How Long Can An Employer Hold Your Paycheck After Termination?

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When your employer decides to let you go from the company, it may be an upsetting or exciting moment for you.
However, when you need to leave without notice, you may not have your final paycheck in hand, or you may have it but notice unfair deductions, which, depending on various factors, can be unlawful.

According to the California employment law, employees must receive their final paycheck immediately. In the case of termination, you must receive your paycheck on the same day. If you quit the job, you must receive your final paycheck within 72 hours of notice. If you give notice 72 hours before your last shift, you should get your paycheck on the same day. If you do not provide notice, the paycheck should be sent within 72 hours of your last day.

What Should be Included in the Final Paycheck?

Some employees may get their paycheck on time but find some deductions that should not have been there. For fair pay, ensure your paycheck includes:

  • All wages
  • Business expenses
  • Commissions owed
  • Benefits in cash value, including paid time off, sick days, and vacation

You have been properly compensated if your final paycheck covers all of these. You may consult an expert employment lawyer in California if you do not find all the coverage.

What May be Deducted from a Final Paycheck?

Your employer can only withhold or deduct specific amounts from your final paycheck, including:

  • Standard federal and state tax deductions
  • Applicable court-mandated payments
  • Damaged or stolen money or property compensation if your actions caused it

Your paycheck should have no other deductions. If your employer fails to pay you the owed wages, they can face penalties.

What Are the Penalties for Not Paying a Full Final Paycheck?

You are entitled to compensation if your employer does not pay your final paycheck within the allotted time or if it includes unfair deductions. You can seek compensation as a full day’s wage for up to 30 days for every day your paycheck is late.

An employer can end up paying much more than they had to pay in the paycheck. Apart from the penalty payments, you are also entitled to the full payment you were supposed to get in the paycheck.

New California Labor Laws of 2024:

  • Increased minimum wage: Irrespective of a company’s size, small or large, the minimum wage is $15.50 per hour. If the minimum wage of a county or city is higher, companies must follow the same.
  • Pay Transparency: An employer must provide if an employee or applicant requests a pay scale for a specific position. An employer with 15+ employees must have a pay scale for job postings.
  • Protections for Emergency Conditions: An employee can get increased legal protection if they believe the workplace is unsafe due to an emergency.
  • Protected Leave for Bereavement Leave: An employer with 5+ employees must let an employee bereavement leave in the case of a family member’s death for up to five unpaid days.
  • The Contraceptive Act of 2022: It stops discrimination against or forced disclosure of info about reproductive health.
  • COVID-19 Extended Exposure: Notice requirements.

Also Read: What is a COBRA Election Notice?- Continuation Of Health Coverage