What Are the Laws Against Not Paying Employees?

Employee rights are a hot topic, and rightfully so. With the increasing number of people working on contract or part-time jobs instead of full-time, it’s important to know what your rights are as an employee. This post is intended to educate you about the laws against not paying employees – so that if you’re being paid unfairly, you can do something about it!

Knowing your obligation to pay employees is a top priority for any business owner, but when time and cash are both tight it can be tempting to come up with other ways to save. Maybe you delay paying an employee who becomes unavailable or decides not to pay an employee after their termination. But paying your workers is one of these leading legal obligations as an employer.

Here are common issues with paying personnel that can trigger complaints to federal and state employment agencies:

Late payments

Some employees may not get their paycheck on time, preventing them from meeting day-to-day living costs.

Unpaid overtime

Some companies require employees to work unpaid overtime. This is illegal according to the Fair Labor Standards Act. The law requires paying workers one and a half times their regular hourly wage when they put in more than forty hours of work during a week.

If you’re below this requirement, then not only are you breaking the law but your competitor who pays his staff correctly will most likely have an edge on your business because he’ll be able to offer better rates and still make profits! Such laws exist to protect both employee rights and employers from competition based solely on unfair labor practices.

No pay stubs or W2’s issued by the employer

Federal law states all employees should receive a pay stub at the end of every payroll period; without it, many employers have no evidence of payment to withhold taxes from an employee’s income for an economic misdemeanor. Moreover, if these documents are not provided in full within three days following a request by an authorized representative of a state agency, the employer may be guilty of a criminal misdemeanor.

Not paying final wages

The requirement for final paychecks is also a federal law, and it states that employers must provide employees with their paycheck within the next thirty days of termination. This applies even if you are not obligated by any state or local laws on this subject (but be advised that there may still be restrictions in your own jurisdiction).

Employers who fail to comply with these requirements will face penalties from between $500-$1500 per employee.

It’s important that you don’t withhold any part of an employee’s paycheck without cause – this is considered wage theft. The law requires that an employer pay an employee’s final wages within a reasonable time after termination.

Inaccurate pay, including minimum wage violations

Some employers deliberately underpay their employees by not paying them for all hours worked or fail to document overtime in order to avoid paying time and a half. This is also illegal according to federal law.

If an employee has been wrongfully deprived of any one of these four items – they could file complaints with state and/or federal agencies such as the U.S Department Of Labor’s Wage And Hour Division (WHD).

What can happen if WHD investigates?

If it determines that there was indeed wrongdoing on behalf of your company, you’ll owe back wages; fines will apply too! In fact, some states have laws stating when back wages are owed without any investigation.

How to Respond to Employee Wage Complaints

The first step in any wage complaint is to investigate the claim and determine whether or not it’s true. If you find that there was a genuine error, then follow up with your payroll provider; they might be able to help correct the problem for you or at least have some tips on how to prevent it from happening again!

If, however, you don’t believe their allegations are valid – maybe because of discrepancies between hours worked and pay received – then offer them what documentation you can (pay stubs, time cards) so that they can present their case before filing suit against your company. You may also want to consult legal counsel during this process.

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