Labor and Employment Law Overview: North Dakota
Federal law and guidance on this subject should be reviewed together with this section.
- North Dakota employers are prohibited from discriminating against employees on the basis of a variety of factors. See Unlawful Discrimination.
- North Dakota Labor-Management Relations Act provides employees with certain collective bargaining rights. See North Dakota Labor-Management Relations Act.
- Employers may not retaliate against employees who report violations of the law. See Whistleblower Protection.
- There are exceptions to North Dakota's the minimum wage requirements. See Minimum Wage.
- A 30-minute meal period must be provided to employees under certain circumstances. See Meal and Rest Periods.
- State law governs when an employee should receive his or her final paycheck and whether the employee must be paid any accrued, but unused paid time off. See Payment of Wages Upon Separation From Employment.
- Under North Dakota law, small employers are required to provide continued health care benefits to certain employees. See Continuation of Health Coverage.
Key North Dakota Employment Laws
North Dakota has key employment laws affecting the employer-employee relationship. Below, HR professionals will find a summary of certain laws they are most likely to encounter. It is important that HR professionals understand state law and how it interacts with applicable federal laws.
Interplay Between State and Federal Law
Employers are responsible for complying with both state and federal executive orders, statutes, regulations and other legal requirements. Often, state and federal legal requirements will address the same subject matter and impose varying compliance obligations on the employer. For instance, federal law may impose a higher minimum wage rate than state law. Alternatively, state law may require employers to retain certain records for a longer time period than federal law. Unfortunately, employers cannot select which law they want to comply with. Instead, employers that are covered by both state and federal law must comply with both. As a general rule of thumb, complying with the law that offers the greatest possible rights or benefits to the employee will ensure the employer meets its compliance obligations.
Employers may not discriminate against employees or applicants on the basis of the following:
- National origin;
- Age (40 or over);
- Mental or physical disability;
- Status with respect to marriage or public assistance;
- Participation in lawful activity off the employer's premises during nonworking hours that is not in direct conflict with the employer's essential business-related functions; or
- Opposition to workplace discrimination.
Employer refers to in-state employers that employ one or more individuals for more than one quarter of the year. It also refers to employers that employ one or more employees whose services are to be performed (partially or entirely) in the state - even if the employer is located outside of the state.
Equal Pay for Equal Work Required
Under Minnesota law, it is unlawful for employers to discriminate against employees on the basis of gender, by paying one gender at a lower rate than it pays another for comparable work with comparable requirements in terms of skill level, responsibility and effort. The law does not prohibit pay differentials that are based on nondiscriminatory systems the employer may have in place, such as:
- Merit based increases; or
- Executive level training programs.
The North Dakota Labor-Management Relations Act
Under the North Dakota Labor-Management Relations Act (the Act), employees have the right to:
- Self organize;
- Form, join or assist labor organizations;
- Collectively bargain through their representatives; and
- Engage in lawful concerted activity to bargain collectively or for other mutual aid.
The Act also provides employees with the right to refrain from engaging in the conduct above.
Nepotism Not Permitted in Certain State Jobs
There are laws prohibiting nepotism (i.e., the hiring of certain relatives) by some state officials and employees, as well as some county and city officials.
Employers may not discharge, discipline, threaten, discriminate, or penalize an employee regarding the employee's compensation, conditions, location, or privileges of employment for the following reasons:
- The employee, or person acting on the employee's behalf, in good faith, reports a violation of federal, state or local law, ordinance, regulation or rule to an employer, a governmental body or law enforcement official;
- The employee is asked by a public body or official to participate in an investigation, a hearing or an inquiry; or
- The employee refuses an employer's order to perform an action that the employee believes violates a local, state or federal law, ordinance, rule, or regulation. The employee must, however:
- Have an objective basis in fact for that belief; and
- Inform the employer that the order is being refused for that reason.
State child labor laws place restrictions on the type of work a minor can perform and limitations on the hours of work. For instance, minors under 14 years old are, generally, prohibited from working except in certain occupations such as in domestic service jobs, farm work or work for the minor's parent, guardian or grandparent. Similarly, minors who are 14 or 15 years old may only work in certain occupations or with an employment certificate signed by the minor's parent or guardian.
North Dakota's minimum wage is $7.25 per hour. There are certain exceptions to the state's minimum wage requirements. Some examples are:
- Volunteers (conditions apply);
- Student trainees (conditions apply); and
- Employees of nonprofit camps (conditions apply).
Overtime must be paid at one-and-one-half times the employee's regular pay rate for hours worked over 40 in any workweek. Some exemptions and different rules apply for categories of workers.
Meal and Rest Periods
A minimum 30-minute meal period must be provided to employees who work shifts exceeding five hours when there are two or more employees on duty. Employees do not have to be paid for meal periods if both of the following criteria are met:
- They are completely relieved of their duties during the meal period; and
- The meal period lasts at least 30 minutes.
Other breaks are not required by law, but if they are offered by the employer, they must be paid breaks.
Payment of Wages
Employees must be paid at least once each calendar month on the regular payday(s) designated by the employer. Regular paydays should be designated in advance. Each pay period, employers must provide employees with a check stub or voucher indicating:
- Hours worked;
- Rate of pay;
- Required state and federal deductions; and
- Authorized deductions, if any.
Legal deductions from wages include the following:
- State and federal withholdings required by law;
- Payroll advances that are documented; and
- Court ordered deductions, if applicable.
Employers must obtain the employee's written authorization for all other payroll deductions.
Payment of Wages Upon Separation From Employment
Unpaid Wages or Compensation
Unpaid wages or compensation become due and payable at the regular payday(s) established in advance by an employer when an employee:
- Is terminated from employment;
- Separates from employment voluntarily; or
- Is suspended from work as the result of an industrial dispute.
When an employer terminates an employee, the employer must pay the employee's wages by certified mail at the address designated by the employee, or that has been agreed upon between the employer and the employee.
Earned Paid Time Off
Once paid time off is made available for an employee's use, any unused portion of that time:
- Is considered wages upon separation from employment; and
- Must be paid at the regular rate of pay earned by the employee prior to separation.
An employment contract or policy may require an employee to take vacation by a certain date or lose the vacation (i.e., "use it or lose it"), provided that the employee is given a reasonable opportunity to take the vacation. The employer must demonstrate that the employee had notice of such contract or policy provision.
Thus, it is best practice for employers to have a written vacation or paid time off forfeiture policy and communicate that policy to employees in the employee handbook or by some other means. Employers should also place a cap on paid time off or vacation days and limit the number of days an employee may carry over from one year to the next.
If, however, an employee separates from employment voluntarily, a private employer may withhold payment for accrued paid time off under the following circumstances:
- At the time of hiring, the employer provided the employee written notice of the limitation on payment of accrued paid time off;
- The employee has been employed by the employer for less than one year; and
- The employee gave the employer less than five days' written or verbal notice.
Continuation of Health Coverage (Mini-COBRA Law)
Employers with less than 20 employees are exempt from the federal Consolidated Omnibus Budget Reconciliation Act (COBRA). Under state law, however, eligible individuals who worked for employers that have less than 20 employees may elect to continue their health care benefits for up to 39 weeks.
There are no developments to report at this time. Continue to check XpertHR regularly for the latest information on this and other topics.