Every year the New Hampshire Department of Labor issues a list of the top ten violations found by its inspection division in the previous year.  Remarkably, the list does not change much from year to year.  The culprits move up and down and switch places, but the same mistakes seem to be made in perpetuity.

Photo: Sam Churchill via Flickr (CC by 2.0)
Photo: Sam Churchill via Flickr (CC by 2.0)

It is hard to know why.  Seminars, webinars, articles and blog posts like this by employment lawyers and human resources organizations are available on almost a daily basis.  The Department of Labor itself holds frequent informational sessions at convenient locations throughout the state.  Most of the laws and regulations have been in place for years, and even the oldest are frequently violated.

Why are employers having difficulty getting it right and which employers are they?  I don’t pretend to have the answers which is why I pose this as more of a rhetorical question.  Are the violators primarily those without professional human resources staff?  Not necessarily.  Are the companies with the most violations those who have in house employment counsel and HR in out of state locations, individuals who  might not have familiarity with NH laws?  Maybe some, but not all.  Are those responsible for compliance simply overwhelmed with their daily responsibilities such that technical compliance suffers?  Perhaps, but the risk of non-compliance is high.

Regardless, for those who need a refresher, here is 2014’s top ten list:

10.  Failure to Pay Minimum Wage for All Hours Worked.  This is unlikely to be the result of employers not knowing the minimum wage or intentionally paying less.  This violation is most likely to arise with employees who are paid a salary and treated as exempt when they should be paid by the hour, non-exempt inside sales employees paid by commission who don’t earn sufficient commissions in each week or even individuals improperly characterized as interns and paid little or nothing.

9.  Illegal Deductions from Wages.  There are very specific rules in RSA 275:48 and at Lab 803.02 regarding what can be deducted from wages.  Failure to comply is serious.  Deducting for the cost of damaged, lost or unreturned company equipment, for example, is prohibited.

8.  Illegal Employment of Workers Under 18 (not having proper paperwork, hours violations, hazardous work).  Youth employment violations are among the most serious in the eyes of the DOL.  Employers should be fully familiar with the requirements for appropriate documentation in advance of work commencing and the significant restrictions on what young workers can do and when.

7.  Failure to Pay 2 Hours Minimum Pay at the Regular Rate of Pay on a Given Day That an Employee Reports to Work at the Request of the Employer.   In this past winter of snow days, power outages and early closings, this is likely to have  been a huge issue.  Employees scheduled to work who are sent home by the employer must be paid for two hours.

6.  Failure to provide WRITTEN notice to Employees of Their Wage Rate, Pay Period, Pay Day and a Description of Fringe Benefits, Including any Changes.  Written notice is required; the notice must be signed by the employee whether using an offer letter or the form conveniently located on the DOL website.  A new written notice is required with every change.

5.  Failure to Secure and Maintain Worker’s Compensation Coverage and Misclassification of Employees.  This violation arises most commonly not from the occasional lapse of coverage due to error, but from failing to cover the proper people.  Businesses should take great care to make certain that they properly characterize individuals as employees rather than independent contractors or “consultants” unless they truly meet the established criteria.

4.  Employment of Undocumented Workers Prohibited.  During wage and hour inspections the DOL will review all documentation related to an employee’s authorization to work in the US.  Lack of properly completed documentation on file will result in civil penalties.

3.  Failure to Have a Written Safety Plan, Joint Loss Management Committee and Safety Summary Form.  Pursuant to RSA 281-A:64 companies which employ at least 15 workers are required to comply with these safety requirements.

2.  Failure to Keep an Accurate Record of all Hours Worked.  It is the responsibility of the employer to make certain that an accurate record of the time worked by every non-exempt employee is kept.  The DOL does not accept a compilation of hours; rather each employee must on each day record the time their day starts, when they clock out and back in from a meal break, and when they leave for the day. If employees fail to punch in and out, the employer must address the issue.

AND the Number One Labor Law Violation for 2014….

Failure to Pay all Wages Due for Hours Worked ….

A violation of RSA 275:43 can be found for any number of reasons:  docking an employee for a break of less than 20 minutes, failing to pay an employee who takes a lunch break but remains on call or continues to answer the phone, not paying hourly employees who answer emails and phone calls at night from home, not having permission to pay employees less often than weekly.   The list goes on, and the minefields are everywhere.

From time to time every employer should consider a self-audit of its payroll practices…before the DOL decides to pay a visit.