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04 . 21 | Employment Law

Which Paycheck Deductions Are Legally Permitted in California?

Let’s be honest. Los Angeles is not necessarily all it’s cracked up to be. Beautiful beaches, Hollywood glamour and Beverly Hills extravagances are just one part of the picture – and a small part at that.

The bigger picture features lots of average Californians  — some who work behind the scenes in the film or television industries  — and others with more mundane jobs. Some are fairly well off and others are living paycheck to paycheck.

Regardless, there is always a discrepancy between gross and take-home pay.  This is simply due to paycheck deductions. Of course the question then becomes, which paycheck deductions are California employers allowed to make? In this article, LawPLA’s highly skilled employment lawyers address this important question.

Key laws and regulations governing California paycheck deductions

In California, there are two sets of laws and regulations governing paycheck deductions. The first is the state Labor Code. It contains provisions regarding:

  • Allowable deductions
  • Garnishments
  • Unlawful deductions
  • Exceptions
  • Your options if your employer makes illegal deductions
  • The wage claim procedure for illegal deductions
  • Retaliatory conduct against an employee who makes a wage claim alleging unlawful deductions

The Industrial Welfare Commission Orders address related topics, such as deductions based on cash shortage, breakage, or loss of equipment. These orders also define the term “uniform” as used in the context of California employment.

Allowable paycheck deductions under the state labor code

In accordance with the California Labor Code, there are three circumstances in which an employer can make deductions from employee paychecks. 

The first is when state or federal law requires or authorizes the employer to do so.  The best examples of allowable deductions under these provisions are state and federal income tax deductions.

The second circumstance is when you (the employee) specifically authorize a deduction or deductions in writing for certain purposes. For instance, employees sometimes give their employers written permission to make deductions to cover insurance premiums, benefit plan contributions or other deductions.

Lastly paycheck deductions are allowed if you belong to a union that authorizes them in a collective bargaining agreement. Deductions permitted by these agreements, or wage agreements generally cover health, welfare, or pension contributions.

With all of that said, there is just one more important point to keep in mind. Paycheck deductions in the form of wage garnishments are also allowed to satisfy court-ordered judgments. However, you cannot be fired because you have been threatened with wage garnishments. Your employer is also barred from firing you if your wages are subject to garnishment for the payment of a single judgment.

Examples of unlawful California paycheck deductions

Now let’s take a look at some examples of paycheck deductions your Los Angeles employer is not allowed to make. Your employer cannot take money out of your paycheck if:

  •  they are doing it to offset repair costs for damages to company property caused by your negligence.
  • you caused accidental cash shortage.
  •  Customer returns adversely affected your commission pay.
  •  they are making the deductions to punish or discipline you.
  •  they are doing it to make up for overpayment in a past pay period.
  •  they are doing to offsetyour tips or gratuities.
  •  they are doing it to cover a bond required in the application process.
  •  they are doing it to offset required the costs of any required photographs.
  •  they are doing it to offset uniform costs.
  •  they are doing it to offset or any business expenses you’ve incurred.
  •  they are doing it to cover the cost physicals or other medical exams required as a condition for employment.

What to do about wrongful paycheck deductions

Here are some options if you believe your LA employer is making or has made improper paycheck deductions. First, you can file a wage claim with the Division of Labor Standards Enforcement (the Labor Commissioner’s Office).  If you pursue this option, your claim will be given to an official for review. Based on his or her findings, a conference or hearing will be scheduled, or the matter will be dismissed.

Alternatively, you can sue your employer to recover the lost wages.If you pursue this option, you’ll need skilled civil litigators on your side. That’s where we come in. At LawPLA, our employment lawyers have the knowledge, passion and determination to fight for you. So don’t hesitate to contact us through our website or by phone to schedule a free consultation today.

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