misconception that employment and labor law are the same thing. Despite both having to do with the workplace, they focus on different aspects—primarily, the parties involved.

Here’s what we mean:

• Employment law focuses on the relationship between an employer and an individual employee, plus factors like work hours, remuneration, overtime, recruitment, protection against workplace bias, and ensuring a retaliation-free environment.
• Labor law has to do with the dynamics between employers and collective entities, such as unions, including factors like union affiliation, membership dues, and collective bargaining agreements.

Wages and hours in South Dakota

While federal guidelines, like the Fair Labor Standards Act (FLSA), provide a foundation on wages and hours, the South Dakota Department of Labor gets even more specific about payday rules and the cost of living adjustments in the state.

Minimum wage in South Dakota

On January 1, 2024, the minimum wage in South Dakota increased from $10.80 per hour to $11.20 per hour, which is higher than the federal minimum wage of $7.25.

The state allows for cost of living adjustments based on a formula tied to the Consumer Price Index. If the federal minimum wage rate increases, South Dakota's minimum wage will adjust accordingly.

When defining hourly wages for your workforce, Rippling automatically flags minimum wage violations based on the states where employees live—which is particularly helpful in states like South Dakota, where the minimum wage is set to change. 

Overtime pay in South Dakota

In South Dakota, employees receive 1.5 times their regular rate of pay for every hour worked beyond 40 hours in a workweek.

South Dakota excludes certain workers from its minimum wage and overtime provisions, including agricultural employees, outside salespersons, and people employed in a bona fide executive, administrative, or professional capacity.

Stay compliant with South Dakota overtime laws with Rippling’s payroll software. Rippling automatically applies the correct pay rates when an employee’s hours trigger overtime pay requirements.

Pay transparency in South Dakota

While the nationwide movement for pay transparency has been gaining momentum, South Dakota doesn’t have its own law yet. One was introduced during the 2023 legislative session that would have required employers to include hourly or salary ranges in all job postings for new positions, transfers, and promotions, but it didn’t pass.

Rippling's Headcount and Compensation Bands tool automatically flags out-of-band adjustments during onboarding, so special cases get your attention and approval, while others can be blocked as needed.

Breaks and rest periods in South Dakota

South Dakota employment laws don’t require employers to provide breaks, including lunch breaks. But while they aren’t required, many employers still offer a short break or lunch period.

Minors between the ages of 16 and 17 are required to have a 30-minute rest period if they work five or more consecutive hours.

Leaves of absence in South Dakota

Many people may need to take time off from work at some point, whether it’s due to health reasons, family emergencies, or other significant life events. In the US, federal law protects employees’ jobs during certain types of leave. Here's what you need to know about leaves of absence in South Dakota.

South Dakota follows the federal guidelines in the Family and Medical Leave Act (FMLA). This means eligible employees can take up to 12 weeks of unpaid leave each year for reasons like personal or family illness, family military leave, the birth, adoption, or foster care placement of a child, and more.

Vacation leave

Under the Fair Labor Standards Act (FLSA), there's no requirement for paid leave, but employers often offer vacation or sick leave as part of the employment contract. 

Jury duty leave

In South Dakota, employers can’t fire, threaten, or coerce employees because they serve as jurors. However, the state doesn't require employers to pay employees for time spent on jury duty.

Pregnancy disability leave in South Dakota

In South Dakota, while there is no specific state law mandating Pregnancy Disability Leave (PDL), pregnant employees are protected under federal legislation such as the Pregnancy Discrimination Act (PDA) and the Family and Medical Leave Act (FMLA). These laws ensure that pregnant workers receive the same rights and protections as employees with other medical conditions:

• Pregnant employees, under the PDA, must be treated the same as other temporarily disabled employees for all employment-related purposes.
• Eligible employees can take up to 12 weeks of unpaid FMLA leave for the birth of a child or to care for a newborn child. This leave can also be used for the adoption or foster placement of a child.

Paid sick leave in South Dakota

South Dakota doesn’t have a state-mandated Paid Sick Leave (PSL) law. However, businesses often offer PSL as part of their benefits package. Here's what you should know:

• If offered, employees typically utilize their PSL for personal illnesses, doctor's appointments, to care for an ill family member, or, in certain cases, for issues related to domestic violence or health emergencies.
• The amount of PSL provided, if any, is often based on company policy, the length of the employee's service, and other related factors.

Rippling allows you to automate and customize your leave policy, giving you full visibility into how employees are utilizing it.

Workplace safety in South Dakota

Every employer in the state of South Dakota should prioritize workplace safety. The South Dakota Department of Labor offers guidance—it's not just a matter of good faith; it's a legal requirement.

Workplace safety in South Dakota largely mirrors the guidelines set by OSHA at the federal level. However, there are a few nuances specific to the state:

• South Dakota doesn’t have an approved state plan, which means that the federal OSHA regulations are the primary workplace safety laws in effect.
• Employee protections in South Dakota include:
• The right to request an inspection if they believe there are unsafe or unhealthy working conditions
• Protection against any form of retaliation for reporting safety concerns
• The right to receive information and training about potential hazards in their language
• While some states require businesses to have a written safety and health management program, known as an Injury and Illness Prevention Program (IIPP), South Dakota doesn’t. However, it’s still a good practice to have one in place.

Rippling PEO offers a convenient pay-as-you-go workers’ comp plan that doesn’t require you to pay upfront for the whole year. This allows you to scale your business stress-free in South Dakota and anywhere else in the US.

Discrimination and harassment laws in South Dakota

In South Dakota, employees have the right to work in an environment free from discrimination and harassment. South Dakota's laws concerning discrimination and harassment largely mirror federal regulations. Namely, it’s illegal to discriminate against employees based on certain protected characteristics, including:

• Race or Color
• National Origin
• Sex (including pregnancy, childbirth, or related medical conditions)
• Religion
• Age (although this isn’t covered under South Dakota law, federal law prohibits this)
• Disability
• Genetic Information

Harassment is any unwelcome behavior or conduct based on the above protected characteristics. Examples include derogatory comments, unwanted advances, or exclusion from work-related activities. It's essential for employers to understand that not every unpleasant interaction qualifies as harassment. There needs to be a pattern or severity that creates a hostile work environment.

Under South Dakota law, if an employer violates discrimination laws, the employee may be entitled to relief, like getting lost wages paid back. The employer may also have to undergo specific training or implement changes in policy.

Although sexual harassment training requirements can vary by state, South Dakota doesn’t mandate specific sexual harassment training for employees. 

Employers aiming for best practices will still want to ensure that their workforce is well-informed about the importance of maintaining a respectful workplace. Rippling’s Learning Management System is pre-loaded with core sexual harassment training courses, ensuring each employee meets state requirements based on where they live.

Unions in South Dakota

A union is a group of workers who come together to collectively negotiate their terms of employment, like pay, work hours, and working conditions. This process of negotiation is called "collective bargaining."

When in a union, employees have rights under federal law, including:

• The right to join or not join a union without facing any repercussions
• The right to be represented by a union
• The right to collectively bargain for better working terms
• The right to engage in collective activities, like strikes, for mutual aid and protection

It's illegal for employers to threaten or retaliate against an employee based on their decision to support or not support a union. Employers can’t make promises of benefits to discourage union support, nor can they prohibit employees from soliciting for a union during non-work hours.

In South Dakota, labor union participation and collective bargaining are considered essential rights of the workforce. South Dakota is also a right-to-work state, meaning employees can’t be compelled to join a union or pay union dues as a condition of employment.

FAQs about South Dakota labor and employment laws

Are independent contractors covered under South Dakota employment laws?

No, independent contractors are generally not covered under South Dakota's employment laws. They are considered self-employed and are responsible for their own taxes, benefits, and other employment-related issues. However, it's crucial to classify workers accurately; misclassification can lead to legal repercussions.

Does at-will employment exist in South Dakota?

Yes, South Dakota is an at-will state. This means that either the employer or the employee can terminate the employment relationship at any time, for any reason, as long as it's not illegal or discriminatory.

What privacy rights do employees have in South Dakota?

In South Dakota, employees have the right to privacy concerning their personal information. Employers are generally not allowed to disclose personal or confidential information without the employee's consent unless required by law.

Are background checks legal in South Dakota?

Yes, employers in South Dakota can conduct background checks on potential employees. However, employers must obtain written consent from the individual before performing the check and must adhere to federal regulations such as the Fair Credit Reporting Act (FCRA).

Are whistleblowers protected in South Dakota?

Yes, whistleblowers in South Dakota are protected from retaliation if they report violations of state or federal laws by their employers. 

Is workers’ compensation coverage required in South Dakota?

While there isn’t a law in South Dakota that requires it, it is highly recommended that employers provide workers' compensation coverage for their employees. Workers’ comp ensures that workers receive benefits for work-related injuries or illnesses.

Are there required healthcare benefits in South Dakota?

South Dakota employers aren’t mandated by state law to provide healthcare benefits to their employees. However, businesses with 50 or more full-time employees are subject to the Affordable Care Act's provisions on a federal level.

Are South Dakota employers required to provide bereavement leave?

South Dakota doesn’t have a specific law mandating bereavement leave. Employers may offer it as part of their benefits package, but it's typically at their discretion.

What employee protections are available in South Dakota if layoffs occur?

While there’s no specific state law governing layoffs, South Dakota employers are required to comply with the federal Worker Adjustment and Retraining Notification (WARN) Act if they meet certain criteria. The WARN Act requires advance notice of significant layoffs to give employees time to find alternative employment or receive necessary training.

Disclaimer: Rippling and its affiliates do not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.