insufficient funds

Can you deduct monies from an employees check for NSF checks they have written on the company? and what type of a percentage of their check can you deduct?


  • 7 Comments sorted by Votes Date Added
  • I don't know if this falls into any specific loophole via the banking world and NSF, but to deduct from a paycheck, you must have their signed permission in writing for an exact amount and to be safe, I'd put in a schedule for deducting as well ($x per paycheck, or all in one swoop, etc.) Can't drop them below minimum wage, either, so if they don't make much above that, you don't have much wiggle room.

    And, as you well know, California is screwy, so hopefully someone will weigh in if their laws are more stringent.
  • Other than banking and NSF, which I don't know anything about, the basic Ca. rule is that you cannot deduct for things that could be considered a cost of doing business. One cannot depend on "negligence" either, because it could be a mistake, a cost of doing business. I don't know how this plays in what you describe, but I don't think that this could reasonable be called a cost of doing business.
  • We do have the employees sign an authorization for deductions for monies owed for NFS and I know the minimum wage requirement. We were just wondering if there are any other restrictions IE a percentage break down on how much can be taken at a time.

    Thanks for the feed back so far
  • I'm not sure I understand what you mean. Did the ee give the employer a check that bounced? In any event, although it may arguably be challenged when an employer dings an employee's paycheck for money the ee owes, I have never heard of the ee challenging it. So, based on the odds, I recommend always dinging their paycheck if they owe you money. This is not intended to suggest you ding them for all sorts of silly notions, just money they owe you like not returning tools, not properly balancing and accounting for advance expense funds, absconding with uniforms, not repaying a company loan, etc.
  • [font size="1" color="#FF0000"]LAST EDITED ON 06-29-05 AT 04:05PM (CST)[/font][br][br]Sounds good, but some of which you describe would be viewed as a business loss in California and cannot be deducted from an employees check. Further, is the employee is a terminating employee, unpaid loan balances cannot be deducted. The employer has the same right to the employees money as any other creditor and the same means of recovery - they can't just glom onto the cash.
  • Which of the several I mentioned specifically would be viewed in Mexifornia as a 'business loss'?
  • We are a bank also. However we never deduct funds from an employees paycheck due to insuffieiences. We have a program within our progressive disciple policy for such matters. So many INSF's and you go to step 1, 2, etc... If it is not cleared up, we force close their account and it could result in their termination if they do not work with us to fix this problem.
    I know of a small bank near us that when you have your first INSF you get to meet their president and explain how this happened and how it will never happen again. If you have a second you get to meet the president to tell him how much you enjoyed working there. Seems a bit harsh but...

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