It is a frustrating and even alarming situation: You log in to your bank account to find that your latest paycheck is less than it should be. So you look at your pay stub and see that your employer deducted money for some vague reason.
Can they do that?
The short answer is: It depends. For working people in California, the law strictly limits what employers can deduct from paychecks. All other deductions are a form of wage theft that takes money out of your pocket. Fortunately, you have the power to fight back.
At Justice Law Corporation, we help working people across the state ensure that they are fully paid and take action when they are shortchanged. Our California wage and hour attorneys focus exclusively on representing employees and their families. We combine decades of experience with a strong track record of successful results.
Under California law, employees are entitled to receive all wages they have earned. Employers generally cannot make deductions from paychecks unless the deduction is specifically authorized by law or falls within a recognized exception. The purpose of these protections is simple: employers should bear the normal costs and risks of operating a business.
If something does not look right on your paystub, do not brush it off. You have the right to ask questions. You also have the right to take action to get the unpaid wages that you earned.
Here is what you need to know.
What Employers Can Deduct From Paychecks
Some paycheck deductions are required by law. Others may be permitted based on the circumstances.
Common lawful deductions include:
- Federal income taxes
- Social Security and Medicare taxes
- Court-ordered garnishments
- Child support obligations
- Employee-authorized benefit contributions
- Union dues
- Retirement plan contributions
- Health insurance premiums
These deductions are generally disclosed to employees and appear on pay stubs.
Employers can also make deductions to recover overpayments. If your employer accidentally puts an extra $250 in your paycheck, for example, it can take that money back by deducting it from future paychecks. It may have to recover the overpayment in installments, depending on the circumstances.
What Employers Cannot Deduct From Paychecks
Some deductions that are common in certain industries – and even permitted in other states – are banned in California. Often, whether a deduction can be made in these situations depends on the specific circumstances.
Employee Mistakes
Employers cannot deduct money from an employee’s wages because the employee made a mistake.
This includes situations in which a customer leaves without paying, a cash register comes up short, inventory disappears, or equipment is damaged. Simple errors and accidents are part of the cost of doing business, which must be borne by employers rather than their workers.
The situation changes if the mistake results from dishonesty, willful misconduct, or gross negligence by an employee. A worker who intentionally steals from their employer, for instance, can be forced to make repayment through paycheck deductions.
Uniforms
Here is the rule in California: If your employer requires you to wear a distinctive uniform, beyond generic clothing that you could wear elsewhere, they generally have to pick up the tab.
Your employer cannot deduct the cost of a required uniform from your paycheck. They also cannot make you buy the uniform out of your own pocket. This is a business expense that the employer must absorb.
Employers are also on the hook for any special care uniforms require, such as dry cleaning, ironing, and any upkeep beyond a normal home wash-and-wear.
So, what counts as a uniform? It has to be specific and distinctive. More generic clothing items, like black pants and a plain white shirt with no logo, typically are not considered uniforms under the law. That is because they can be used for other purposes. When employers require less common or more specific colors, distinct logos, or styles, they cross into uniform territory.
The same goes for equipment, like required tools, company devices, and protective gear. Your employer generally needs to cover the costs for equipment that it requires you to use to do your job.
Training Costs
Employers not only have to cover related training costs but also pay employees for their time. If your employer requires you to complete training as a condition of the job, that is generally treated as compensable work time, meaning you should be paid your regular wage for the hours spent in it.
Employers also generally cannot require workers to repay training costs if they leave their jobs within certain short timeframes.
Employers routinely argue that they should be able to claw back these costs from workers who jump from job to job quickly. But repayment agreements can trap people in their jobs when quitting comes with significant financial penalties.
There is a small exception for certain education opportunities that are truly optional and benefit employees beyond their jobs. If your employer helps to pay for a certification or outside course that is not required for your job, for instance, it may force you to pay that money back if you agreed to do so. The key question is usually whether the training was required for the job or genuinely optional and for your own advancement.
Our California Wage and Hour Attorneys Can Help
If you believe that you are being shortchanged on the job, whether it is through paycheck deductions or in other terms and conditions, you do not need to go it alone. A California wage and hour attorney at Justice Law Corporation can help you evaluate your claim and take action.
Contact us at (818) 230-7502 to schedule a free consultation with a California wage and hour attorney.
