By: Nicholas J. Ferraro | March 15, 2023 | Employment Law
When you leave a job, it can be a stressful or exciting time in your life. Even if you are leaving for work you want to pursue, the changes and loss of familiar connections and places can be difficult. Leaving your current employment is worse if your employer fails to provide you with your final paycheck or gives you a paycheck with unfair deductions. It is essential that you understand the California final paycheck law.
As an employee, you deserve compensation for your work, and that includes everything you earned in your last paycheck.
California Wage Laws
In most cases, wages in California must be paid on a pre-established schedule of at least twice a month. The distribution of these paychecks is limited under state law to protect employees. There are also restrictions on the information that is shown on a paycheck. Termination pay, or final paychecks, are also highly regulated.
State Laws for Final Paychecks
California employment law states that employees receive final paychecks immediately. If an employee is fired or doesn’t have a say in leaving their job, they must be paid their final paycheck on the same day as termination. An employee who quits must be given their final paycheck within 72 hours of providing notice. If an employee gives notice more than 72 hours prior to their final shift, they must receive their paycheck on that day. If no notice is provided, the paycheck must be sent within 72 hours of their last day.
What Should Be Included in Your Final Paycheck
California law also covers what is required in a final paycheck. This includes:
- All wages
- All business expenses
- Any commission payments owed on top of base pay
- The cash value of all benefits accrued, including vacation, sick days, and paid time off
If your final check includes all these things, then your employer has properly compensated you, and the professional relationship between employer and employee has ended. If your termination paycheck fails to include these amounts, you may want to speak with an employment attorney.
What Is Deducted from a Final Paycheck?
Employers are only allowed to deduct or withhold specific things from your final paycheck. This includes:
- Standard state and federal tax deductions
- Any court-mandated payments, such as child support, if applicable
- Compensation for stolen or damaged property or money if it was directly your responsibility or a result of your actions
There should be no other deductions from your paycheck. An employer who fails to pay you the final wages you are owed will likely face penalties.
Penalties for Failing to Pay a Full Final Paycheck
If your employer fails to pay you your paycheck within the allotted time or takes illegal or unfair deductions from your paycheck, you are entitled to compensation. Under California labor laws, you are entitled to “waiting time penalties” or a full day of wages for each day late your full paycheck is. This payment is for a maximum of thirty days.
Failing to pay an employee their earned and much-needed final paycheck can end up costing an employer significantly more than the initial paycheck. In addition to these penalty payments, an employee is also entitled to the full payment that should’ve been included in their check.
California Labor Laws 2024
New labor laws in the state as of this year include:
- Increased minimum wage. Regardless of whether a company is a small or large employer, the state-wide minimum wage is $15.50 an hour. If the local minimum wage of a city or county is higher, that is the minimum wage companies must adhere to.
- Pay transparency. If a job applicant or employee requests a pay scale for a position, employers must provide it. Employers with 15 or more employees must include a pay scale for job postings.
- Protected leave for bereavement leave. If an employer has five or more employees, they must allow an employee bereavement leave for the death of a family member for up to five unpaid days.
- Protections for emergency conditions. There are increased legal protections for retaliation by an employer against an employee who has a reasonable belief that the workplace is unsafe because of an emergency condition.
- COVID-19 extended exposure notice requirements.
- Expanded California Family Rights Act Leave to include designated persons.
- The Contraceptive Act of 2022, which prevents discrimination against or forced disclosure of information regarding reproductive health.
Common Final Paycheck Issues
Especially if you are journeying through a final paycheck issue for the first time, it may be challenging to identify if there is even a problem at all. It is important to know what you can legally expect from your employer and what would be considered an issue. The following is a list of common final paycheck issues that employees face:
- Late or Missing Paychecks: A late or missing final paycheck may be due to employer delay or the employer’s misunderstanding of final paycheck laws.
- Incorrect Final Paycheck Amounts: An incorrect amount may look like an underpayment or even an overpayment, and both of these issues should be corrected.
- Employer Retaliation: Some employers may retaliate against employees who request their final paycheck or report issues related to it. Retaliation can look like demotion, negative performance reviews, or other adverse actions.
How to Respond If You Don’t Receive a Final Paycheck or It Is an Incorrect Amount
If you are facing the reality of having not yet received a final paycheck after leaving a position, or you have received your final paycheck but it is for an incorrect number of reasons that are not justifiable, there are certain steps you should take to protect your rightful earrings. Consider the following steps:
- Review Your Employment Agreement: First, review your employment agreement, company policies, or any relevant documents to understand the specific terms regarding final pay.
- Speak With an Employment Lawyer: It is advisable to speak with a trusted employment lawyer as soon as you are aware of the issue. The employment lawyer will inform you of your rights and potential next steps. They will provide specific legal advice specific to your situation and represent you in pursuing any legal action if this is necessary.
- Contact Your Employer: Reach out to your employer or HR department as soon as possible. Politely inform them of the issue and request a resolution. Keep a record of all communications, including emails, letters, texts, and notes from phone conversations.
- Send a Formal Request: If the issue is not resolved through initial communications, send a formal written request. Clearly state the problem, the amount you are owed, and the deadline by which you expect to receive the correct payment. It is advisable to send this request via certified mail with a return receipt to ensure it is received and acknowledged.
- Understand the Legality: In California, employers are required to provide a final paycheck immediately upon termination if you are fired and promptly if you resign with or without notice. Employers may be subject to waiting time penalties if they fail to provide this paycheck on time.
- File a Wage Claim: If your employer does not resolve this issue, or their attempts at resolution are not fair, file a wage claim with the California Division of Labor Standards Enforcement (DLSE). Your employment lawyer can help you with this. You will need to present all relevant documentation, such as pay stubs, employment contracts, and all correspondence with your employer.
- Seek Support: Reach out to workers’ rights organizations or advocacy groups for additional support and resources. You do not have to journey through this challenge on your own, there is available help.
FAQs About California Final Paycheck Laws
Employees who are leaving their job willingly and have provided 72 hours’ notice must receive their paycheck on their last day. If an employee leaving their job doesn’t provide notice, they must receive their last paycheck within 72 hours of their last day. If an employee is terminated or leaves their job against their will, they must be given their paycheck on the day of termination. If an employer fails to provide a paycheck in a timely manner, they may face penalties.
If you leave your employment with no prior notice, you are owed your paycheck within 72 hours of your final day of work. If you provide at least 72 hours’ notice prior to your final day of work, you are owed your paycheck on that day. If you don’t receive your paycheck about three days after you provide notice, you are likely owed late penalties from your employer for their failure.
You can receive your paycheck at work, via direct deposit, or in the mail. If you quit your job without 72 hours’ notice, you can request that your employer send the final paycheck to a designated address. The date the mail was sent is considered the date you receive payment under the law. If you don’t provide a designated address after quitting without notice, you can pick up your final paycheck from your employer’s office in the county you worked in.
If your employer doesn’t provide your paycheck on your last day of work or within 72 hours, you are entitled to “waiting time penalties.” These penalties equal a full day of wages for every day you have to wait for your full paycheck. These add up quickly but have a limit of 30 days.
Protect Your Employee Rights
You deserve wages for the work you do. If your employer is withholding your paycheck or deducting unfairly, discuss your potential for a claim with Ferraro Vega San Diego Employment Lawyers today.
