It is a common occurrence in the retail or restaurant industry: an employee’s cash drawer is short at the end of a shift or a server has a customer walk out on a check without paying at all. Employees often want to know whether their employer can force them to pay the cash shortage from their register drawer or compensate the employer for the customer that walked out by withdrawing funds from their personal paycheck.
Luckily, the answer to that question is almost always a firm no. However, there are some occasions where withdrawals or deductions can lawfully be made from employee paychecks. Nevada law has strict requirements concerning what amounts an employer is permitted to withdraw or deduct from an employee’s wages.
Mandatory Deductions
Some deductions from an employee’s paycheck are mandatory. This includes things like taxes, child support payments, or other wage garnishments. Employer must make these deductions or face penalties of their own.
Voluntary Deductions
For deductions that are not required by law, an employer can only deduct amounts from an employee’s wages if the employee has given the employer express written prior authorization to deduct a specific amount. Employees often provide authorizations for employers to deduct wages from their check for 401(k) contributions or union dues. These are authorized deductions from paychecks and employee wages.
Under Nevada law, the written authorization for deduction must include (1) the specific amount being deducted from wages, (2) the purpose of the deduction, and (3) the specific pay period in which the deduction is to be made by the employer from the employee’s wages. The written authorization must also be voluntary, which means an employer cannot require an employee to sign an authorization for deduction against the employee’s will. This is pursuant to Nevada Administrative Code Section 608.160.
In the past, some employers have attempted to use blanket authorizations from employees that allow for deduction from an employee’s wages whenever a cash register is short or a customer walks out. Those authorizations would not state a specific amount or time period for deduction. This type of authorization is not permitted under Nevada law because it is not specific enough to be enforceable. An employer that makes deductions based on such a blanket authorization violates Nevada labor law.
What happens if an employer deducts amounts from employees’ wages without authorization?
An employee who has an employer deduct amounts from their paycheck without a proper authorization is permitted to file a complaint with the Nevada Labor Commissioner. The employee is entitled to return of the amounts unlawfully taken by the employer. In addition, the Labor Commissioner can enforce and administrative penalty of up to $5,000 against the employer for each violation of Nevada Law. This post is merely legal information and is not legal advice, the only way to obtain legal advice concerning your specific facts is by retaining a Nevada licensed attorney.
Disclaimer
Nathan Ring is an attorney licensed to practice in Nevada, Washington, and Oregon. The contents of this article are purely legal information and are not legal advice. The article does not form an attorney-client relationship between Mr. Ring or his firm and any person reading this article.
