What can I legally deduct from an employee’s paycheck?

Are you currently deducting the sale of your company’s products and services purchased by your employee from their paycheck?  Have you given your employee a payroll advance/loan and are currently deducting payments from their checks?  Are you sure this is legal?

As of November 6, 2015, Section 193 of the NYS Labor Law has been amended and clarified the meaning of deductions “for the benefit of the employee.” The deductions would benefit the employee by providing financial or other “support” for the employee, his or her family, or a charitable organization designated by the employee.  This “support” must fall into one of the following categories:

  •           Health and welfare benefits
  •           Pensions and retirement benefits
  •           Child care and educational benefits
  •           Charitable benefits
  •           Dues and assessments
  •           Transportation
  •           Food and lodging

As of November 6, 2015 the following deductions are no longer “authorized” from an employee’s wages:

  •          Repayment of loans, advances and overpayments that are not in accordance with the regulation
  •           Employee purchases of tools, equipment and attire required for work
  •           Recoupment of unauthorized expenses
  •           Repayment of employer losses
  •           Fines or penalties for tardiness, excessive leave, misconduct or quitting without notice
  •           Contributions to political action committees, campaigns and similar payments
  •           Fees, interest or the employer’s administrative costs

The changes to Section 193 of the NYS Labor Law will also change the way an employer may recover overpayments of salary due to mathematical or clerical errors and repayment of wage advances.  These deductions are still possible, but need to be handled in a specific way.  Feel free to consult with our Human Resource Generalist at 315-258-8780.