Can an Employer Withhold a Paycheck for Any Reason?

can employer withhold paycheck

Generally, an employer cannot legally withhold a paycheck from a current or former employee. Nevertheless, many employers threaten to dock employees' pay or withhold their paychecks if they do not meet certain expectations.

Many people cannot afford to miss even one paycheck, so they do whatever it takes to guarantee payment, even if their employer is violating the law. Luckily, California law can protect you from retaliation from your employer if you file an unpaid wage case against them. 

If your employer withholds your paycheck or threatens to withhold your paycheck for any reason, reach out to a California employment lawyer right away. Do not wait until evidence of your employer’s misconduct dissipates and becomes harder to prove. 

When Can an Employer Withhold a Paycheck

In most cases, an employer cannot withhold their employees’ paychecks without violating the law. Wage theft occurs when an employer intentionally fails to pay an employee or independent contractor. Wage theft applies to the following:

  • Hourly wages,
  • Salary wages,
  • Bonuses,
  • Overtime pay,
  • Benefits,
  • Tips, or
  • Commissions.

A victim of wage theft can file a lawsuit against their employer and report the offense to local police. If your employer is charged criminally, the judge will likely order them to give you the unpaid wages as restitution for their crime. Withholding wages is prosecuted as grand theft if they withhold more than:

  • $950 within one year, or
  • $2,350 from you and at least one other person within one year.

California law prohibits an employer from retaliating against an employee who reports wage theft. Forms of retaliation include:

  • Termination of employment,
  • Demotion,
  • Denying a promotion,
  • Reducing the employee’s pay or hours,
  • Moving you away from other coworkers, or
  • Treating the employee in a hostile manner.

If you suffer retaliation after reporting wage theft, you can submit a complaint with the California Labor Commissioner or file a lawsuit against your employer. A qualified attorney can explain the advantages and disadvantages of each option.

Can a Company Withhold Your Paycheck If You Quit?

No, a company cannot withhold your paycheck if you quit. California law requires employers to issue the final paycheck immediately for employees who get terminated or resign with at least 72 hours' notice.

If you do not provide notice before your resignation, the employer must issue the final paycheck within 72 hours. If you quit without notifying your employer at all, they have 72 hours to issue the final paycheck once they discover that you no longer work there.

The final paycheck must include the employee’s earned wages, accrued PTO, the cash value of other accrued benefits, bonuses, and expense reimbursements.

If an employer intentionally withholds your final paycheck, you can file a lawsuit to recover:

  • The unpaid wages plus interest,
  • A waiting time penalty,
  • Reasonable attorneys’ fees, and
  • Court costs.

The waiting time penalty is equal to the employee’s daily pay rate for each day you do not receive the final paycheck, up to 30 days.

The employer is not required to pay the waiting time penalty if there is a good faith dispute about the amount of wages they owe the employee.

Can I Sue My Employer for Not Paying Me Correctly?

Yes, you can sue your employer for intentionally withholding wages, withholding an entire paycheck, or failing to send your final paycheck promptly.

One way to recover the compensation you are owed is by filing a wage and hour lawsuit. You can ultimately recover the unpaid wages plus interest and reasonable attorneys’ fees. You can also file a wage and hour lawsuit for the following:

  • Misclassifying nonexempt employees as exempt employees,
  • Misclassifying employees as independent contractors,
  • Failing to abide by California overtime laws by encouraging employees to work off the clock,
  • Failing to provide hazard pay when such pay is provided under the employment contract,
  • Paying employees below the California minimum wage,
  • Failing to provide employees with mandatory meal or rest breaks, or
  • Making employees work through their mandatory meal or rest breaks.

The statute of limitations in California wage and hour disputes is three years from the date of the most recent violation. 

Another option to recover unpaid wages is by going through the California Labor Commissioner. The California Department of Industrial Relations offers an online portal for residents to file a wage theft claim.

The Labor Commissioner’s Office investigates the wage theft claim to determine whether the employer owes any wages and schedules a conference between the employee and employer to attempt to resolve the dispute. If the dispute is not resolved, the Commissioner’s Office may schedule a hearing where a hearing officer will investigate the wage theft claim and issue a decision.

If the Commissioner’s Office rules on your behalf and your employer refuses to comply with the decision, the Labor Commissioner will take them to court on your behalf. 

How Can an Employment Lawyer Help Prove My Wage Theft Case?

An employment lawyer can prepare your wage theft claim whether you decide to file a lawsuit or file a complaint with the Labor Commissioner. We will investigate your wage claim by:

  • Reviewing your pay stubs and weekly schedules,
  • Requesting payroll information from your employer,
  • Collecting surveillance footage to verify rest and meal breaks, and
  • Interviewing people in charge of payroll.

An experienced employment attorney can offer a critical advantage to your wage theft case.

Contact an Employment Law Attorney at Starpoint Law to Review Your Case Today

Unlike other law firms, Starpoint Law is highly selective with the cases we choose to take on, only accepting those we know we can win. Our attorneys take the time to meet with our clients and listen to the facts of their case. Then, we prepare a case strategy to prove your unpaid wage claim. 

We pride ourselves on keeping our clients informed of developments in their case every step of the way. Our team knows that clients do not want to be left in the dark as their case progresses.

Starpoint’s employment law expert, Aidin Ghavimi, possesses years of experience supporting clients dealing with wage and hour disputes in California. Contact a member of our team today so we can start reviewing your case.

Author Photo

Aidin Ghavimi

Aidin is a partner at Starpoint LC, Attorneys at Law, and focuses on personal injury and employment law cases in and around Southern California. He earned his Juris Doctorate from the Loyola School of Law and his Bachelor’s from USC. Aidin’s primary goal is to bring justice to his clients and to ensure they are able to move on with their lives after a serious injury.

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