Those who receive paychecks are aware that there are several deductions that are made from it: social security, income taxes, premium for health insurance, retirement savings and so forth which you might also authorize your employer to do.
There are legal garnishments that can be taken out from paychecks, such as when debts have to be repaid; child support payments need to be made as well as student loans, medical bills, taxes and consumer debt so need a auto calculator. There could be other kinds of legal or authorized withholdings as well.
State laws state the boundaries within which employers can or cannot make deductions from paychecks. You might want to check with your state labor department or an employment attorney to understand what your legal rights are.
Provide your consent
One of the points to remember is that, all kinds of deductions, even statutory ones, need the consent of employees. This is usually given in written format; if you have not provided so, then you need to speak with your employer. Usually the terms of appointment letter have a section on the different deductions that are applicable on your salary. Hence, when you sign on the appointment letter and return the same to your employer, you have agreed to the standard, statutory and any specific company based deduction that the employer might have included.
For instance, employers in restaurants might deduct from server employee paychecks if they serve a wrong dish, a customer sends back a served dish or they break a dish, but that is not legal unless the employee has signed on the terms from before.
It is necessary to be careful about what one signs at the time of accepting a job. One could even get the terms reviewed by an attorney.
Those who work by the hour might get docked by employers on account of tardiness. However the employer should be reasonable in this matter; especially when one is only a minute late then paying them for the full hour makes sense.
It is best that one sits down with their boss to discuss such matters, especially if one has been docked for an hour only for a few minutes.
What if you break something or lose money for your company?
The employer cannot withhold money from paycheck for such scenarios unless these terms have been included in the letter of appointment or are permissible as per labor laws in the state.
An employer can subject an employee to disciplinary conditions, but an agreement should be in place before the money is taken out of their paycheck.
This can vary as per the specific situation. For instance, an employee could be dishonest, negligent or act willfully. The employer will also have to prove these aspects since simply accusing someone does not make sense.
When money is borrowed?
If employer loans someone money this will be with a written agreement. If an agreement is not signed, then any amount being deducted from your paycheck is not the right step to take though they would have legal rights to take back the money.
What if the employer withholds money without consent?
The first step to take is to communicate with the employer to understand and gain information on the matter. In case, nothing is given in writing or explanation provided, one should seek help from an employment attorney, especially someone from the labor department of the state who can provide you information on your rights.
It is necessary to keep in mind that debt needs to be kept at manageable levels and ideally out of your paychecks. You should have more flexibility in spending along with saving as well as investing. You should check on your credit score from time to time in order to understand how your debt is impacting your financial health.
Ensure that you know the net amount that should come in your paycheck every month and check on the same to ensure that no extra deductions are made without explanation.