First of all, it is illegal for an employer to withhold pay for hours worked, including overtime. The employer is bound by laws at both state and federal level, so it does not matter where you are employed in the United States. However, due to a number of possible factors, employers may find that they are unable to meet the obligation of paying employees. Although that would suggest that the employer is experiencing financial hardship, it does not help your situation either. If you fail to honor your own creditors, it could impact on your ability to get credit in the future. Not to mention the fact that you won’t be able to put food on the table or gas in the car.
As it is illegal for an employer to withhold your pay, you do have options for making a complaint. However, it is worth bearing in mind that pursuing legal action will likely create an undesirable working environment. Also, if the employer is making a habit of delaying payment, it is a sure sign that the business is struggling and may not be in a financial position to honor wages. There is a lot you should consider before deciding on a course of action.
When should my employer pay me?
As there are different dominant industries from state to state, how you are paid will normally reflect the best system for the state where you are employed. As such, your employer is obligated to pay you according to the state’s timetable. The United States Department of Labor provides a “Payday Timetable,” which is broken down by state. Whenever your employment commenced, you should have been provided with details of your payment schedule as part of your contract of employment.
It is important to understand when your employer is legally obligated to pay you, as you will only have a case once your employer is in breach of the conditions of your contract of employment, as dictated by state and federal laws. Under the federal Fair Labor Standards Act, employers are obligated to pay the minimum wage, pay overtime, and pay you on time.
Should I make a complaint?
You have a right to make a complaint; however, that does not mean it is the best option. If you have been with your employer for a considerable time or otherwise have a good relationship, you can negotiate terms for payment. If the employer is investigated and found to be in breach of the law, they could incur penalties on top of issuing back pay for any outstanding amount. In some states the employer may also have to pay you compensation for suffering financial hardship.
Regardless of whether you make a complaint or not, there is a risk that you will not receive the payments owed to you. If the business is in financial crisis, everyone will suffer. That is why it is important to take the correct course of action if your employer delays a single payment. If the situations merits pursuing the matter legally, you may want to also consider seeking employment elsewhere.
Making a complaint
If you do decide to make a complaint, it does not necessarily spell the end of your relationship with your employer. For instance, a Labor Standards Division can investigate your case and mediate between you and the employer. It is neither in your or the employer’s interest to pursue a course of action to either party’s detriment. Attempts to resolve the dispute should always be the first avenue that you explore.
If a resolution is still not possible, the commissioner of the Department of Labor can pursue criminal proceedings against the employer. This can result in the employer paying not only unpaid wages but penalties and interest on your payments, depending on the state. If the employer is in a financial position to pay you, he will not want to get involved in litigation which costs him more than the payments due.
My pay is being disputed
When pay is in dispute, the employer may suggest that they are unable to pay you until the issue is satisfied. However, disputed overtime or days worked does not give the employer the right to withhold payment for undisputed hours worked. If you have submitted hours according to your employer’s requirements, the employer should seek to rectify any disputes before the end of the payroll period. For your part, it helps if you have any overtime documented as agreed before working the hours. That way, should the employer dispute the hours, you can refer him to a record of the agreement and any documentation that confirms you worked the agreed hours.
Pay owed after termination of employment
You are entitled to receive full payment for the hours you worked during your tenure with an employer. That means, should you decide to prematurely terminate your employment, the employer cannot withhold your pay in an attempt to punish you. Additionally, an employer cannot use the fact that you are no longer an employee as an excuse to put of paying you. The employer must honor your final paycheck according to your normal payment schedule – if not before. Outstanding vacation pay is also owed, for any hours accrued, in some states. It is important that you understand your state laws on payment of accrued vacation hours. For instance, even if state laws do not obligate the employer to pay you accrued hours, there may be a contractual obligation to do so.
Hiring a labor lawyer
As you may have guessed by now, the way you approach a late payment from your employer will wholly depend on the circumstances. Navigating the legal aspects of a payment dispute will prove difficult on your own. A labor lawyer can help you resolve disputes as quickly as painlessly as possible.