WATCH OUT FOR THE NEW PAYCHECK RULES

Up until now, if an employee’s paycheck was less than the total amount owed, it was the employer’s option whether to write a special paycheck to make up the difference or require the employee to wait until the next scheduled payroll.  Some employers might write a special paycheck if the error was the employer’s fault (e.g., data entry error), but would refuse to do so if the employee was responsible for the error (e.g., employee failed to turn in his time sheet on time, or the time sheet was illegible).   Beginning on January 1, 2008, employers will be required to pay the shortfall under certain circumstances.

Specifically, beginning on that date, if an employer discovers that an employee was not paid the full amount owed, there is no dispute about the amount still due, and the amount due is at least 5% of that employee’s gross wages usually paid during that pay period, the employer must pay the full amount still due within three days (excluding Saturdays, Sundays and holidays) of discovery.  If the amount owed is less than 5% of the employee’s gross wages due on that payday, then the employer must pay the full amount no later than the next regular payday.