Q: I WORK at a service-oriented business here in California as an hourly employee. We are required to wear a uniform. We can only get the uniform from our employer and the employer deducts from our pay the cost of these uniforms. Is this deduction legal? How do I know that the deductions from my paycheck are allowed by law?
A: No, this deduction for employer-mandated uniform is prohibited under California law. Where uniforms are required by the employer to be worn by nonexempt employees as a condition of employment, the law mandates that the employer must provide and maintain these uniforms. The term uniform is defined to include wearing apparel and accessories of distinctive design and color.
A payroll deduction is essentially a subtraction of money from the employee’s paycheck so that the employee receives less than the promised compensation. In order to protect employees, the law regulates deductions. Employers must adhere to the following:
1) No deductions for uniforms or lost tools – A deduction for uniforms or loss of tools is allowed only if the employer can prove that the employee stole the tools or uniforms or if there was “culpable negligence.” However, if the employee gave advance authorization, the employer may be able to deduct from the employee’s paycheck the cost of tools and uniforms furnished by the employer in the event such items are not returned.
2)No deduction for business losses caused by employee negligence – Unless the employee was dishonest or willfully or grossly negligent, an employer may not deduct for ordinary losses caused by an employee. Losses due to an employee’s simple negligence, such as cash shortages and breakage or loss of equipment, “are inevitable in almost any business operation” and must be borne “as expenses of management.” The law prohibits the employer from using an employee’s wages to shift the losses of the business to the employee.
3)No deduction for workers’ compensation costs – An employer is prohibited from directly or indirectly taking any deduction from an employee’s earnings to cover any part of the costs of worker’s compensation.
4) No right of offset for employee’s debts to employer – An employer is prohibited from deducting payment of a debt that an employee owed to the employer. However, an employee may authorize an employer to withhold some amounts owed by the employee to pay a debt to an employer. The employee must acknowledge the debt in writing. This is allowed particularly when the employee had been making periodic payments on an agreed-upon basis. But if the employee is terminated before the entire debt is paid, the employer may not “accelerate” the balance. Rather, the employer may withhold from the employee’s final paycheck only the periodic amount then due.
5)No chargebacks for commissions fully earned – A commission chargeback may be unlawful where the commission was fully earned at the time of a sale (that is, payment was not an advance on commissions) and the employee has not agreed in writing to the chargeback. However, an employee who receives both wages and sales commissions may agree in writing to a chargeback against commissions advanced by the employer if the sale did not proceed (for example, the customer returns the merchandise).
6)No taking back of wages earned and paid – It is unlawful for an employer to collect from an employee any part of the wages that had already been earned and paid to the employee. However, the employer may take back overpayment of wages that had not been earned.
If the employer is found to have unlawfully made these deductions, the employer is liable to the employee for the amount of the wages withheld, plus any waiting time penalties due. If an employee has doubts about the legality of a payroll deduction, it would not hurt to ask an experienced employment attorney for legal advice.
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C. Joe Sayas, Jr., Esq. is an experienced trial attorney who has successfully obtained significant results, including several million dollar recoveries for consumers against insurance companies and employers. He has been selected as a Super Lawyer by the Los Angeles Magazine, and is a member of the Million Dollar-Advocates Forum – a prestigious group of trial lawyers whose membership is limited to those who have demonstrated exceptional skill, experience and excellence in advocacy. He has been featured in the cover of Los Angeles Daily Journal’s Verdicts and Settlements for his professional accomplishments and recipient of numerous awards from community and media organizations. His litigation practice concentrates in the following areas: wage and hour (overtime) litigation, serious personal injuries, wrongful death, insurance claims, and unfair business practices. His law firm is currently class counsel to thousands of employees seeking payment of wages in California courts. You can visit his website at www.joesayaslaw.com or contact his office by telephone at (818) 291-0088. Inquiries to his law office are welcome and at no cost.