Illegal Paycheck Deductions: What Your Employer Can’t Deduct from Your Paycheck

Payday should feel fantastic. You’ve worked hard and have now been paid. But what if the paycheck amount appears smaller than expected? What if your employer took money for suspicious reasons?

California has some of the strongest worker protection laws. Your paycheck is safeguarded, and paycheck deductions are strictly regulated. Consider this a basic guide to your rights and what can be deducted.

The Rule of California Paychecks

First, remember this simple principle: Your employer cannot make you pay for things that are considered a normal cost of doing business.

If an expense is primarily for the employer’s benefit, it’s their responsibility to cover it. Additionally, deducting those costs from your wages could push your pay below the minimum wage, which is also illegal.

Common Things Your Employer CANNOT Deduct

Here’s a list of common deductions that are almost always illegal in California:

• Uniforms and Required Clothing

If your boss has you wear a certain uniform, such as a shirt with a corporate emblem or a unique design and color, they have to pay for it and keep it up. They can’t make you pay for it, either in whole or by taking money out of your paycheck. This also applies to clothes you need for work that you wouldn’t normally wear, like pants in a certain color or a particular kind of dress or shoes. But if the outfit is something that someone would normally wear, they don’t have to pay you back.

Simple Test: Could you wear this item for another job? If not, it’s probably a uniform, and your employer pays. However, there could be things that you can wear for another job that still must be paid for by your employer.

• Tools and Equipment

Your employer is responsible for giving you the tools you need to execute your job. This includes everything from a specialized knife for a kitchen task to a power drill for work in a warehouse. Your employer must provide you with what you need for your job if they say you need it. If the tools are usually needed in the trade and you make at least double the minimum salary, this does not apply.

• Cash Register Shortages or Breakages

A customer runs off without paying, a wine glass breaks, or the cash register is $20 short at the end of the night. Is it possible for your boss to take that loss out of your pay? No. These kinds of business losses are just part of running a business. Your boss can’t take these amounts from your compensation. If the loss is caused by an employee’s dishonest or willful behavior, or by their gross negligence, then this rule does not apply. This is not the case in most circumstances, especially when it happens by mistake or accident.

• “Walk-Outs” (Dine and Dash)

This is a specific and common example of a business loss. If a customer leaves a restaurant without paying, the employer cannot deduct that bill from a server’s wages. It’s illegal.

• Training Costs

If your employment requires you to get training, your boss has to pay you for the time you spend in training and for the training itself. For all hours of instruction, you should get your regular pay. This doesn’t include the cost of training that is required by law to work in the field or that the employee does on their own time.

• Pre-Employment Expenses

Things like background checks or drug tests that are required for you to get the job are the employer’s cost. They cannot deduct these fees from your first paycheck.

Wait, Are Any Deductions Allowed?

Yes, but the list is a lot shorter. Your boss can lawfully take money out of your paycheck for:
• Taxes: Required by law (federal, state, Social Security, and Medicare).
• Court-Ordered Garnishments: These are payments that a court has ordered, including child support or student loans.
• Health Insurance Premiums: If you signed a paper saying you would pay your half of the premium, it will be taken out of your paycheck.
• Wage Overpayments: If your boss unintentionally paid you too much, they may usually take the extra money back, but there are stringent limitations about how they can do this.
• Specific, voluntary authorizations: For instance, you give written permission for contributions to a benefit plan like a 401(k) plan or to acquire company shares.
• Other: Deductions that are allowed in writing and are not a refund to the employer of your pay

What to Do If You See a Deduction That Isn’t Legal

1. Keep track of everything. Save your pay stubs! They are proof for you.
2. Talk to your boss. Sometimes it’s just an honest error. You can calmly point out the deduction and remark, “I think this might be an illegal deduction.” Often, just talking about it can help you get things corrected swiftly.
3. Make a claim for unpaid wages. You have strong options if talking doesn’t work. You can start by making a claim with the California Labor Commissioner’s Office. This is an official process in which the state will look into the matter and may tell your employer to pay you back.
4. Talk to Bisnar Chase. We are employment lawyers, and we offer free consultations. We can help you understand your rights, provide guidance for your situation, and fight for your rights if you have a legal case.

Your paycheck is yours. California law is on your side to ensure you are paid for all the work you do. Don’t be afraid to speak up if something doesn’t look right, even your rate of pay. Knowing these simple rules helps protect you and every other worker.