Deductions from An Employee’s Pay Check – General Prohibition against Employer “Self Help”

In California, employers generally have no right to withhold or deduct any part of the employee’s wages except in specific, limited situations, including:

  • If a law permits or requires deductions (e.g. income taxes, social security, Medicare, etc.).
  • If the employer can prove that the employee’s dishonesty, willful misconduct or gross negligence caused the loss, damage or shortage to the employer.
  • If the deduction is authorized in writing, and the money is conveyed to a third party for the benefit of the employee (e.g. health insurance premiums, 401K payments).

An unresolved issue is whether an employer can unilaterally – and without the employee’s specific agreement – withhold wages to recover an employee debt, such as a loan or an advance to purchase equipment. One court stated that an employer cannot accelerate the debt payment and collect the balance on the debt in one lump sum from the employee’s final paycheck.

An interesting dilemma arises for an employer who accidentally overpays an employee. The employer can deduct the overpayment from the employee’s next paycheck only if the employee authorizes the specific deduction in writing. If the employee does not agree, then an employer is required to comply with California’s garnishment and attachment laws and cannot engage in ‘self-help’ to the employee’s wages.

Read more

unpaid wage lawyer

Walgreens employees win $4.5M settlement in bag check lawsuit

Over the years, several California employers have been sued for not paying employees for time spent on bag checks before or after work. A judge recently approved a $4.5 million settlement in…

READ ARTICLE
overtime violation attorney

Oakland judge OKs $78M overtime settlement for air medical company workers

California medical flight crew employees sued their employer, a medical helicopter company, for missed breaks and overtime violations. Now, the employees are set to receive a $78 million settlement that amounts to…

READ ARTICLE
age discrimination lawyer

Using COVID-19 layoffs as a pretext for age discrimination is unlawful

The COVID-19 pandemic has created difficulties for businesses everywhere. More and more companies have resorted to layoffs to reduce their workforce in light of the economy’s downward spiral. Given the current situation,…

READ ARTICLE
age discrimination attorney

Fired executive accuses IMAX of replacing older workers with younger ones

California and federal laws protect employees from being fired or discriminated against for unlawful reasons, such as on the basis of their age, sex, disability, race or national origin. Employment violations can…

READ ARTICLE
SEEN ON
cnnmoney
marin-ij
dailypost
news10