An employer can lawfully withhold amounts from an employee’s wages only: (1) when required or empowered to do so by state or federal law, or (2) when a deduction is expressly authorized in writing by the employee to cover insurance premiums, benefit plan contributions or other deductions not amounting to a rebate on the employee’s wages, or (3) when a deduction to cover health, welfare, or pension contributions is expressly authorized by a wage or collective bargaining agreement. Labor Code Sections 221 and 224.
It goes on and talks about the lawful deductions that they can take.
Although a wage garnishment is a lawful deduction from wages under Labor Code section 224, an employer cannot discharge an employee because a garnishment of wages has been threatened or if the employee’s wages have been subjected to a garnishment for the payment of one judgment. Labor Code Section 2929(a) (See How to file a discrimination complaint)
The state goes on to say below that even in the case of an overpayment or if the employee has a loan with their employer it is illegal for the employer to deduct this money from the final check even if the employee agreed to do so in writing!
The ability of an employer to deduct amounts from an employee’s wages due to a cash shortage, breakage, or loss of equipment is specifically regulated by the Industrial Welfare Commission Orders and limited by court decisions. (Kerr’s Catering v. Department of Industrial Relations (1962) 56 Cal.2d 319).In addition, there have been several court decisions that significantly restrict an employer’s ability to take an offset against an employee’s wages. Barnhill v. Sanders (1981) 125 Cal.App.3d 1, (Balloon payment on separation of employment to repay employee’s debt to employer is an unlawful deduction even where the employee authorized such payment in writing); CSEA v. State of California (1988) 198 Cal.App.3d 374 (Unlawful to deduct from current payroll for past salary advances that were in error); Hudgins v. Nieman Marcus (1995) 34 Cal.App.4th 1109 (Deductions for unidentified returns from commission sales unlawful.)
Some common payroll deductions often made by employers that are unlawful include:
| a. Gratuities. An employer cannot collect, take, or receive any gratuity or part thereof given or left for an employee, or deduct any amount from wages due an employee on account of a gratuity given or left for an employee. Labor Code Section 351 However, a restaurant may have a policy allowing for tip pooling/sharing among employees who provide direct table service to customers. b. Photographs. If an employer requires a photograph of an applicant or employee, the employer must pay the cost of the photograph. Labor Code Section 401 c. Bond. If an employer requires a bond of an applicant or employee, the employer must pay the cost of the bond. Labor Code Section 401 d. Uniforms. If an employer requires that an employee wear a uniform, the employer must pay the cost of the uniform. Labor Code Section 2802, Industrial Welfare Commission Orders, Section 9. The term "uniform" includes wearing apparel and accessories of distinctive design and color. e. Business Expenses. An employee is entitled to be reimbursed by his or her employer for all expenses or losses incurred in the direct consequence of the discharge of the employee’s work duties. Labor Code Section 2802 f. Medical or Physical Examinations. An employer may not withhold or deduct from the wages of any employee or require any prospective employee or applicant for employment to pay for any pre-employment medical or physical examination taken as a condition of employment, nor may an employer withhold or deduct from the wages of any employee, or require any employee to pay for any medical or physical examination required by any federal or state law or regulation, or local ordinance. Labor Code Section 222.5 If you would like more information on this or other related topics click on the link below. Click here to find out more! |
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