Employee NOT cashing his paychecks!
Bossita 1 Post
Hello, New to this forum...Hope someone can help. I have an employee who is not cashing his paychecks. Presently there are 9, totaling $5,808.00! He says the government takes the money out of his account. (I'm already garnishing his wages for child support, so I don't know who is doing that...) I have suggested cashing his checks and immediately getting cashiers checks or money orders made out to himself, I've suggested cashing the checks and burying the money in the ground somewhere, I've even offered to give him a locking box. It's a huge and expensive hassle. He keeps the checks in envelopes in his truck, which predictably was stolen last year creating an expensive headache for us to determine which checks were stolen and then replacing them. Of course the taxes had already been paid on them, the Child Support garnishments get paid weekly. I know I can't NOT pay him, I know I can't charge him for every uncashed check (tempted, believe me!) I don't know what my recourse is. I'd fire him if he wasn't so valuable in our business.
You cannot generally force an employee to cash his/her paychecks, spend his money wisely or pretty much anything else in this arena. In Iowa, if the employee was hired after July 1, 2005, the employer may require direct deposit of wages. So the employee would have to have a bank account and checks would be automatically “cashed.” However, given the time at issue here it might be difficult to go back several years after hire and require direct deposit unless you made this a companywide policy. Direct deposit policies vary by state and would need to be checked if you employ in states other than Iowa. Iowa also allows payment by debit cards, which might be another solution, but again would have to be companywide policy. State law may also allow you to refuse to replace a lost check after a certain period of time (say 90 days) or charge a replacement fee for any lost check. Such fees should not drop an employee below minimum wage.