Unlike Maine, New Hampshire’s legislature has not directly addressed
accidental overcompensation of an employee by an employer. However, the
Legislature and the New Hampshire Department of Labor have indirectly addressed
this scenario by restricting an employer’s ability to withhold any portion of an
employee’s wages.
The circumstances under which a New Hampshire employer may make a
deduction from an employee’s wages are identified in RSA 275:48.
Specifically, an employer is not permitted to withhold or divert any portion of
an employee’s wages unless (1) a federal or state law requires or permits the
deduction; (2) an employee authorizes the employer in writing to make a
deduction for a lawful purpose accruing to the benefit of the employee; or (3)
the employer makes a deduction pursuant to any rules or regulations for medical,
surgical, or hospital care or service, without financial benefit to the
employer.
The New Hampshire Department of Labor has further elaborated on, and
possibly limited, an employer’s ability to withhold an employee’s wages.
In its rules, the Department of Labor has specified the deductions which an
employee may authorize in writing as the following: installment payments of
legitimate loans by the employer to the employee; union dues; health, welfare
pension and apprenticeship fund contributions; voluntary charity contributions;
housing and utilities; savings funds held by someone other than the employer;
voluntary rental fees for non-required clothing; voluntary cleaning of uniforms
and non-required clothing; and an employee’s use of a demonstrator vehicle
pursuant to statute. Notably, this list is written as exhaustive and does
not include reimbursements to employers for overcompensation.
Significantly,
even the New Hampshire Supreme Court has recently recognized that RSA 275:48
precludes employers from engaging in "self-help" to recover money they believe
they are owed by an employee. See Fowler v. Town of Seabrook, 765 A.2d
146, 145 N.H. 536 (2000). Despite the Court’s recognition of RSA 275:48 as
limiting an employer’s ability to withhold an employee’s wages, the Court failed
to provide employers with any guidance for recovery.
Accordingly, New
Hampshire employers must proceed with caution when attempting to recover
overcompensation from employees. An employer should recognize that its
ability to withold an employee’s wages is subject to statutes and
regulations. At a minimum, a New Hampshire employer should obtain written
authorization from the employee before making any deduction not otherwise
authorized by law from the employee’s paycheck. However, the lack of
clarity on this issue indicates that employers should seek guidance from the
Department of Labor prior to making such a deduction, even with written
authorization.
