In 1915 The Texas Payday Law was created to address disputed wage claims between employees and employers. Every private employer in the state is subject to the law and failure to understand it is costly.
Because of this law we have forms to cover any payroll deductions that should be deducted from the employee's pay check. This form is required to be in place in our payroll department before the deductions can come out.
Be aware of what might trigger a Payday Wage Claim: The Texas Payday Law has strict guidelines for wage payments. An employee may have a valid payday claim against an employer who does any of the following:
- Withholds or deducts from a paycheck any amount of money without specific, written authorization from the employee.
- Refuses to pay employees any fringe benefits (vacation pay, severance pay, etc.) promised in writing.
- Makes payroll deductions to compensate for a mistake in the pay without the employee's written authorization.
- Makes salary cuts without first notifying employee.
- Withholds promised commissions or charges employees for unearned commission without employee's written authorization.
- Refuses to pay non-exempt employees time and one-half for overtime.
- Pays non-exempt employees a salary that equals less than minimum wage because of number of hours worked.
- Fails to pay a fired employee within six calendar days after dismissal.
- Fails to pay an employee who quits by the next regularly scheduled payday.
- Fails to pay exempt employees at least once a month, and non-exempt employees at least twice a month.
- Gives a paycheck to a person other than the employee without prior written authorization from the employee.
- Requires wage payment by electronic funds transfer (EFT) even if the employee objects.
The Message is Clear: ..Get it in writing.
Without an employee's written permission for payroll deductions, employers face potential payday law wage claims. These mistakes can cost a company time and back wages owed, and if it is determined an employer acted in bad faith in not paying wages, a penalty of up to $1,000.00 can be assessed.
