The time requirement for giving a final paycheck to an employee depends on whether the employee quit without notice, quit with at least 72 hours’ notice or was terminated or laid off. State enforcement agencies can penalize employers for not providing an employee with a final paycheck in a timely manner.
1. Review Hours
Were you paid all wages due? All reimbursements?
2. Review Rates
Does it contain all regular and overtime hours? All commissions?
Note: Did the employer determine commission wages owed at the time of termination, they must pay the commission owed as soon as the amount is ascertainable and in a manner consistent with their commission pay policy.
3. Were Deductions Proper?
After determining the amount due to the employee, make proper calculations for any deductions, including:
- Federal, state and local income taxes
- Social Security
- State unemployment insurance
Note: These deductions can’t include any amount representing the unpaid balance of a debt owed by the employee. In addition, these deductions cannot include the value of any of your property the employee might have, even if the employee doesn’t return the property to you. You can be fined if you do so.
4. Provide the Final Paycheck Within Required Timelines
- If the employee quits with 72 hours’ notice or more (clock hours, not business hours), you must have the final paycheck ready to give to the employee on his/her last day of work.
- If the employee quits with less than 72 hours’ notice (clock hours, not business hours), you must have the final paycheck ready for the employee within 72 hours of when the employee gave notice.
- If you are terminating the employee, you must hand the employee the final paycheck at the moment you inform the employee that he or she is terminated.
- If the employee requests to have the final pay delivered by direct deposit to one or more bank accounts, you need to get authorization