The End of an Employer/Employee Relationship
Published 03/20/08

The end of any relationship is difficult. However, unlike those complex moments at the end of a romantic relationship where you are left wondering if you will ever get your favorite sweater back, the end of the employee/employer relationship is governed by New Hampshire 's Wage and Hour Laws. So, while your ex may see fit to keep your sweater, an employer is not entitled to keep benefits that belong to an employee. In fact, according to New Hampshire law when a worker leaves the employment of an employer, the employee is entitled to the prompt payment of all “wages.”

The Wage and Hour statute defines wages as “compensation … for labor or services rendered by an employee, whether the amount is determined on a time, task, piece commission or other basis of calculation.” However, other benefits, such as vacation pay, personal days, holiday pay, or sick days are considered wages when they become due if they are a matter of an employer's employment practice or policy.

For example, if your employer's policy is that you get two weeks vacation at the beginning of each calendar year, and you leave your job without using those two weeks, they are properly considered “wages”. If on the other had you accrue your vacation over the course of a year, only the portion of your vacation that has accrued at the time you left your job would be considered “wages”.

New Hampshire law RSA 275:44 provides that when an employer fires an employee prior to a scheduled payday, the employer has 72 hours to pay your wages. If on the other hand you are the one who walks out – quitting or resigning from your job – your employer has until the next regular payday to pay your wages. However, if you give your employer at least one pay period worth of notice before you quit/resign then your employer has to pay all wages within 72 hours. For example, if you get a paycheck every two weeks, and you give your employer two weeks notice, you are then entitled to your paycheck within 72 hours of your last day. If you disagree with your former employer as to the amount of wages you are due, the employer is required to pay whatever amount they concede they owe within the time limits laid out above. You can cash the check, and may pursue the remaining amount you believe is owed.

Such disputed amounts may be pursued either through the New Hampshire Department of Labor or directly by the employee through the Courts. If successful, you may also recover costs and attorney's fees from your former employer.

If your former employer willfully and without good cause fails to pay you your wages as described above, then you are entitled to what are called liquidated damages. This is a fancy way of saying that you get money above and beyond what is owed you.

According to the New Hampshire 's Wage and Hour Laws, an employer is liable for an additional 10% of the wages owed, per day (excluding Sundays and holidays) to a maximum penalty of 100% of the wages owed. That means if you are successful in an action against your former employer, and the employer has willfully and without good cause withheld your wages for ten days or more, you get double what you are owed. It is important to note that an employer acts willfully and without good cause only if they have the ability to pay wages, know they owe the wages and yet voluntarily does not pay the wages. If your employer has a bona fide belief that they are not obligated to pay, there can be no liquidated damaged.

An interesting side note to this liability is that the officers and agents involved in the management of a corporation can be held personally liable for failing to pay timely wages where such officers or agents knowingly permit the corporation to violate the wage laws discussed above. A typical situation occurs where a manager is upset that an employee has moved onto a new job, perhaps with a competitor, and out of spite the manager endeavors to withhold wages that they know are due the former employer, often a commission or a bonus. Another situation to look out for is when your boss encourages you to work without pay because the company cannot afford to pay you. He may be liable for your wages if the company does not ultimately pay and could conceivably be liable for double that amount.

The long and short of it all is that when a relationship comes to an end there may be hard feelings, and the end of the relationship between an employer and employee is no exception. Fortunately, New Hampshire 's Wage and Hour laws give guidance to both parties. As with any conflict, the issues are not always clear, and the best advice is to seek legal council.

Jon D. Garbarino is an associate attorney at Hamblett & Kerrigan, P.A. His legal practice includes employment law, personal injury and family law. You can reach Attorney Garbarino by e-mail at:jgarbarino@hamker.com

This information is general information and may not reflect the most current legal developments, verdicts or settlements. The information provided should not be relied upon as an indication of the actual state of the law or of future developments. The information contained on the Hamblett & Kerrigan website is for informational purposes only and does not constitute legal advice. If the information referenced may be of legal importance to you, you should consult with an attorney to provide you with legal guidance and opinion as the the effect of the current law upon your situation.