California Final Paycheck Law


 

California Final Pay Law

If you are an employee and have not received your final paycheck, or your final pay was late, contact my law office. We will get you paid - and potentially a lot more. Employers will typically not pay owed penalties unless forced to.

* An employee was not paid $400. We got him a judgment for $7000 based on multiple penalties involving his final paycheck.

* An employer forgot to pay an employee a few hours. We scoured documents for potential violations on numerous issues and the employee received $20,000.

* An employee decided to handle a claim by himself with the California Labor Commissioner. The Commissioner threw his case out even before a hearing. But the employee had a great claim - he had no idea existed - because he wasn't an attorney and didn't know any better.

* An employee was sued for stealing customers and already had a court injunction against her when we were contacted. We found a final pay issue and were looking at more claims when the company decided to drop its lawsuit and give up the injunction.



When an Employee has been Terminated

When an employee has been terminated California's final pay law is clear: their final paycheck must be immediately given to them on their last day of work.

The employee must be paid at the place where they are being terminated. This may be difficult for an employer terminating an employee who is away from the office, or terminating someone by phone or email. In that situation the employer had better courier for hand-delivery a final paycheck to the employee at their residence for delivery that day. Otherwise, the employer is subject to paying penalties for every day until the employee receives their final pay.

Issues covered:
Final paycheck California
Last paycheck California
What the law requires




When an Employee Quits or Resigns

If the employee is the one ending the employment relationship, payment rules depend on whether 72 hours advance notice was given or not.

If at least 72 hours (3 days) notice has been given by an employee that they intend on leaving then their final paycheck in California must be given to them on their last day of employment.

If less than 72 hours notice is given then the employee can be paid at their place of work by having a final check available within 72 hours. Instead of coming into the office to collect their final check, the employee can request in writing to be paid by mail and where to mail the check. The date of mailing is what counts for determining if payment has been made within 72 hours (3 days).

If less than 72 hours notice is given, and the employee does not given instructions on where to mail their final check, then payment is made at their regular workplace. That means the employer has the check ready for the employee to pickup. If the employee fails to pick up their check, escheat rules may apply and after three years the employer may need to notify the State Controller's Office it has unclaimed money belonging to the employee.

*** Worth Repeating: Employees - If you quit and did not give 72 hours notice, and did not provide written (example email) instructions on where to mail your final check, your employer does not have to mail you your check.

Your check will be waiting at the office to be picked up.

If you are in this situation and waiting to be paid, your employer does not owe you any penalties unless you go to the office to get your final check and it is not given to you.


If an employee gives advance notice of an intent to quit and the employer ups the date by terminating them on the spot, then the last paycheck must be immediately paid. The 72 hour rule no longer applies because the employer is terminating the employee before the employee quits.


Where an Employee is Paid

If an employee is terminated they must be paid at the place of termination.

If an employee quits they can be paid at the office where they work. If an employee works from a home office then that is the place where they need to be paid.

For out of state employers the California final pay law requires payment in California.


What Wages and Amounts Must be Paid

In the employee's final and last paycheck all owed wages must be paid.

All owed vacation pay must also be paid in the last paycheck.

Reimbursement of expenses does not need to be paid until they would ordinarily be reimbursed.

For commissions, if commissions were earned and payable at the time of termination they must be paid at that time. If commission payments later become owed, such as a client paying after the employee leaves, then the commissions should be promptly paid at that time.


Penalties for Violating California's Final Pay Rules

The penalty for violating the California final paycheck law can be severe.

Failing to timely pay all final wages means the employer owes a penalty.

The penalty accrues every day, for up to 30 days, until proper payment is made.

The amount of the penalty is the employee's average daily wage.

An employee can sue and recover attorney fees if the penalty is not paid.


Other California Final Pay Questions and Answers

Question: Do you have to sign for your final paycheck in California? Answer: No. An employer is not allowed to impose any conditions on your ability to be paid. If you are receiving a check via certified mail then you sign for the mailing.

Question: Is California's final pay law the same for independent contractors? Answer: No. If you are a contractor and are not paid then there is no penalty. If you were really an employee and misclassified as a contractor then you could be owed a significant amount of money for late payment and other wage law violations.


Legal References

California Labor Code sections 201, 202, 203, 208, and 218.5.


Special California Rules

Final paycheck rules in California may vary for workers in certain industries, such as the motion picture industry or seasonal agriculture workers.



Related:

California Waiting Time Penalty Law

California Vacation Pay Laws


Contact Us for More Information

If you have a final paycheck question, are owed money, were not timely paid or otherwise need an attorney please contact my office immediately.

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Brian Kindsvater
Business, Law and Tax
PO Box 725
Rancho Cordova, California 95741
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