Take it from their pay?

Okay - I'm trying to find a resource/law or something that I can use to explain to my management that you cannot just take deductions from an employees pay without their authorization and it must be authorized for exact dollar amounts. Any suggestions?

Comments

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  • How about FLSA (Fair Labor Standards Act of 1938). Only with their specific written permission can one deduct anything from their pay. Now, most of us have been creative and figure out ways to get that written permission. The first piece of evidence is the letter of offer provided to the employee upon enrolling as an employee, which is then supported by a "wording in their letter of resignation" (should it apply), and thirdly, supported by a specific document which documents the "Accounts Receivable" set up by the accounting department when the individual becomes indebted to the company for anything. (loss tools, not returned uniforms, or damaged uniforms, pay advances, etc.)

    Therefore, it can be done, however, it must be documented and signed by the individual ee and HR.

    PORK
  • Can it be a blanket statement (i.e. the employee agrees to pay for any outstanding amount owed) or does it have to be the employee signing for a specific amount (i.e. employee agrees to $XX dollars)?

    Any wording I've seen from our local wage and hour division is vague and could be applied either way.
  • I have never put this in to practice myself, but I spoke to two Nebraska attorneys just a few weeks ago who said they have successfully defended "blanket statements" which the employer used to deduct. However, EVERYTHING I have seen on this forum has been contrary to that, recommending that you have an exact detailed list including dollar amounts (for equipment/supplies/whatever), have a schedule ($X over so many pay periods), and have them sign it.

    I put the following line on the signature page of our handbook -

    ______ I agree that (our company) can deduct funds owed by me to (company) from my paycheck.

    and then I have them initial in the blank, in addition to signing their name that they have read and understand the policies. My payroll clerk doesn't believe me that it is legal, though, so I don't know if she'd do it even if we wanted her to.
  • Perhaps there are state specific requirements? I've repeatedly learned at employment law seminars that an employee cannot sign away the ability to have a deduction taken from their wages for money owed to the employer UNLESS the debt has already incurred. For example, "now that you've lost xyz tool" it is ok to deduct from an employee's check with their written permission, but "in the event you ever lose xyz tool we will deduct..." is NOT ok. Maybe this is a MN thing...
  • There are state specific rules on this as well as FLSA. In South Carolina, you cannot garnish wages unless it is for child support or tax lien.

    We do have employees who are issued equipment (cell phones, laptops, etc.) that they agree they will return the equipment upon termination or the cost will be deducted from their final pay. In any event, you still cannot deduct their pay below what would qualify as minimum wage.

    I personally have a problem with employees "stealing" from the company and then the company not being able to recoup in their final pay. The same goes with salaried employees who go into negative PTO status and then terminate. I believe you should be able to recoup this from their final pay.

    Unfortunately, the law sees it otherwise!
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