Legal Limits On Pay Docking And Unpaid Suspensions

Are You Getting Properly Compensated For Your Work?

Some employers dock workers’ salaries or put them on unpaid suspensions to discipline them for violating workplace rules. According to an employment attorney in Los Angeles, this policy poses problems when the employee (whose pay is reduced) is exempt from overtime. A common example is an employee paid on salary, exempt, and still subjected to unlawful salary deductions.

How Does Pay Docking Become a Problem?

To qualify as exempt, an employee has to be paid an agreed amount of money each period per the contractual terms without deductions based on the quantity or quality of their work. Docking an employee’s pay is treating them like non-exempt workers, and the law might put them in that classification. Non-exempt employees are entitled to overtime pay. You should not expect to receive unpaid wages. If so, your rights are being violated.

So What Qualifies an Employee to Be Salaried?

Under federal law, employees who aren’t entitled to overtime pay must earn a minimum of 684 U.S dollars every week or 35,568 U.S dollars annually. Contact an attorney to determine what qualifies as the minimum pay in California State if you are unsure. To qualify as an exempt employee, one must be paid on a salary basis. However, this requirement does not apply to teachers, outside sales employees, doctors, some computer employees, and lawyers.

Paying an employee on a salary basis means that they are paid a fixed amount per stipulated pay period regardless of the number of hours they have worked, the quality of their work, or how much they accomplished. Employees may need a lawyer to sue an employer for unpaid wages if subjected to improper deductions.

What Are Lawfully-Permitted Salary Deductions?

Employers are allowed by the law to make salary deductions without jeopardizing the employee’s exempt status for one or more days if an employee takes an off. Below is a list of permitted salary deduction scenarios:

1. They go on unpaid family and medical leave (FMLA)
2. Take off days to take care of some personal issues.
3. Taking a leave for illness or disability reasons and having a policy such as sick leave or disability insurance will compensate them for the time off.
4. They take time off to serve as a court witness, a jury member, or short-term military leave. However, the employer must only deduct the employee’s amount as military pay, jury, or witness.
5. One can deduct employees’ pay if they don’t work a full week during the first or last work week.
6. Deductions can be made as a good faith penalty imposed to improve safety and prevent any workplace dangers.
7. Deductions are permitted if employers have well-written policies to allow for unpaid disciplinary suspensions imposed on them in good faith due to violations of workplace rules and conduct. However, these policies should apply to all employees.

What Constitutes Improper Deductions?

An employer can be penalized for practicing improper pay deductions. This is defined as an action or set of activities that clearly show the employer’s intentions of deducting salaried employees’ pay. Below are the factors a government agency and the court will consider when making this decision

1. How many improper deductions has the employer made?
2. How many employees experience inappropriate salary deductions, and did they work during that period?
3. The period during which the employer made the improper deductions
4. Has the employer communicated any policies that prohibit or permit improper deductions?

What Is the Penalty for Improper Pay Deductions?

When it’s determined that the employer continually makes improper deductions, they will lose the overtime exemption status for the employees subject to the deductions. They must, therefore, pay overtime to every employee subjected to improper deductions if they worked during this period.

Conducting improper employee pay deductions can land employers in trouble. Employees should contact overtime dispute lawyers in Los Angeles for help if they suspect their employers subject them to improper pay deductions.

Employer Safe Harbor Safeguards

Employers will not be penalized for salary deductions if either of the two is correct:

1. If the improper deduction cases were inadvertent or isolated, employers reimbursed the employees for improperly withheld pay.
2. If there are clear policies that are well communicated prohibiting improper pay deductions, plus a well-stated complaint procedure, reimbursement of money that was wrongly withheld, and making an effort in good faith to obey the law in the future

What to Do If You Are Subjected to Improper Pay Docks

As an employee, if you suspect that you’re subjected to improper pay deductions, you may need a lawyer to sue an employer for unpaid wages and file a complaint on your behalf. Don’t delay filing a claim with your state agency. There are strict deadlines in which outstanding wage charges should be filed. Don’t wait to file a complaint when the deadline is closed.

Although many states like California will follow the federal laws on unpaid suspensions, employers should reach out to a workplace lawyer to determine compliance. Employees should pursue legal help with any overtime disputes and salary deductions. National and California state wages and hour laws determine whether employee suspension must be paid in L.A.; thus, employers have to legally discuss their case with legal professionals to help them classify employees as non-exempt or exempt.