Firing an employee over a compensation dispute may be costly
Under New Hampshire law, most employees are employees at will and means that they can quit or be fired with or without notice or cause. Even if the employee has an employment agreement which sets forth their compensation and perhaps other obligations related to confidentiality and non-solicitation of employees and customers and the like, the agreement often will reaffirm the employee-at-will relationship. The employee-at-will relationship has exceptions including violations of specific laws such as for example employment discrimination and whistleblowing. Further, the employee-at-will doctrine has a public policy exception. If the employee is able to prove the firing was motivated by bad faith, retaliation, or malice, and the employee was performing an action that public policy would encourage or refusing to something that public policy would condemn, the fired employee may have a wrongful termination claim against the former employer.
Over a year ago the New Hampshire federal trial court on October 30, 2017 in the case of Josh Fraize v. Fair Isaac Corporation denied Josh Fraize’s former employer’s request to dismiss the claim for wrongful termination, The employer asserted that even if Mr. Fraize was correct that he was fired because he challenged his employer’s interpretation of his employment compensation, since he was an at-will-employee he had no ability to file the suit. The trial disagreed and stated that question would be for a jury to decide under the public policy exception, noting it is illegal under New Hampshire law for an employer to withhold wages that are due the employee so challenging that illegal act could be doing something public policy would encourage.
In such wage disputes, employees may also be communicating between themselves about their frustration about their compensation and that could be considered what is called protected concerted activity under the National Labor Relations Act. Under that Act employers, whether union or non-union shop, should not take action against an employee for communicating with other employees about issues that are of common interest in the workplace such as their pay. Employees not only can communicate between themselves as to what they earn, but can also can complain to each other about how they feel the amount of compensation is unfair or perhaps how the employer’s interpretation of compensation is unfair. For example, sales people may complain amongst themselves as to a sales commission policy. It would be prudent before an employer decides to fire an employee because he disputes with the boss, or complains to co-workers, about the pay he is receiving that the employer speak with its employment attorney to ensure the firing does not expose the company to litigation exposure.
J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at email@example.com.