Employers in New Hampshire, like other U.S. states, must know the state labor laws and the federal regulations. Among essential compliance requirements is the New Hampshire overtime law, which mandates that all employees receive fair compensation for overtime.
This article provides a comprehensive overview of the various laws and regulations regarding overtime in New Hampshire. The aim is to help employers ensure legal compliance and foster fair work practices that align with state and federal laws. Here, we are about to discuss the basics of overtime laws, minimum wage requirements, calculation for payment of wages, and and exemptions.
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New Hampshire Overtime Laws: Basics for Employers
There is no particular New Hampshire overtime law, and the state follows the federal guidelines in deciding the regulations for overtime work. Following the Fair Labor Standards Act (FLSA), the state mandates that all employees receive overtime pay for hours over 40 in a workweek at a rate not less than one and one-half times their regular pay rate.
Employers in New Hampshire must review the FLSA guidelines on overtime pay and frame their policies to comply with the requirements. While employees must be paid for overtime hours, who is eligible for overtime and how it is calculated depends on different factors.
Next, we will look at these requirements.
Who is Entitled to Receive Overtime Pay as per New Hampshire Overtime Law
Most hourly employees in New Hampshire are entitled to overtime pay. However, there are exemptions, such as certain administrative, executive, and professional employees, who may be exempt under specific criteria set by the FLSA. These employees are exempted based on their job description or earnings, which is predominantly according to the guidelines set by the FLSA.
Generally, most hourly workers are non-exempt and entitled to overtime pay. That’s why employers need to classify employees to avoid legal issues correctly. Misclassification can lead to costly lawsuits and penalties.
Salaried Employees May Be Eligible for Overtime
Given the definitions of the overtime regulations as per FLSA, it is common for employers to classify all salaried employees as exempt from overtime. However, certain salaried employees are eligible for overtime. Employers must be aware that overtime eligibility is not solely determined by whether an employee is salaried or hourly but by the nature of their job responsibilities and salary level.
For instance, a salaried employee earning less than a specified threshold (minimum $7.25 per hour) may still be eligible for overtime under the New Hampshire overtime law. This threshold is subject to periodic updates, so employers should monitor any changes in the law. Therefore, employers in the state must carefully assess the duties and compensation levels of their salaried employees to determine their overtime eligibility.
Minimum Wage and Regular Payment of Wages
In New Hampshire, as of 2024, employers must pay the minimum wage as determined by the federal standard, set at $7.25 per hour. This wage rate applies to most employees, with specific rules for tipped employees, who must receive a base wage of at least 45% of the standard minimum wage.
Employers hiring tipped workers can pay a minimum wage of $3.27 per hour, provided their tipped employees regularly receive over $30 monthly in customer tips. The tips and the base wage must meet or exceed the standard minimum wage. You can refer to the New Hampshire Department of Labor site for complete details.
Importance of Timely and Regular Payment of Wages to Employees
New Hampshire law emphasizes the timely and regular payment of wages. Employers must ensure employees are paid within eight days of the week they perform the work. Additionally, in case of employment termination, compensation should be made within 72 hours if an employee is fired or quits with adequate notice or by the next regular payday if the employee quits without sufficient notice or is laid off.
New Hampshire Department of Labor (NHDOL) mandates that employees are paid weekly and not less frequently than monthly under any condition. In case of a dispute over the amount of wages, employers are required to pay the undisputed part while leaving the employee free to pursue claims for the balance
New Hampshire Overtime Law Summary
Overview of relevant state and federal statutes
New Hampshire’s overtime law is entirely based on the federal Fair Labor Standards Act (FLSA) statutes, with only one exception. According to the FLSA, employees younger than 20 can be paid below the set minimum of $7.25 per hour. However, under the New Hampshire overtime law regulations, employees younger than 16.
New Hampshire overtime rules
The FLSA mandates that employees must be paid overtime at a rate of at least one and one-half times their regular rate for hours worked beyond 40 in a workweek. New Hampshire overtime law aligns with this federal mandate.
Employers must ensure that their overtime policies align with the federal and local overtime laws. It’s also crucial to be aware that any updates in federal laws might necessitate changes in their payroll practices.
When federal overtime rules apply
Overtime eligibility in New Hampshire predominantly follows the guidelines set by the FLSA. As per federal law, non-exempt employees generally include hourly workers, both full-time and part-time employees.
If you are not employing white-collar workers such as executive, administrative, or professional roles, you probably hire employees entitled to overtime pay. Ensure to refer to the FLSA guidelines to decide if an employee meets specific criteria related to their job duties and compensation to be exempted. Employers need to classify employees to avoid legal issues correctly. Misclassification can lead to costly lawsuits and penalties.
Do not take the exemption of statutes as an indication that all salaried employees under the New Hampshire overtime law are exempted. The nature of the job and salary determines if a salaried employee is eligible for overtime.
If the employee’s responsibility does not involve overlooking at least one employee, making management or administrative decisions, or specialized skills, then such an employee may be eligible for overtime. Additionally, any salaried employee earning less than that minimum wage, irrespective of their job description, will be eligible for overtime. Therefore, employers must carefully assess their salaried employees’ duties and compensation levels to determine their overtime eligibility.
Exemptions from federal overtime laws
While New Hampshire’s overtime laws largely mirror the FLSA, it is essential to recognize all state regulations, such as the age limit for minimum wage in New Hampshire being 16 and not 20, as set by the FLSA.
Employers are responsible for understanding and implementing overtime laws for fair compensation. This requirement involves maintaining accurate records of hours worked and wages paid, correctly classifying employees, and ensuring that eligible employees receive the appropriate overtime compensation.
Overtime Entitlement and Calculation Methods
According to New Hampshire overtime laws, all non-exempt employees are entitled to overtime pay. It requires that employers should correctly classify employees for overtime calculation. The exempted employees include:
- Seasonal employees working for amusement or recreational establishments
- Administrative Staff
- Executives
- Outside sales workers
- Computer-related fields
- Jobs require specialized skills
The overtime rates in New Hampshire are as per the FLSA, which is $7.25 per hour. However, employees can pay lower than minimum wage to tipped employees, provided they earn different monthly tips.
Let’s take a look at overtime calculations for different employees.
Overtime calculation for tipped employees in New Hampshire
Tipped employees in New Hampshire customarily and regularly receive more than $30 per month in tips. As per the state law, such employees can be paid a base wage of 45% of the regular minimum wage, around $3.27 per hour.
However, employers must ensure that while calculating overtime, the regular hourly rate for a tipped employee should be considered the standard minimum wage, not the reduced base wage. Employers can use the tip credit system to calculate overtime hours for tipped employees.
Overtime calculation for salaried employees in New Hampshire
If salaried employees are not exempt, overtime pay calculation is straightforward. Such employees are paid 1.5 times their regular wage rate for hours more than 40 over a work week. In simple terms, their overtime payment will be:
40 hours x regular wage rate + Hours over 40 x (1.5 x regular wage rate)
Overtime calculation with commission in New Hampshire
For calculating overtime for employees who receive an hourly wage plus commission in New Hampshire, here’s the formula:
{((Total hours x Hourly Rate) + Commission) / Total hours} / 2
Suppose an employee earns $15 per hour, works 45 hours a week, and earns a commission of $200. Their new regular pay will be:
($15/hour x 45 hours) + $200 commission = $875
To determine the regular pay rate: $875 / 45 hours = $19.44 per hour.
But they will be paid at half this rate, so $19.44 per hour / = $9.72 per hour.
Hence, for their extra 5 hours, they will earn $9.72 x 5 = $48.6.
Specific considerations for overtime in the Healthcare industry
Employers in the healthcare sector can use the “8 and 80” rule for overtime calculations. As per this rule, employees are entitled to overtime pay for hours worked over 8 in a single day or 80 in a 14-day work period, whichever is greater. The Fair Labor Standards Act (FLSA) approves this method for hospitals and residential care establishments that may adopt a 14-day work period instead of the typical 7-day workweek.
Use of compensatory time as an alternative to overtime pay
In New Hampshire, public sector employers can offer employees compensatory time, also known as “comp,” instead of overtime pay. The comp time is offered as additional time off instead of overtime pay for working extra hours. However, private-sector employers cannot use compensatory time as an alternative to overtime pay.
In the case of public sector employers, too, employees should be in a collective bargaining agreement with the employer to receive compensatory time.
Exceptions and Exemptions in New Hampshire Overtime Laws
New Hampshire’s overtime laws generally follow the FLSA exceptions and exemptions. These exceptions often apply to specific job categories or industries:
- Agricultural workers
- Seasonal employees
- Executives
- Administrative
- Professional employees making at least $684 per week
Misclassification of Independent Contractors
A prevalent issue in overtime law compliance is misclassifying employees as independent contractors. However, some employers do it to avoid paying social security taxes, workers’ compensation, and overtime pay.
Employers need more than just simply labeling an employee as an independent contractor or even entering into a written agreement to avoid significant legal repercussions for employers. Proper classification requires satisfying all the requirements of a 1099 employee.
Impact of Payroll Deductions on Overtime Calculations
Payroll deductions can only be implemented if determined by the New Hampshire overtime law or written agreement. During overtime pay calculation, employers must provide a written statement of all deductions made, such as insurance premiums, donations, unemployment taxes, etc.
Legal Compliance and Enforcement
Requirements for Wage Payments
New Hampshire labor law mandates employers to adhere to wage payment regulations, which include providing detailed pay statements and pay stubs. These instruments must clearly outline the hours worked, wages earned, and any deductions made.
Regulations Concerning Meal and Rest Breaks for Employees
New Hampshire law requires employers to provide 30-minute meals and rest breaks for employees if they are working for more than five consecutive hours. If employers cannot allow time off because of the nature of the work, employees should be paid as they are working and eating simultaneously.
Understanding the Statute of Limitations for Unpaid Overtime Claims
Employees can take legal action against an employer by filing claims for unpaid overtime in non-compliance. New Hampshire agrees with the FLSA guideline that mandates that an employee can file a claim within 2- 2 years from the date of overtime law violation by the employer. However, this statute can be extended to 3 years if the violation by the employer is wilful.
Penalties for Violations of New Hampshire Wage and Overtime Laws
Violations of wage and overtime laws in New Hampshire can result in significant penalties, including double the amount of unpaid back wages plus attorneys’ fees incurred by employees.
Responsibilities of Employers Regarding Layoffs, Plant Closings, and WARN Notice
In layoffs or plant closings, the Worker Adjustment and Retraining Notification Act (WARN) is applied to New Hampshire employers, requiring them to inform their employees 60 days in advance about plant closing or mass layoffs.
Case Studies and Examples
We can look at the McCarthy v. Medicus Healthcare Solutions, LLC case to better understand the implications of violating New Hampshire overtime law.
The employee, James McCarthy, sued his employer, Medicus Healthcare Solutions (Medicus), for not paying him overtime wages. He claimed his employer made him work 40 hours a week without proper overtime wages. Furthermore, Medicus maintained records of approved overtime work and pay but not of “off-the-clock” hours.
The court ruled that the employer was in wilful violation of the overtime law.
Lessons learned here are:
- Employers refusing overtime compensation knowingly can be tried as wilful violators of the FLSA.
- Such offense can result in up to 3 years of overtime back wages.
How can Truein help with Overtime Pay management?
Truein is a cloud-based, hardware-less time and attendance management solution that offers robust overtime pay management tools. It simplifies the tracking and calculating overtime hours, ensuring compliance with legal requirements and reducing manual errors. You can customize Truein to adapt to various overtime policies, and it integrates with existing HR systems to provide a seamless management experience. It ensures accurate payroll processing and maintains clear and precise records for audits and compliance checks. Learn more about Truein’s features and benefits in managing overtime pay.
Conclusion
To ensure fair and lawful employment practices, employers and employees understand New Hampshire overtime law. Adhering to these regulations is essential for employers to avoid costly legal disputes and maintain a harmonious workplace environment. Tools like Truein can streamline overtime pay management processes, further facilitating compliance with state and federal laws.
