Can My Employer Deduct or Take the Cost of Lost or Damaged Equipment Out of My Paycheck?

One Would Need a Large Paycheck!

Generally, if you are an hourly employee, payroll deductions may be made if you lose or damage company equipment. Click Here for a U.S. Department of Labor Opinion Letter on this issue (see second half of Opinion). The opinion also discusses whether employees can be charged for loss or damage to "tools of the trade" issued by their employers.

However, such deductions may not be made for salaried employees.  Click Here to read DOL's views on this issue (first half of Opinion).

Caveat:  If you are paid a salary, and such deductions are made from your pay, then you may be deemed a "non-exempt" employee thereafter entitled to overtime.

Caveat:  If you are an hourly worker, the deduction cannot result in you being paid less than the minimum wage for the week in question; further, such deductions cannot be used to reduce the amount of any overtime compensation you have earned.

Although it does not appear that a written policy setting forth the deduction practices of the company is required, it is probably a good idea.

Caveat:  If you are going to deduct pay from an hourly employee, you best be correct that they are responsible for the loss/damage.  Under Pennsylvania's Wage Payment and Collection Law, serious liabilities may arise if an employer unlawfully withholds pay from an employee.  These include a 25% penalty, individual liability for any management personnel that participated in the wrongful decision to withhold wages due and a mandatory award of attorney fees and costs paid to any prevailing employee.

Final Caveat:  The rules discussed herein arise from the Fair Labor Standards Act.  Hence, if an employee who complains about perceived unlawful deductions is terminated because of such complaint, significant liabilities may arise.

HERE ARE SOME OTHER ARTICLES YOU MAY FIND WORTHWHILE:

Pennsylvania Overtime Lawyers Explain the Basic Rules - Exempt or Non-Exempt

Misclassification of Employees as Independent Contractors - What's That Mean? Pennsylvania Contingent Fee Lawyers Explain

Can 1099 Workers Get Overtime? What Can I Do if I Have Been Misidentified as an Independent Contractor (Paid on a 1099) When I Should be Deemed to be an Employee (w-2 Worker?)  Pennsylvania Employment Lawyers Explain

Am I Really a Self-Employed Independent Contractor?  How Do I Know if I am Self-Employed or Properly Identified as a 1099 Employee??

Comparing Pennsylvania's State Overtime Law, the Minimum Wage Act, with its Federal Counterpart, the Fair Labor Standards Act - Pennsylvania Wage and Hour Lawyers

Do I Have to Be Employed to Get the Bonus or Commission I Earned in Pennsylvania?

Are You Owed Money by Your Former Employer?  Pennsylvania's Wage Payment and Collection Law is a Powerful Statute

Two Important Differences in Pennsylvania Law for Overtime Claims - Sales Persons and IT Professionals

 Overtime Rules, Regulations and Laws in Pennsylvania

If You are a Computer Professional, You Are Entitled to Overtime in Pennsylvania

Overtime for Sales Persons in Pennsylvania - Exempt or Non-Exempt? Outside Sales Persons Entitled to Overtime in Pennsylvania

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