This is part 1 of a 2 part series. To read part 2, click here.
At the end of 2017, the New Hampshire Department of Labor (DOL) published its annual list of “Top 10 New Hampshire Labor Law Violations.” While the list does not change that much from year to year, it is a good opportunity to review pay and record keeping practices to ensure compliance with NH law.
The top violation is an employer’s “failure to pay all wages due for hours worked, fringe benefits, breaks less than 20 minutes, etc.” Employers often forget that “wages” can include vacation pay, severance pay, personal days, holiday pay, sick pay, and payment of employee expenses. To avoid any confusion, employers should have a written policy, acknowledged by employees, that states whether accrued unused vacation, sick, personal and/or paid time off days will be paid upon termination of employment.
The second most cited violation is an employer’s “failure to keep accurate record of all hours worked.” Simply put – it is the employer’s responsibility to keep accurate records of the hours that employees work and of wages paid to employees. This rule includes keeping track of the hours of non-exempt, salaried employees. Accurate records include notations for meal periods and for times when the employee leaves the workplace early. Records can be kept in paper format, via time clock and/or electronically. NH law requires that changes to an employee’s hours worked must be acknowledged in writing by the employee. If an employer uses an electronic system to keep track of hours worked, there must be a system in place for the employee to acknowledge changes to his/her hours worked. If that system includes an electronic signature verification program, then the employer must be able to prove that the employee only can access and use his/her electronic signature.
The third most cited violation is an employer’s “failure to provide written notice to employees of their wage rate, pay period, pay day and a description of fringe benefits, including any changes.” Many employers give the above information to newly hired employees orally. However, the law requires that employers not only provide this information in writing, but also update any changes to that information in writing.
The fourth violation is the “illegal employment of workers under 18 (not having property paperwork, hours violations, or working in a hazardous environment).” State and Federal laws are very specific as to the number of hours and type of work that are permissible, by age group. There is a mandatory fine for a violation – the DOL does not have discretion to reduce the fine.
The fifth violation is the “failure to pay 2 hours minimum pay at their regular rate of pay on a given day that an employee reports to work at the request of the employer.” If an employee reports to work as instructed by the employer and the employer sends him/her home for any reason within 2 hours of reporting to work, the employee must be paid for 2 hours work. In the case of inclement weather, employers should have a system in place to alert employees before they come into work that they are not required to report to duty, thereby avoiding the obligation to pay the 2 hour minimum.
These top 5 violations can be fairly easily avoided with an understanding of the nuances of the rules. It is well worth taking the time now to revisit pay and record keeping practices!