The state of California has numerous laws and regulations that govern how and when paychecks are to be issued. Workers should be aware of five key rights:
- what their pay stub has to include,
- when they are entitled to their wages,
- their rights to examine their payroll records,
- what has to be included in their final paycheck, and
- when employers can make deductions from a worker’s wages.
1. Information that must be included in your pay stub
Under California Labor Code section 226(a), all pay stubs must include the following information:
- the employee’s name,
- the employee’s identification number or the last 4 digits of their Social Security Number,
- the employer’s name and address,
- the dates of the pay period in question, which are read to be inclusive,
- the number of total hours worked,
- how many of those hours worked were entitled to overtime pay,
- the hourly rate of pay and the number of hours worked at each rate,
- gross wages earned,
- any deductions from the gross wages, and
- the employee’s net wages earned.1
Information regarding the number of hours you worked does not have to be provided if you are an exempt employee.
If you get paid on a piece-rate basis, the pay stub has to show the:
- piece rate, and
- the number of units earned.2
This information must be included on all pay stubs, even if you are paid in cash.3
If your employer does not provide a pay stub or if some of the information is missing or inaccurate, you may be able to file a wage and hour lawsuit. You may be entitled to:
- $50 for the initial pay period affected by the errors and $100 for each subsequent pay period, up to $4,000,
- court costs, and
- attorney’s fees.4
However, recent changes to the law give California employers an opportunity to correct the errors.5
2. How frequently wages must be paid
California labor laws require employers to pay their non-exempt workers no less frequently than twice a month. Your employer must tell you the specific day during the workweek when you will be paid.6 These paydays must comply with the following 2 rules:
- money earned between the 1st and the 15th day of the month must be paid by the 26th day of the month, and
- money earned during the last half of the month must be paid before the 10th day of the following month.7
Exempt workers, however, can be paid once per month. However, these professional employees’ wages must be paid on or before the 26th day of the month.8
All regular wages must be paid within 7 calendar days after the close of the pay period.9 Any overtime payments must be made by the next regular payday.10
Payment of wages can be made using:
- check, so long as there is no discount or a fee, or
- with your consent, using a direct deposit into a financial institution of your choice.11
If you are terminated from your job, you must be paid immediately at the time of termination. If an employee quits or voluntarily resigns, it will depend on how many hours notice they gave their employer:
- if they gave more than 72 hours of prior notice, they are entitled to their final paycheck on their last day of work, while
- if they gave less than 72 hours of notice, their employer must pay their final wages within 72 hours of their resignation.12
California employees who have unpaid wages after ending their employment relationship can file a wage claim to recover them. They can also notify the labor commissioner at the Division of Labor Standards Enforcement (DLSE) of the violation. Establishing an attorney-client relationship with an employment attorney from a reputable law firm is essential before taking either of these steps.
3. You have a right to examine your payroll records
California Labor Code 226 also gives an employee the right to review his or her payroll records and wage statements.
Employers are legally obligated to preserve these documents for at least 3 years under state law.
Current or former employees can file a request with their employer to review their payroll records. This request can be oral or in writing. After receiving this request, the employer has 21 days to allow for the inspection. You can also request a copy of these records. If you ask for a copy, your employer can charge you reasonable copying costs.13
If your employer fails to provide the requested records, it is an infraction that carries a $750 penalty.14
4. What has to be included in your final paycheck
In California, your final paycheck must include all of the wages that you have earned. Because California law considers paid and accrued vacation time as a form of wage,15 you are also entitled to a cash out for any unused vacation days in your final paycheck.
However, not all paid time off (PTO) is a form of wage in California. You are not legally entitled to cash out unused sick days in the state. If your employment contract or collective bargaining agreement says otherwise, though, then you can collect compensation for unused sick time.
If this paycheck is not provided quickly enough, your employer can face a waiting time penalty.
5. When employers can make deductions from your wages
Under California employment law, your employer can only deduct or withhold wages from your paycheck if doing so is:
- required by a state or federal law, or the law empowers your employer to do so, or
- pursuant to your written authorization, or an authorization by your collective bargaining agreement, to cover health insurance premiums or contributions to other employee benefit plans.16
This means that the following deductions are unlawful:
- all or any portion of your tips or gratuities,17
- the costs of a work uniform, unless you consent, in writing, to a deduction from your final paycheck if the uniform is not returned,18
- losses to your commission pay from unidentified returns after you leave work,19 and
- costs from a medical or physical examination that was taken as a condition of employment.20
- California Labor Code 226(a) LAB.
- California Labor Code 226(e)(1) LAB.
- California Labor Code 2699 LAB.
- California Labor Code 204 LAB.
- California Labor Code 204(d) LAB.
- California Labor Code 204(b) LAB.
- California Labor Code sections 212 and 213 LAB.
- California Labor Code 201 LAB.
- California Labor Code 226(c) LAB.
- California Labor Code 226(f) LAB.
- California Labor Code 200 LAB.
- California Labor Code 224 LAB.
- California Labor Code 351 LAB.
- California Labor Code 2802 LAB.
- Hudgins v. Nieman Marcus, 34 Cal.App.4th 1109 (1995).
- California Labor Code 222.5 LAB.