Getting Your Final Paycheck

Posted on Tuesday August 06, 2024

In recent months, many people throughout California have lost their jobs or had work placed on hold. As the economy slowly restarts, some business owners might decide to permanently reduce their workforce or close their doors permanently. In addition, some people might decide they need to quit their jobs to stay home with children who no longer have childcare or to avoid risks of illness. 

No matter how your employment ends, it is important that you properly receive your final paycheck. California law has strict requirements for this, and employers who fail to provide final payment as required should be held accountable. Never hesitate to seek help from a California employment law attorney.

Final Paycheck Requirements in California 

Labor laws in California require employers to provide final pay as follows:

• If someone is terminated, pay must be provided on the same day the employment was terminated
• If someone quits, the employer has 72 hours to provide the final paycheck

The final paycheck must include wages for all time worked, reimbursement for business expenses, as well as the cash value of benefits, such as vacation time not taken. The above requirements apply even if a business is closing its doors.

What if You Do Not Receive Your Final Check?

The California Department of Industrial Relations (DIR) takes the requirements for final pay very seriously. If you do not receive your pay on the day you were terminated or within 72 hours of quitting, you are entitled to penalties for your waiting time. The penalties equal one day’s worth of pay for each day your employer is late with your final paycheck. This is in addition to the wages, business expenses, and compensation for paid-time off that you already deserve. 

For example, an employee who earns $20 per hour and works eight hours a day would typically receive $160 for a day’s wages. The employer terminated the employee and did not provide the final paycheck for ten days. This means that the employee could recover their final pay, as well as ten days’ worth of wages ($1,600) for the waiting time penalty.

As you can see, these penalties add up quickly. The maximum penalty that an employer faces to an employee is 30 days of wages. The above employee’s penalties would cap out at $4,800 if the employer was a month late or later with the final paycheck. It is important that employees who are denied their final check in a timely manner have the right attorney who knows how to seek both their earned pay and the penalties they deserve. 

When and Where an Employee Should Get Paid

Under California law, employers are required to provide employees with their final paycheck promptly. When an employee resigns or is terminated, they must receive their final paycheck on their last day of employment. If an employer fails to provide the final paycheck on time, they may be subject to penalties and additional compensation for the employee.

In terms of where an employee should receive their final paycheck, it can either be handed directly to them at their workplace or mailed to their mailing address. However, if an employee provides written authorization, the employer can deposit the final paycheck directly into their bank account.

Penalties an Employer Can Face If They Don’t Pay Accordingly

Employers who fail to provide employees with their final paycheck on time may face penalties and additional compensation. According to the California Labor Code, if an employer willfully withholds an employee’s final wages or fails to pay within the required time frame, they may be penalized with “waiting time” penalties. These penalties can amount to one day’s wages for each day the wages remain unpaid, up to a maximum of 30 days.

Additionally, if an employer fails to provide accurate itemized wage statements along with the final paycheck, they may be subject to penalties. Wage statements must include details such as the employee’s hourly rate, hours worked, deductions made, and the total wages earned.

Possible Deductions from a Final Paycheck

While employers are required to pay employees their final wages, there are certain deductions that may be legally taken from the final paycheck. These deductions include:

Taxes and Other Statutory Deductions

Employers are required to withhold state and federal taxes, as well as other mandatory deductions such as social security and Medicare. These deductions are necessary to fulfill tax obligations and ensure compliance with legal requirements.

Deductions for Loans and Advances

If an employee owes the employer money due to loans or cash advances, the employer may deduct the outstanding amount from the final paycheck. However, any deductions must comply with state and federal laws and be documented properly.

Deductions for Unreturned Property

If an employee fails to return employer-owned property, such as keys, uniforms, or electronic equipment, the employer may deduct the cost of replacing those items from the final paycheck. Again, it is crucial for employers to adhere to legal requirements when making such deductions.

Final Paycheck FAQs

If you’ve recently left your job or are planning to do so, you probably have a lot of questions about your final paycheck. As San Diego employment attorneys, we’ve compiled a list of the top 9 frequently asked questions we hear about getting final paychecks in California:

1. When should I receive my final paycheck? According to California law, an employer must give you your final paycheck within 72 hours of your last day of work. However, if you give at least 72 hours notice before quitting, your employer must pay you on your last day.

2. What should be included in my final paycheck? Your final paycheck should include all wages owed for the hours you worked, any accrued vacation time or paid time off, and any other agreed-upon compensation, such as bonuses or commissions.

3. Can my employer withhold my final paycheck? No, your employer cannot legally withhold your final paycheck. If they do, they may be in violation of California labor laws.

4. What should I do if my employer doesn’t pay me on time? If your employer fails to pay you on time, you may take legal action against them. It’s important to consult with an experienced San Diego employment law attorney to understand your rights and options.

5. What happens if my employer gives me a final paycheck that bounces? If your employer pays you with a check that has insufficient funds, they are responsible for paying you immediately upon notification or realization that your check bounced. Contact your employer and inform them of the situation, and if necessary, consult a labor law attorney for further guidance.

6. What if I still have company property when I leave my job? If you still have company property when you leave your job, your employer has the right to deduct the value of the property from your final paycheck. However, they must provide you with a detailed itemization of these deductions.

7. Can my employer subtract money from my final paycheck for things like uniform replacements or other expenses? Generally, no. Deductions from your final paycheck for things like uniform replacements or other expenses are not permitted under California law unless you have previously agreed in writing.

8. What happens if my employer refuses to pay me altogether? If your employer refuses to pay you altogether, you may file a wage claim with the California Labor Commissioner’s Office or pursue legal action with the help of an attorney. It would be very similar to filing a lawsuit against your former workplace.

9. Can I still receive my final paycheck if I am fired? Yes, if you are fired, your employer is required to provide you with your final paycheck on your last day of work.

7 Common Final Paycheck Problems

Sadly, employees do get cheated from time to time when it comes to their final paychecks. These are the most common problems we encounter as attorneys practicing California employment law:

1. Late Payment: This is far too common. Remember, employers who fail to pay final wages on time may be subject to penalties.
2. Missing Paycheck: If your employer fails to provide a final paycheck, they are in violation of California labor laws. Don’t be intimidated if this happens!
3. Unpaid Overtime: If an employer fails to include overtime pay in the final paycheck, it is essential to seek legal advice. You deserve to be paid for every minute worked.
4. Unlawful Deductions: Employers cannot make unauthorized deductions from an employee’s final paycheck. Check over your paycheck line by line.
5. Inaccurate Wage Statements: Employers must provide accurate itemized wage statements with the final paycheck. Again, double check the line by line details on your paystub.
6. Refusing to Pay Unused Vacation Days: If you have accrued unused vacation days, your employer must pay them out along with your final paycheck. This is the law!
7. Final Paycheck Bouncing: It is illegal for an employer to provide a final paycheck with insufficient funds; legal action may be necessary in such cases. Whether it was unintentional or not, you must be paid for the time you worked.

Contact a California Employment Law Attorney Right Away

When you lose (or quit) your job, you still have your housing payment, utilities, and other bills to worry about. Having your final paycheck in a timely manner is essential moving forward. The Mara Law Firm helps employees obtain the wages and penalties they deserve from their former employers. Call (619) 234-2833 or contact us online for a consultation today.