Your employer was not legally entitled to take the money she thinks you stole out of your pay. She owes you that money, plus a waiting time penalty of one day's pay for each day she withholds that money up to a maximum of 30 days.
You can enforce your rights to those monies in several ways.
You can file a small claims action.
You can hire an attorney to write a demand letter, which might shake the money loose.
You can bring an administrative action in the Labor Commissioner's Office, also known as the California Division of Labor Standards Enforcement.
Or you can hire an attorney and bring a superior court complaint.
There will not be a great deal in controversy. There are strengths and weaknesses to these approaches. You would be well served to locate and consult with an experienced employment law attorney as soon as possible to explore your facts and determine your options. I would suggest you look either on this site in the Find a Lawyer section, or go to www.cela.org, the home page for the California Employment Lawyers Association, an organization whose members are dedicated to the representation of employees against their employers.
Good luck to you.
This answer should not be construed to create any attorney-client relationship. Such a relationship can be formed only through the mutual execution of an attorney-client agreement. The answer given is based on the extremely limited facts provided and the proper course of action might change significantly with the introduction of other facts. All who read this answer should not rely on the answer to govern their conduct. Please seek the advice of competent counsel after disclosing all facts to that attorney. This answer is intended for California residents only. The answering party is only licensed to practice in the State of California.
No, the withholding of wages from your paycheck is unlawful unless you signed a document in writing stating that the money may be withheld. You are owed your unpaid wages plus one day's pay for each day you have to wait for your unpaid wages - up to 30 days PLUS your attorneys' fees. However, your former employer may sue you to collect what she believes you stole.
I agree with my colleague's excellent answers. An employer should not may deductions from an employees wages, except as authorized by law or expressly authorized by an employee in a signed writing.
As a practical matter, an employer's better course of action is to pay the employee and then sue the employee to recover the money allegedly stolen in court. Otherwise, the employer risk substantial late payment penalties of up to 30 days pay under Labor Code 203.
According to the Division of Labor Standards Enforcement,
There is an exception to the foregoing contained in the Industrial Welfare Commission Wage Orders that purports to provide the employer the right to deduct from an employee’s wages for any cash shortage, breakage or loss of equipment if the employer can show that the shortage, breakage or loss is caused by a dishonest or willful act, or by the employee’s gross negligence. What this means is that a deduction may be legal if the employer proves that the loss resulted from the employee’s dishonesty, willfulness, or grossly negligent act. Under this regulation, a simple accusation does not give the employer the right to make the deduction. The DLSE has cautioned that use of this deduction contained in the IWC regulations may, in fact, not comply with the provisions of the California Labor Code and various California Court decisions. Furthermore, DLSE does not automatically assume that an employee was dishonest, acted willfully or was grossly negligent when an employer asserts such as a justification for making a deduction from an employee’s wages to cover a shortage, breakage, or loss to property or equipment.
Labor Code Section 224 clearly prohibits any deduction from an employee’s wages which is not either authorized by the employee in writing or permitted by law, and any employer who resorts to self-help does so at its own risk as an objective test is applied to determine whether the loss was due to dishonesty, willfulness, or a grossly negligent act. If your employer makes such a deduction and it is later determined that you were not guilty of a dishonest or willful act, or grossly negligent, you would be entitled to recover the amount of the wages withheld. Additionally, if you no longer work for the employer who made the deduction and it’s decided that the deduction was wrongful, you may also be able to recover the waiting time penalty pursuant to Labor Code Section 203.