What are the California Final Pay Rules for the Timing of Final Paychecks?
Basic Guide to What Is Required for Compliance with the California Final Pay Rules
The time requirement for a final paycheck depends on whether the employee:
- quit without notice;
- quit with at least 72 hours notice; or
- was terminated or laid off.
Employee Was Terminated or Laid Off
If an employer terminates an employee in California or lays him or her off with no specific return date within the normal pay period, all wages and accrued vacation earned but unpaid are due and payable immediately.
It is not acceptable to ask or require an employee to wait until the next regular pay day for his or her final wages. An employer in California may not withhold a final paycheck. It is illegal to withhold the final paycheck to induce the former employee to:
- Return tools, uniforms, pagers, laptop computers, keys or any other items belonging to the employer;
- Pay back money that maybe owed to the employer; or
- Turn in expense reimbursement forms.
The California Labor Code requires that employees receive all earned and unpaid wages at the time of discharge from employment. If not, the employer may be assessed waiting time penalties. The California Supreme Court has ruled that neither length of employment or the reason for termination changes this requirement. Employees service to an employer is completed either by completion of the hired for task or at termination by the employer. Both constitute a discharge as defined by law. The discharge does not require an in voluntary termination from an ongoing employment relationship. An employee hired to perform one day of service must be paid at the end of that day.
Voluntary Quit: More than 72 Hours Notice
In the event of a voluntary quit, i.e. the employee voluntarily resigns from his or her position, the time for final payment of wages depends on the amount of notice that the resigning employee provides his or her employer. All wages and accrued vacation earned but unpaid for an employee who quits with more than 72 hours notice to his or her employer are due and payable on the last day of work.
Voluntary Quit: Less than 72 Hours Notice
All wages and accrued vacation on the unpaid for an employee quits with less than 72 hours notice to his or her employer are due and payable not later than 72 hours after notice is given. An employee who gives less than 72 hours notice is entitled to receive his or her final wage payment by mail if he or she so requests and designates a mailing address.