labor lawAdivision of labor law center

The New Hampshire Department of Labor in Concord has issued an employer alert regarding direct deposit.

 

The New Hampshire Department of Labor has received a number of complaints that employers are requiring direct deposit and/or pay cards for payroll. This is not legal, under New Hampshire law. Every employer must offer a check for payment of wages at no cost to the employee, if requested. In addition, the check must be on a financial institution convenient to the place of employment. Employees must be able to cash their paychecks and receive the full amount of payment due. In other words, the nearby financial institution may not charge a fee for cashing the checks.

 

New Hampshire employers may opt to offer direct deposit and authorized pay cards as payment. However, they cannot require that employees use one of these payment methods. Every employee is entitled to payment by payroll check, if he or she prefers.

 

Under RS 275:43, employers must pay workers in cash. An acceptable alternative is a payroll check drawn on a nearby bank, or a payroll check with arrangements to cash it at no charge at a nearby bank. However, offering payment only by direct deposit or paycard is a violation of the state wage payment law.

 

The same law requires that New Hampshire employers pay workers within 8 days after the end of the payroll week, unless another payment arrangement is approved in advance by the New Hampshire Labor Commissioner.

 

If paycards are used, the employee must have a tleast one free means to withdraw the full amount – with no fee – on the card. Again, the place of withdraw must be convenient to the place of employment. The law specifically states that “none of the employer’s costs associated with a payroll card or payroll card account shall be passed on to the employee.”

 

For more information, contact the New Hampshire Department of Labor at 603-271-0127.

 

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