Dependent care and final paycheck

jwatson

We have an employee that quit. She was paying for dependant care in addition to her own health insurance. Unfortunately, through a clerical error half of the money that was supposed to be deducted from her paycheck each month for the last 3 months was not deducted. This error was found just before she announced she was quitting. When she came in to get her final paycheck she was told that all of the money she owed was deducted from her final paycheck. She admitted that she knew the money was not being deducted the whole time. In deducting the money it put her below what would be considered minimun wage for Colorado. Less than 4 hours after she got her final paycheck someone claiming to be from the Colorado Department of Labor called us and said that we are in violation of Colorado State law.

I believe that the person calling was not an employee of the state but rather a friend or relative of this employee. But that is beside the point. Are we really in violation of Colorado state law by doing this?

Rockie

Generally, this is true in most states. If the deduction puts them below the minimum wage, you cannot deduct. In this case, you may want to get legal advice as she had previously agreed to these deductions (insurance and received the benefit of having the insurance).

I worked for a hospital in South Carolina and they gave signon bonuses of $4-$6,000 with a work guarantee of from one to two years. Employees were required to sign a waiver stating if they did not work the required amount of time, they would be subject to paying this money back through their final paychecks. You would not believe the people who would take the money, work for a few months, get a better job offer or higher signon bonus and then not want to pay back the money they owed us! One employee even stated it was not her signature on the payback sheet and therefore, she shouldn't have to pay it back, even though she took the money! We found out that we could not take entire paychecks of employees even though they signed a written agreement stating this. We had to make sure the deductions did not take them below the minimum wage. Needless to say,the hospital ended up "eating" a lot of bonus money and therefore, they discontinued this practice.

I believe this is the practice in most states concerning deductions of pay.