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What is Pay Docking and Is It Legal?

Employment RightsThe Fair Labor Standards Act governs wage and hour laws for nonexempt employees. This law requires all employers to pay nonexempt employees the federal minimum wage or higher and requires overtime pay for employees who work more than 40 hours a week. When an employee performs poorly or violates company policy, some employers may choose to penalize the employee by deducting part of their pay, also known as docking their pay. Unless there is a union contract or agreement that prohibits otherwise, employers are allowed to dock their employees pay as long as the employee is still paid at least the minimum wage. When it comes to salaried employees, however, pay docking is only allowed under certain very specific circumstances.

Impermissible Pay Docking

The law prohibits employers from docking the pay of an exempt employee because of the quality of their work. An exempt employee must receive their full salary each week. Examples of exempt employees include executives, administrators, professionals, and some computer employees. Exempt employees are required by law to receive at least $455 per week in salary or the equivalent in an hourly rate ($27.63).

Permissible Pay Docking

Workers who are not salaried may find their paychecks docked for workplace violations, mistakes, or poor performance. This penalty is legal provided the employee is paid minimum wage and is not exempt. Mistakes in the workplace could include cash register shortages, damaged property, lost property, or the acceptance of bad checks.

The FLSA permits employers to dock the pay of exempt employees’ salaries in very specific situations, including:

  • When the employee is absent for one or more days for personal reasons
  • When the employee is absent due to sickness or disability, but only if the employer has a plan to compensate the lost salary in place
  • To offset compensation received due to jury service or military service
  • To impose penalty for violation of safety rules
  • For unpaid disciplinary suspensions of one or more days
  • For unpaid leave under the Family and Medical Leave Act
  • During the first or last week of employment, if the worker does not work a full week

Penalties for Impermissible Pay Docking

When unscrupulous or negligent employers engage in the practice of improper pay docking, they can be held responsible and penalized for their actions. If the employer did not pay a salaried employee properly or they improperly docked their pay, they risk losing the overtime exemption for the period the docking occured. Employees who have had their pay improperly docked are eligible to receive reimbursement.

Contact Our Miami Employment Lawyers Today

If you believe you have been a victim of illegal pay docking or wage theft, it is important to know that the law is on your side. When your pay has been docked, you may have cause to file a claim. As such, it is important to speak to an experienced Miami employment lawyer immediately to learn more about your legal rights. Call the Law Office of Keith M. Stern, P.A. today at 888-315-8771 and we can help protect your employment rights and your pay.

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