Wage Deductions

The Fair Labor Standards Act ("FLSA") requires employers to pay most employees at least the minimum wage for all hours worked in a workweek, as well as time-and-a-half an employee's regular rate for all overtime hours worked (all hours over 40 in a work week). The current federal minimum wage (applicable in Missouri) is $7.30 per hour. In Illinois, minimum wage is currently $8.25 per hour for most employees.

Sometimes an employee's pay appears to be at or above minimum wage (or at or above time-and-a-half for hours in a week in excess of 40 hours), but after the employer makes one or more deductions from an employee's paycheck, the employee actually ends up making less than is legally required (i.e., less than the minimum wage or the employee's overtime rate). Such deductions are often illegal, which is an issue all too familiar to wage and hour lawyers.

The following are the types of deductions that normally get employers in trouble, provided the deductions bring an employee's level of pay below what is required under minimum wage or overtime laws: the cost of an employee's uniform, the cost of tools used by an employee as part of his or her work, damage to the property of the employer or a third party caused by the employee, financial losses due to clients/customers not paying bills, and theft of an employer's property by an employee or other individuals.

The US Department of Labor has compiled a useful factsheet to explain when deductions are unlawful. As illustrated in the DOL's factsheet, here are some examples of unlawful payroll deductions (assuming they would result in a reduction of an employee's pay below minimum wage or overtime pay):

1. A cashier's cash drawer is short, so money is taken out of the cashier's paycheck to make up the shortage.

2. An employee has a car accident while driving an employee's vehicle, and is forced to pay for the damage (to the employer's vehicle or to a third party's vehicle) out of his or her paycheck.

3. A customer at a restaurant walks out without paying their bill, and the waittress or bartender is forced to pay for the unpaid bill out of their paycheck.

4. An employer requires an employee to wear a uniform while on duty and takes money out of the employee's paycheck to pay for the uniform or the cost of cleaning the uniform.

5. A security guard is forced to pay for the cost of a handgun or taser gun that he or she is required to use for their job.

6. An employee is required to pay for the cost of one or more medical examinations that are mandated by the employer.

If you believe that you are the victim of illegal wage deductions, or if you wanted to better understand your rights, you should consult a St. Louis wage and hour attorney.