An employer may appropriately withhold sums from a worker’s income only: (1) whenever required or empowered to do so by state or federal law, or (2) if a deduction is expressly sanctioned in writing by the person to handle insurance premiums, benefit plan contributions or other deductions not determined a rebate on the individual’s pay, or (3) when a deduction to pay for overall health, welfare, or pension contributions is expressly sanctioned by a wage or collective bargaining contract.
Although a wage garnishment is an authorized deduction from income under California labor laws, a company can’t discharge a worker for the reason that a garnishment of pay has been threatened or if the person’s pay has been subjected to a garnishment for the satisfaction of one judgment.
The ability of a company to deduct amounts from an employee’s pay because of a cash shortage, breakage, or loss of equipment is expressly governed by the Industrial Welfare Commission Orders and limited by court decisions. Furthermore, there have been several court holdings that significantly restrict an employer’s ability to take an offset against an employee’s income.
Some typical wage deductions typically made by employers that are unlawful include:
Gratuities. An employer cannot collect, take, or receive any gratuity or part thereof given or left for an employee, or deduct any amount from wages due an employee on account of a gratuity given or left for an employee. However, a restaurant may have a policy allowing for tip pooling/sharing among employees who provide direct table service to customers.
Photographs. If an employer requires a photograph of an applicant or employee, the employer must pay the cost of the photograph.
Bond. If an employer requires a bond of an applicant or employee, the employer must pay the cost of the bond.
Uniforms. If an employer requires that an employee wear a uniform, the employer must pay the cost of the uniform.
Business Expenses. An employee is entitled to be reimbursed by his or her employer for all expenses or losses incurred in the direct consequence of the discharge of the employee’s work duties.