Delaware is the second smallest state in the United States, both in terms of land area and population.
Payroll and Benefits Guide - United States - Delaware
Fun Facts
The state is often referred to as the “First State” because it was the first to ratify the United States Constitution on December 7, 1787.
The state’s capital is Dover, and its largest city is Wilmington.
Rehoboth Beach is known as the “Nation’s Summer Capital”.
The state hosts the annual Firefly Music Festival.
The state’s nickname is “The Diamond State”.
Contributions
Employee Payroll Tax
| Contribution Type | Rate |
| FICA Social Security (federal) | 6.20% |
| FICA Medicare (federal) | 1.45% |
| Additional tax on earnings over 200,000 USD | 0.90% |
Employer Payroll Tax
| Contribution Type | Rate |
| Unemployment Insurance (state) | 0.30% – 8.20% |
| Unemployment- New Employer (State) | 1.30% |
| FICA Social Security (federal) | 6.20% |
| FICA Medicare (federal) | 1.45% |
| FUTA (Federal Unemployment Tax Act) | 0.60% – 6.00% |
Payroll
Payroll Cycle
Employees are generally paid monthly, with payments due within seven days of the end of the pay period.
13th Salary
There are no legislations for 13th month payments in Delaware.
Work Hours and Week
The workweek is a maximum of 40 hours per week, 8 hours per day.
Overtime
Delaware adheres to the Fair Labour Standards Act (FLSA), and work in excess of 40 hours per week is considered overtime and paid at the rate of 150% of the regular pay. If employees are scheduled to work on weekends or rest days, no additional payment is required. However, should an employer request an employee to work in exceptional circumstances on these days, then overtime is paid at the rate of 150% of the regular pay.
Leave
Paid Time Off
Delaware does not have any state laws that govern paid time off. However, it is common for employers to decide whether to offer paid or unpaid vacation leave. This must comply with employment law and must be stipulated in the collective bargaining agreements.
Public Holidays
There are 12 public holidays in Delaware. Public holidays are not mandatory as paid days off, however, it is very common to allow workers to take federal holidays as paid days off.
Sick Days
It is common for an employer to follow the Family and Medical Leave Act (FMLA) which provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for certain family and medical reasons (maternity leave, serious illnesses or if the employee needs to care for a spouse or child). The Delaware Pregnancy Discrimination and Accommodation in the Workplace further enforces the protection of an employee and addresses the adaptations which should be made within the workplace. This act is applicable for employers with four or more employees.
Employees are eligible for FMLA if they have worked for their employer for at least one year, completed a minimum of 1,250 hours over the past year, and worked at a location where the company employs 50 or more employees within 75 miles.
FMLA eligible employees are entitled to:
- 12 working weeks of leave in any one year for a child’s birth and to care for the newborn child within one year of birth.
- Leave for the adoption or foster care of a child and care for the newly placed child within one year of placement.
- Care for the employee’s spouse, child, or parent who has a severe health condition.
- Leave in the event of a serious health condition that makes the employee unable to perform the essential functions of their job.
- Any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on “covered active duty.”
OR
- Twenty-six working weeks of leave during a single one-year period to care for a covered service member with a serious injury or illness if the eligible employee is the service member’s spouse, son, daughter, parent, or next of kin (military caregiver leave).
Maternity Leave
See Sick Leave above.
Paternity Leave
See Sick Leave above.
Parental Leave
See Sick Leave above.
Termination
Termination Process
Except in mass dismissals or as provided for in an employment contract or a collective bargaining agreement, U.S. law does not impose a formal “notice period” to terminate an individual employment relationship, and employment is stipulated “at will.” This means that either the employer or the employee may end the employment
relationship without giving either notice or reason, provided it is not illegal, notable discrimination on the grounds of a category protected by law, etc., and as per the Federal Worker Adjustment and Retraining Notification Act (WARN).
relationship without giving either notice or reason, provided it is not illegal, notable discrimination on the grounds of a category protected by law, etc., and as per the Federal Worker Adjustment and Retraining Notification Act (WARN).
The employment contracts of executives and other highly skilled individuals often incorporate a “just cause termination” clause which mandates that the employer may only terminate the employee for “cause” and lists the permissible grounds. In such cases, the parties negotiate the foundations for a “just cause” termination case-by-case.
Notice Period
In Delaware, most employees are employed “at-will,” and either party can terminate the employment relationship without notice. In Delaware, pay out of unused vacation time is not required by law. Still, generally, employers will pay an employee for unused vacation days, provided the employee gave some advanced notice of resignation; there is no official notice period. Still, in general practice, two weeks’ notice is a minimum requirement.
In mass dismissal cases the Worker Adjustment and Retraining Notification Act (WARN Act) must be followed, and employers must give 60 days’ notice to impacted employees.
Severance Pay
Except as otherwise provided in an employment contract or collective bargaining agreement, employers need not make severance payments to terminated employees. Employers who choose to offer severance would need to have the provisions within the employee’s contract and agreed by both parties. Many employers choose to offer severance payment linked to the employee’s length of service.
Probation Period
Probation Period
No legal provision governs a formal “trial/probation period.” However, it is common practice for employers to set a performance evaluation after an initially stated period of employment of 90 days.
Immigration
Foreign nationals without permanent resident status or a work visa are not permitted to work in the United States. An employer seeking to hire a foreign national may file a petition with the United States Department of Homeland Security/ United States Citizenship and Immigration Services (“USCIS”) for an employment visa on behalf of the prospective employee. If the petition is approved, the prospective employee must obtain a “visa stamp” from a United States embassy or consulate (Canadian citizens are exempt from this requirement). To get a temporary U.S. work visa, an employer must file a petition with U.S. Citizenship and Immigration Services (USCIS).
VAT
Delaware has a 0.00% standard GST Rate.